The global trade and tariff environment has become tense since Donald Trump took office at the White House in February 2025. From the looks of things, Trump has resumed his tariff war against the international community that he initiated during his first term in office. Countries are now confronted with the need to re-evaluate their customs and trade policies, with the intent of adapting to the current trade environment.
Siviwe Rikhotso is a Programme Manager at the Rosa Luxemburg Foundation’s Southern Africa Regional Office.
The US has embarked on this tariff regime to readdress the non-reciprocal tariff structures that the US has had with the international community, and to put “America first” again. As was expected, numerous countries (China, EU, and Canada) responded with their own tariffs against US products, with the highest of these retaliatory tariffs reaching 125 percent in April 2025. In some countries hit by tariffs (Japan, South Korea, and China), trade ministers met amongst themselves to discuss adaption policies, while other countries decided to or are planning to launch missions aimed at bilateral negotiations with the US. Likewise, a good number of African countries were hit with “reciprocal” tariffs by the US, which unsurprisingly caused a stir within the continent as tariffs to numerous countries reached over 30 percent and up to 50 percent.
South Africa, as the US’s largest trade partner in Africa, was hit with a 30-percent tariff on all exports to the US signifying the strained relations between the two nations. Similarly, at the time of writing, there appears to be little to no hope of the US renewing the African Growth Opportunity Act (AGOA), which affords African countries duty-free exports to the US. This is extremely the case for South Africa, whose relations with the US soured after Trump’s executive order to cut all aid funding to South Africa – an action followed by Trump’s accusations that the South African government was perpetrating violent attacks against White Afrikaner farming communities.
The Storm Makes Landfall
Earlier in the year, the US announced the imposition of a 30 percent tariff on selected exports from SA, which would take effect from 9 April 2025. For the US, these tariffs, along with other broader tariffs imposed on economies across the world, were reciprocal and intended to boost local manufacturing within the US under the “Fair and Reciprocal Plan” trade policy. Furthermore, Trump falsely claimed that South African tariffs on US exports to the African nation were at 60 percent, thus the implementation of a “discounted” 30 percent tariff made sense. In reality, South Africa averages a tariff of 7.6 percent against US exports to the country.
For Pretoria, a 30 percent tariff from its second-largest trading partner (after China), whose exports make up between 7 percent and 9 percent of South Africa’s total exports in value terms and contributes to nearly 2.7 percent of its total GDP, represents a storm set to cause significant damage to trade, manufacturing, and labour industries. Moreover, exports are an ever-important economic activity and contributor to the South African economy, making up a little over one third (more than 30 percent) of the country’s GDP. The hardest hit sector exporting to the US is the local automotive manufacturing sector, which represents at least 64 percent of total exports to the US, and just over 110,000 skilled labourers In 2024 alone, automotive (cars and car parts) exports to the US totalled 40 billion rand (nearly 2 billion euro), with half the totals (in value terms) coming to South Africa. It is for this reason that representatives of the automotive industry, the NAAMSA Automotive Business Council, maintained that South Africa possesses the abilities for retaliatory actions.
The collapse of Pretoria-Washington relations, which precedes Trump’s second term, has played out at various levels of engagement.
The tariffs will affect International car manufacturers such Mercedes Benz, BMW, Ford, Toyota, Isuzu, Nissan, and Volkswagen, all of which have invested in local car manufacturing facilities. Following the automotive industry, the agricultural industry is also significantly affected by the new tariff regime, although it must be mentioned that the agricultural industry is set to suffer heavily should the AGOA come to an end later this year – a very likely reality.
Unsurprisingly however, the strategic and critical minerals excluded (due to the 90 day tariff reprieve) from the tariffs include the platinum group metals manganese, gold, chrome, copper, and aluminium, pharmaceuticals, semiconductors, lumber articles, and certain energy products, some of which made up 76.3 percent of total exports to the US, amounting to 65.3-billion rand (3.2 billion euro) in 2024. Other minerals such as iron ore and diamonds are included in the tariffs.
Interestingly, these tariffs were not surprising, as reports claim that the Department of Trade, Industry and Competition (DTIC), against the backdrop of unfounded accusations from Trump about South Africa’s land expropriation bill and the looming end of the AGOA, also anticipated these tariffs and thus launched a bilateral mission to salvage relations, without success.
These tariffs will negatively affect South Africa’s economic growth. They will likely scale back production, contributing to already stubborn unemployment rates at over 30 percent and with nearly 300 000 job losses in the first quarter of this year alone, maladaptive trade and foreign policies, consumers’ buying power due to limited product options (as availability may shrink), and general mass disruption across the supply and value chains locally and internationally. Stakeholders can develop strategies to mitigate these impacts and ensure economic resilience by recognizing the potential US tariff effects on South Africa.
Experts also believe that because the US has also imposed tariffs on South Africa’s trade competitors (mainly commodity-exporting countries), South Africa may not completely lose a relative advantage in particular commodities. Much depends on the outcomes of trade and tariffs negotiations, but South Africa’s relative advantage is still there because of the broad-based nature of 10 percent tariffs against its trade competitors.
Collapsing Relations
beyond bilateralism, multiple sectors (trade, health, defence, diplomacy), and on issues that do not directly involve the two nations. Prior to Trump’s first term in office, relations between South and the US could easily be characterized as cordial, although there was an observable distrust of Washington by the ANC-led government in Pretoria, owing to the former’s alignment with the apartheid regime. During Trump’s first term, however, a visible breakdown in diplomatic relations began when US ambassadorship position was vacant for almost three years after Patrick Gaspard vacated the position.
The US and South Africa would lock horns again in 2022 when Russia invaded Ukraine. South Africa’s “neutral” stance became questionable when many of its positions in multilateral fora such as the UN refused to label Russia as the aggressor in the war, coming to a head when former US ambassador Ruben Brigety accused Pretoria of supplying weapons to aid Russia’s war in Ukraine. During its chairship of BRICS, South Africa found itself staging a balancing act, after the International Criminal Court (ICC), to which South Africa is a signatory, issued a US favoured warrant of arrest for Vladimir Putin for war crimes and crimes against humanity, after Putin was set to attend the BRICS Summit in Johannesburg.
Much of the actions in South Africa’s response to the tariffs really speak to long-term solutions that disregard fair trade and robust industrialization, and rather focus on the trading of raw materials.
As if this was not enough to further sour relations between the two countries, the breakout of conflict in Gaza between Israel and the Hamas-controlled government would further pit South Africa against the US. In 2024, South opened a genocide case against Israel at the International Criminal of Justice (ICJ), accusing Israel of perpetrating genocide against the Palestinian in the Gaza Strip. As Israel’s ally, the US predictively slammed the case as meritless. Fast-forward to 2025, and former South African ambassador to the US Ibrahim Rasool was declared persona non grata and expelled from the US by Secretary of State Marco Rubio, after the former accused Trump’s administration of white supremacism.
All of these developments are taking place in the midst of a very public snub of the G20 foreign minister’s meeting by Marco Rubio, and Trump’s executive order to cutting health funding to South Africa overnight, with immediate impacts on the health and livelihood of millions of South Africans. In the latest demonstration the collapse in South Africa-US relations, the US suspended military assistance and cooperation with SA, despite the latter doubling on the impacts of this suspension.
South Africa Responds
In a media statement from DTCI and DIRCO (the Department of International Relations and Cooperation), South Africa detailed its response to the 30 percent tariffs in what one can only perceive as a very much expected tone and language. In the statement, the government listed numerous actions to counter the impact of the long-term impacts of the tariffs, given it will likely be difficult (if not impossible) to counter the short-term effects. These actions include launching missions and delegations to the US to attempt negotiating for additional exemptions and quota agreements, intensifying efforts to diversify trade to include trade destinations in the Middle East, Asia, Europe, and the Americas.
Here, membership to host organizations, agreement, pacts (including the Southern Africa Customs Union, SADC, SADC-EU Economic Partnership Agreement, SACU+Mozambique-UK EPA, the European Free Trade Association, MERCOSUR and Japan Generalized System of Preferences) will prove instrumental to South Africa’s attempt at increase preferential market access to existing and new trade partners. Diversification of trade to include the Middle East and much of unexplored Asia received more attention given that it was also supported by the Minister of agriculture John Steenhuisen of the Democratic Alliance (DA), who is a known opponent of South Africa increasing trade with the east, specifically China.
The government also intends to utilize its G20 presidency as well as the AfCFTA agreement to bolster its trade relations both continentally and globally, and invest in value-added production (which will bolster the country’s industrialization strategy) to limit the risk of exposure to tariffs. Investing in local manufacturing will bolster infrastructure development, help offset retrenchment and unemployment pressures, and stimulate domestic economic growth.
Much of the actions in South Africa’s response to the tariffs really speak to long-term solutions that disregard fair trade and robust industrialization, and rather focus on the trading of raw materials. The need to address the immediate impact of the tariffs and offering short- and long-term solutions geared towards free and fair trade, regional integration beyond increased trade (to include regional industrialization, among others), is evident.
An investment strategist based at a leading investment firm in South Africa offered shortlisted a few pathways for SA to offset the immediate impacts of tariffs on employment, production levels, and maintaining the competitiveness of SA’s exports to global trade markets. These include decreasing prices to retain the competitiveness of exports and subsidizing impacted sectors. There are, however, downsides to this because any price drops mean that exporters lose profitability, which in turn also means scaling back production employment. Similarly, subsidies are very dependent on a country’s healthy fiscal position. The delayed adoption of South Africa’s fiscal framework (now referred to as “Budget 3.0”) and revenue proposal display how much of a challenge supporting the tariff-impacted sectors is for the country. In any case, all of the above actions and reactions point to a change in Pretoria’s trade policy towards the US, displaying attempts at trade adaptation.
In the policy analysis and academic spaces, scholars and analysts lamented the weak reactions to Trump’s tariff regime at the regional level. South Africa was not the only country hit with punitive tariffs, but also most neighbouring nations like Lesotho, Malawi, Mozambique, and Zambia, making a regional response necessary. This more than anything also signals the low state of Southern Africa’s regional integration, and the need to rethink and recalibrate the role and responsibilities of regional blocs like the SADC as first responders to regional crisis.
For instance, in a pre-emptive reaction to looming US tariffs, the trade ministers from three export powers in Asia (Japan, South Korea, and China) who are also part of Asia Pacific Economic Cooperation (APEC) and Regional Comprehensive Economic Partnership (RCEP) blocs, met to discuss enhancing regional free trade to adapt to and brace against US tariffs. The current discussion in trade debates also emphasize the need for regional integration with the intent of rethinking the trade strategy of the Southern Customs Union amid the current trade/tariff environment, and how such strategies need to include non-state actors like law firms to help understand and draft treaties.
Reactions to the Ramaphosa-Trump Meeting
In a recent media interview, the spokesperson of the presidency, Vincent Magwenya, alluded to the finalization of a new trade framework that South Africa’s President Cyril Ramaphosa would present and speak to on his meeting with US President Donald Trump on 21 May. This framework, whose initial discussions will only take place at high level before being discussed at the lower levels of state, is centred on bilateral trade relations between SA and the US, as well as the possible renewal of AGOA.
Prior to the meeting, public perceptions and reactions to this, especially after the presidency revealed who would be part of the negotiations (John Steenhuisen, Ronald Lamola, Parks Tau, and Khumbudzo Ntshavheni, Zingiswa Losi, Johan Rupert, retired golfers Ernie Els and Retief Goosen), were characterized by pessimism vis-à-vis improved relations between the two countries. A report suggested that discussions would also centre on plans for opportunities for Tesla and Starlink, as well as a “racial requirement” exemption for US companies in South Africa. From this, it is clear that the only way South Africa could change Trump’s mind on the pending tariffs and expulsion from AGOA is to make serious concessions that would benefit the US, and undoubtedly cause increased public backlash towards the government.
More than anything, a useful lesson from this entire situation is that like a business’s revenue stream, a nation’s trade basket needs to be diversified as possible to avoid the risk of dependency on one single trade partner when relations collapse.
While the televised segment of the SA-US discussions could be categorised as “cordial” (at least in comparison to other meetings with other world leaders), it was still apparent that Trump was not interested in facts and that Ramaphosa may not have decided on his own who to invite with him. This is especially true when discussion on the false claims of genocide against white Afrikaners in South Africa came up. The responses from Steenhuisen, Goosen, and Els were attempts to dissuade Trump of this false notion but rather piled on his convictions on the land issue in South Africa. It was only until Rupert (which was a surprise as well) that someone sought to dispel the false genocide and land claims by Trump.
Ramaphosa himself viewed the meeting as a success – judging from the plenary discussions and DICT minister, Parks Tau also highlighted how tariffs and AGOA were central to negotiations, and that a revised framework agreement was submitted after the first draft was sent back for feedback, citing some areas of non-alignment.
In South Africa, public reactions can be distinguished as either disappointed at the South African camp (given that they did not convincingly speak with one voice), or praising Ramaphosa’s poised and composed diplomatic reaction to Trump’s provocations and the welcomed surprise of Rupert’s honesty to speak about issues confronting South Africa. One can certainly hope that the success that Ramaphosa speaks of is substantive and will not be at the cost of significant concessions. A key take away from this meeting was that much is left to be desired from South Africa’s ability to skilfully navigate the trenches of Trump’s diplomacy, the agency to voice Pretoria’s positions clearly, and drive the perception of South Africa as a desirable and important trade partner on the continent.
More than anything, a useful lesson from this entire situation is that like a business’s revenue stream, a nation’s trade basket needs to be diversified as possible to avoid the risk of dependency on one single trade partner when relations collapse. While the US’s trade with South Africa contributes a manageable percentage to the country’s GDP, it is neither significant enough to collapse the country’s economy nor is it so insignificant that SA could afford to lose it overnight.
Lastly, the importance of diplomacy in an uncertain and volatile international stage where even trade deals, as it appears, are a consequence of diplomatic skill, geopolitical awareness, and the ability to play on your strengths and hide your weakness, cannot be overstated.