South Africa is unable to stop President Donald Trump from increasing tariffs on goods to 30%.
This move poses a significant challenge for South Africa, which relies heavily on trade with the US as its second-largest partner. The nation is now hastily working to support local industries likely to be impacted.
The economic difficulties for South Africa might just be starting, especially with the looming threat of being removed from the Africa Growth and Opportunity Act (AGOA) trade group or even facing a total cancellation of AGOA by September.
Trump enacted an executive order on Thursday raising tariffs due to the failure to secure separate agreements between South Africa and the US. Other nations have also faced punitive tariffs for various reasons.
In relation to neighboring Zimbabwe, South Africa is expected to bear a 30% charge. To remove tariffs on American goods, it must grapple with a standard 15% tariff set by the White House for other countries.
There’s a risk for South Africa to incur an additional 10% fee, linked to what Trump termed the BRICS group’s “anti-American” stance. This includes South Africa’s position on Iran, Hamas, and Israel.
As the August 1 tariff deadline approaches, South African officials have made various justifications, with Foreign Affairs Director Zane Dangor asserting that the government was making “all the right arguments.”
The main issue, however, was that these arguments didn’t align with what the US wanted to hear. South Africa, in particular, was resistant to altering non-tariff trade barriers, notably the Black Economic Empowerment (BEE) policy.
During South African President Cyril Ramaphosa’s visit to the White House in May, he did not present any substantial compromises but rather initiated discussions on topics like “white genocide.”
Additionally, South Africa did not replace Ebrahim Lasor, an ambassador expelled from the US, who was critical of Trump. McEbisi Jonas has since taken on a “special envoy” role, although his visa was reportedly denied.
