The US is South Africa’s third-largest trading partner, accounting for 7.5% of total exports.
International Relations and Cooperation Minister Ronald Lamola has assured the public that support programmes will help offset the 30% tariff by the United States (US) on South African exports.
Lamola, along with Trade, Industry and Competition Minister Parks Tau, spoke at a media briefing on Monday about how government plans to respond.
The 30% tariff was first announced by US President Donald Trump in April.
Although there was a three-month delay to allow for trade talks, South Africa has not managed to secure a new deal with the US.
South Africa responds to US tariffs
On Monday, Lamola expressed disappointment at the US decision to go ahead with the tariff, which is a tax charged on goods bought from other countries.
The minister explained that discussions with the US over the past year focused on resolving key trade issues, but despite those efforts, the North American powerhouse went ahead with the 30% tariff.
“South Africa has been engaging the US at various levels with a view to ensure predictability in trade,” he said.
Lamola appeared to criticise some groups within South Africa who may have hurt the country’s relationship with the US.
“It is unfortunate that this government’s efforts in resetting the relationship with the US have been undermined by some actors within South African society.”
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Representatives from the Democratic Alliance (DA), AfriForum, the Solidarity Movement, and Freedom Front Plus (FF Plus) travelled to the US this year to voice concerns over South African policies such as broad-based black economic empowerment (B-BBEE) and the Expropriation Act.
This coincided with Trump’s executive order granting refugee status to Afrikaners, citing claims of persecution, while also cutting US financial aid to South Africa in response to the International Court of Justice (ICJ) case brought by President Cyril Ramaphosa’s administration against Israel.
As a result, the South Africa government has repeatedly accused the groups of sowing division in the country.
Some exports will remain exempt
The tariffs will take effect at midnight on Friday, 8 August.
However, goods that are already in transit before that time and arrive before 5 October will still be subject to the current 10% tariff instead of the higher 30%, according to Lamola.
Lamola highlighted that the US is South Africa’s third-largest trading partner, accounting for 7.5% of total exports.
He said the government remains committed to pursuing a fair and balanced trade deal.
“Thus, we will continue to engage the US with a view to conclude a deal that advances the interests of both countries… rather than extractive relations that deprive the country of the ability to beneficiate our mineral wealth by mimicking extractive colonial era trade relations.”
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The minister also stressed that South Africa posed no trade threat to the US economy or its national security.
“South African exports do not compete with US producers and do not pose a threat to US industry. On the contrary, our exports are crucial inputs that support America’s own industrial base.
“Our agriculture exports are even counter-seasonal, meaning they fill gaps in the US market, not replace domestic products.”
Watch the briefing below:
Economists estimate that the new tariffs could reduce South Africa’s economic growth by 0.2%.
However, Lamola pointed out that 35% of South African exports will remain exempt.
These include products like copper, pharmaceuticals, semiconductors, critical minerals, stainless steel scrap and energy-related products.
He also mentioned that South African companies have already adapted to steel and aluminium tariffs that were introduced under Section 232 of the US Trade Expansion Act back in 2018.
“However, the heightened policy uncertainty creates instability in trade and may have an impact on exports.”
US tariffs support measures
To respond to the impact of the tariffs, the government will roll out several key support measures.
This includes an export support desk that will act as a single point of contact for companies affected by the US tariff hike.
The desk will provide ongoing updates, assist with exploring new international markets, and connect exporters with South African embassies and high commissions abroad.
An economic relief package is also being prepared to help companies cope with short-term financial pressures and develop longer-term plans to protect jobs and production.
“The details of these are being finalised and will be communicated shortly,” Lamola continued.
In addition, an export and competitiveness support programme will be launched to provide working capital and funding for plant and equipment upgrades to address short to medium term needs across all industries.
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The government is also working closely with the Department of Labour to prevent job losses.
Existing tools, such as the Unemployment Insurance Fund (UIF), will be adjusted to better respond to the challenges created by the tariff hike.
Lamola announced that a legal exemption, known as a block exemption, will be introduced under the Competition Act.
This will allow companies to legally coordinate their efforts, such as sharing export infrastructure and market information, which would normally be restricted under competition laws.
“The block exemption details the scope of application. A draft block exemption will be published by the end of the week so that the process can be concluded expeditiously.”
In the long term, Lamola said South Africa is strengthening relationships with trade partners across multiple continents.
He added that, although the new tariff presents challenges, it also opens the door to expand trade through the African Continental Free Trade Area (AfCFTA) and to explore new markets such as the Association of Southeast Asian Nations (ASEAN) and Türkiye.
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