South Africa faces different trading environments with the United States over the next two years and potentially beyond 2028, as President Donald Trump’s tariff policies reshape trade conditions and questions remain over the future of the African Growth and Opportunity Act (AGOA).
The issues were discussed during a trade webinar hosted by the FairPlay movement and founder Francois Baird, which focused on the future of AGOA and its benefits for African countries, as well as US tariff policy and how trade relations could change under a new US administration after 2028.
Tariffs weaken AGOA benefits
US trade experts said South Africa’s benefits under AGOA had largely been negated by successive rounds of new US tariffs.
They said countries exporting to the US were diversifying into other markets because of the unpredictability of US trade policy, with South Africa’s citrus industry cited as an exception because it has long pursued an export diversification policy.
South Africa was advised to make greater use of its embassy in Washington to showcase its export products, engage lobbyists to promote South African interests to the US administration and consider policy changes that could make them more acceptable to US politicians.
The speakers also advised South Africa to engage directly with US states seeking to promote more trade with the country.
Prof Diana Furchtgott-Roth, an adjunct professor at George Washington University in Washington DC and the University of the Free State in Bloemfontein, said South Africa’s ties to countries viewed as inimical to the US were a hindrance to trade ties.
Trump tariffs face legal challenge
Trade expert Andrew Hale said all the tariffs imposed by President Trump were illegal. He predicted that the US government would have to repay them, as was already happening with the 30% “Liberation Day” tariffs imposed in April.
Hale, a fellow for international relations, trade and economics at think tank Advancing American Freedom, said the Trump administration did not favour “one size fits all” trade preference programmes such as AGOA.
He said the administration was seeking to “bully” countries into individual trade agreements.
Hale said none of these agreements was binding because they had not been endorsed by the US Congress and that they would eventually be ended by one side or the other.
Trade outlook after 2028 remains uncertain
The webinar also considered what US trade policy could look like after 2028 under a new administration.
Furchtgott-Roth said US trade policies might be different depending on whether the new president was a Republican or Democratic party member. She said a Democratic president would be more amenable to a broader AGOA agreement than a Republican one.
The webinar also looked at how rapid changes in policy complicate planning for industries seeking to export to the US.
South African citrus industry representative Jana Janse van Rensburg said exports worked best when there were long-term agreements, some lasting up to 20 years, because these provided certainty to producers and importers.
She said the US was an important market, taking approximately 5% of South Africa’s total citrus exports.
Other important markets, including the European Union, were becoming more restrictive, setting phytosanitary requirements that could only be met with significant increased costs.
Poultry industry questions US quota
Izaak Breitenbach of the South African Poultry Association (SAPA) said the poultry industry was not an AGOA beneficiary.
He said the industry had instead been harmed by an annual quota of US chicken imports free of anti-dumping duties, imposed in 2015.
“This means they can dump,” he said.
Breitenbach said the quota should have been scrapped because it was conditional on benefits to other South African industries that new US tariffs had negated.
He said the quota had now been accepted and increased by the South African government in trade negotiations with the US, without discussion with the poultry industry or an offer of benefits to counter the negative impact of the US quota.
The poultry industry does not export to the US but is seeking to expand exports of cooked chicken products to the European Union and Middle East, Breitenbach said.
He said South African industries that are AGOA winners should find ways to compensate or support industries that sacrifice for their benefit.
