Ramaphosa responds to new 30% tariff on South Africa

President Cyril Ramaphosa expressed concern over the United States’s decision to impose a new 30% import tariff on South African goods.

The office of the presidency said that the move was worrying, adding that it gives impetus to South Africa’s plans to negotiate new trade terms with the world’s biggest economy.

“Whilst South Africa remains committed to a mutually beneficial trade relationship with the United States, unilaterally imposed and punitive tariffs are a concern and serve as a barrier to trade and shared prosperity,” the Presidency said.

Trump announced a baseline 10% tariff on all US imports on Wednesday, with 60 countries—including South Africa—subject to higher rates.

Deemed the ‘worst offenders’, these countries had significantly higher trade imbalances with the United States, he said, warranting higher tariffs.

He said South Africa has been charging 60% tariffs on US goods, so the US would impose a 30% tariff on South Africa.

The Trump administration had previously talked up fully reciprocal tariffs, but the president said that the US would be “kind” and cut the tariffs in half.

The tariffs rattled markets, and South African businesses were deeply concerned about the implications.

Analysts have pointed to the tariffs, alongside worries that the Democratic Alliance will exit the Government of National Unity, as being significant impediments to dealmaking activity.

Trump has taken particular aim at South Africa since starting his second term in late January.

The US leader has signed executive orders cutting funding and opening a pathway for white Afrikaners to settle in the states as refugees. It has also pulled out of global renewable financing which has also hit South Africa.

Trump has said that South Africa’s policies are anti-American and accused the country of violating human rights by discriminating by seizing land and discriminating against certain groups.

This is in reference to the recently signed Expropriation Act, which introduces ‘nil compensation’ for expropriated land in specific situations, as well as South Africa’s long-standing employment equity and black economic empowerment laws.

His administration has also flagged South Africa’s ties to America’s enemies—Russia, China and Iran—as well as its opposition to Israel, one of the USA’s biggest allies.

South Africa also now stands to lose beneficial access to US markets through the African Growth and Opportunity Act (AGOA).

(With Bloomberg)