South Africa plays a dangerous game

South Africa’s deteriorating relationship with the United States can cost the economy billions and alienate one of its most important trading partners.

Tensions between South Africa and the United States escalated after Donald Trump was inaugurated as President on 20 January 2025.

Since then, Trump has suspended United States aid to South Africa over its race-based laws and the controversial Expropriation Act.

Another problem for the United States is South Africa’s close relationship with Iran, Russia, China, and Hamas.

These countries are widely viewed as enemies of the United States, which raises questions about South Africa’s claim of neutrality.

South Africa’s case against Israel at the International Court of Justice has further entrenched the view that it is acting against the interests of the United States.

Although the US aid suspension impacted South Africa, especially its cut in the President’s Emergency Plan for AIDS Relief (PEPFAR) funding, this is only a taste of what can happen.

Many experts warned that unless South Africa addresses the concerns of the Trump Administration, more significant action can be expected.

These actions include losing African Growth and Opportunity Act (AGOA) benefits, tariffs on South African imports, and even sanctions.

Despite these threats, President Cyril Ramaphosa doubled down on the rhetoric that caused tensions between South Africa and the United States.

During his 2025 State of the Nation Address (SoNA), he said, “We will not be bullied. We will stand together as a united nation.”

On Tuesday, 25 February 2025, Ramaphosa and others published an article in Foreign Policy Magazine which attacked the United States, Israel, and the Trump Administration.

His co-authors were Malaysia Prime Minister Anwar Ibrahim, Colombia President Gustavo Petro, and Hague Group Chair Varsha Gandikota-Nellutla.

The article focused heavily on Israel’s war in Gaza, calling it an assault against the Palestinian people, echoing dark chapters in their own countries’ histories.

Ramaphosa wrote that United States President Donald Trump’s proposal to ‘take over’ Gaza strikes at the very foundations of international law.

This article further increased tensions between South Africa and the United States and risks the trade relationship between countries.

Trade and AGOA at risk

It is essential to consider the trade relationship between the two countries to understand the dangerous game South Africa and President Ramaphosa are playing.

According to the South African Revenue Service (SARS), the country exports goods worth R157 billion to the United States and imports products worth R120 billion.

This translates into a trade surplus of R36 billion with the United States, which is extremely valuable to South Africa.

Figures from the United States International Trade Commission differ from SARS’s data but also show the great value South Africa gets from the United States.

According to the AGOA information support portal, in 2023, South Africa exported $14 billion of goods to the USA. $3.6 billion of these exports were done under AGOA preference.

Since 2000, South Africa has enjoyed $60.3 billion of trade exports to the USA, directly due to the AGOA program.

The exports under AGOA account for roughly 1% of South Africa’s total gross domestic product (GDP) of R7 trillion.

According to the AGOA information portal, South Africa had a R125 billion total trade surplus with the United States.

The total trade surplus with the United States accounts for roughly 2% of South Africa’s total GDP. Conversely, the USA has a trade deficit with South Africa.

In essence, South Africa gains great value from its trade with the United States, while the USA loses value from its trade with South Africa.

Furthermore, the American economy is 73 times larger than the South African economy. Its trade with South Africa is negligible in economic terms.

Simply put, the United States is far more important to South Africa than the other way around. However, Ramaphosa tried to downplay this reality.

During the question-and-answer session in the National Assembly, Ramaphosa said the United States gained as much value from the AGOA agreement as South Africa.

He added that he conveyed this message to Trump after he was elected as the 47th president of the United States.

“We value participating in AGOA, but I also told President Trump that we sell critical minerals to the United States, and the relationship is fairly balanced,” Ramaphosa said.

The numbers do not support Ramaphosa’s claims. The reality is that a trade war will cause tremendous damage to South Africa and not affect the United States much.