In a follow-up risk analysis on recent developments with the Trump administration, Chris Hattingh from the Centre for Risk Analysis highlighted the latest key developments that pose a threat to South Africa’s bilateral trade relations, especially within the context of the African Growth and Opportunity Act (AGOA).

According to Hattingh, the Trump administration has signed numerous executive orders affecting trade agreements.

One notable order, signed on February 13th, called for a review of non-reciprocal trade relationships and proposed changes to how the U.S. administers tariffs. This includes examining unfair taxes and non-tariff barriers imposed by trading partners.

Hattingh explained that this review could spotlight South Africa’s trade policies, including subsidies and regulatory burdens.

With AGOA up for renewal in September 2025, the U.S. administration might enforce stricter conditions. “Exclusion from AGOA would mean South African exports no longer enjoy tariff-free access,” Hattingh noted, “potentially raising costs for U.S. consumers and affecting South African producers.”

 

Overlooked Implications of Foreign Relationships

Concerns have arisen due to South Africa’s actions, such as not condemning Russia’s invasion of Ukraine, taking Israel to the International Court of Justice, and conducting military drills with China, Russia, and Iran. These actions have raised questions about South Africa’s neutrality and alignment.

When asked why South Africa seems to have overlooked the security of its relationship with the U.S, Hattingh pointed to historical and ideological reasons.

“The ANC has long-standing ties with countries like Russia, Cuba, and various Middle Eastern nations. Emotion and sentiment from these historical relationships influence current foreign policy,” he explained. Moreover, domestic economic decline may drive the government to seek moral influence on the global stage.

 

Diplomatic Efforts and Strategies

Despite the looming challenges, Hattingh anticipates diplomatic efforts to secure AGOA membership.

“President Ramaphosa has indicated that various envoys and delegations will be sent to Washington and other capitals globally,” Hattingh said. He emphasised that South Africa could also use the G20 platform to engage diplomatically.

To navigate the evolving geopolitical landscape and ensure sustainable trade and economic growth, Hattingh noted that South Africa should clarify its foreign policy positions, especially concerning relationships with Russia and Iran.

“Engaging with the Trump administration on a win-win basis, showing plans for investment, and pursuing reforms are crucial,” he added. Improving infrastructure and making it easier to do business will attract investment.

“If President Trump decides to attend the G20 summit in November 2025, that would be a signal that behind-the-scenes diplomatic work has been largely successful.”

 

If AGOA is Not Renewed for South Africa

Hattingh outlined potential scenarios for South Africa-U.S. trade relations if AGOA is not renewed. He warned that businesses might need to find alternative export markets and factor in higher costs due to tariffs, which could lead to job layoffs and impact business profitability.

If AGOA is not renewed, the industries most impacted are agriculture and automotive. “Agriculture includes wine, citrus, and some areas of the poultry sectors as well.”

“We will need to see domestically what sort of pressures and requests farmers and others put on the U.S. administration. Do they want more protectionism? Do they favour certain markets over others in terms of imports to the U.S.?”

Hattingh added that this type of pressure could potentially lead to increased tariffs or the threat of them.

Furthermore, if Trump views the new BRICS alliance as a threat to U.S. trade and interests, he might threaten higher tariffs on products from countries like Brazil and South Africa. This uncertainty demands that companies stay updated on developments and adjust their supply chains and export targets accordingly.

“South Africa needs to develop other export markets to mitigate the potential loss of AGOA benefits,” Hattingh suggested. He also highlighted the U.S. entering a more transactional period in its foreign policy, and South Africa must engage accordingly.

 

Future of South Africa-U.S. Trade Relations

Looking ahead, Hattingh emphasised that South Africa urgently needs to prioritise domestic reforms, enhancing infrastructure, and making the country more business-friendly.

“Engaging with the U.S. on mutually beneficial terms will be crucial for maintaining a positive trade relationship,” he stated. With the changing geopolitical climate, South Africa must adapt to ensure stability and growth.

The importance of bilateral trade for market competitiveness, food security, and lower prices of commodities cannot be overstated.

As the geopolitical landscape evolves, South Africa’s pro-active engagement and strategic positioning in global trade discussions will be essential to safeguarding its economic interests and ensuring sustainable growth.

 

 

Crack open insights with Chris Hattingh on the ChickenBytes Podcast