JOHANNESBURG – South Africa is facing a major economic jolt as the United States, under President Donald Trump, prepares to impose sweeping tariffs on South African exports, a move that could upend trade relations, hurt local industries, and threaten jobs.
The Department of Trade and Industry confirmed that South Africa has formally requested more time to renegotiate its trade terms with the U.S. — just days before the new tariff regime is set to take effect on 9 July 2025.
The announcement follows a dramatic letter from President Trump, seen as both a warning and an ultimatum, accusing South Africa of “persistent and unfair” trade practices and promising a blanket 30% tariff on all goods entering the U.S. from South Africa — unless “reciprocal trade terms” are agreed upon.
“Starting on August 1, 2025, we will charge South Africa a tariff of only 30% on any and all South African products sent into the United States… These tariffs are necessary to correct the many years of South Africa’s tariff and non-tariff policies and trade barriers,” Trump said in the letter.
Impact on SA Business
Local businesses, especially those in manufacturing, automotive, and metal sectors, are already feeling the pressure. Cornelius Coetzee, South Africa Country Director for leading cross-border payments provider Verto, described the current trade climate as “complex and challenging.”
“While there’s a temporary 10% tariff on many goods right now, the 90-day review period and the threat of a 30% blanket tariff mean local businesses must prepare for significant cost increases,” Coetzee told reporters. “The removal of AGOA benefits worsens the situation — our goods no longer enter the U.S. duty-free.”
South African exporters now face a painful dilemma: either absorb the increased costs and risk job losses, or pass them onto buyers and potentially lose market share in the world’s biggest economy.
The weakening Rand, often triggered by trade tensions and currency volatility, is also pushing up import costs for manufacturers, contributing to inflation and pricing pressure across various sectors.
Critical Minerals Exempt – For Now
Despite the looming tariffs, not all hope is lost. South Africa’s Platinum Group Metals (PGMs) and titanium exports, which represent nearly 76% of South Africa’s U.S. export basket, are largely exempt for now. This provides a narrow lifeline for the country’s mining and mineral sectors.
Coetzee added that the U.S.’s broader tariff war with other nations may offer a “trade advantage” for South African products in specific areas — if local firms can move quickly to seize those gaps.
Verto’s Survival Playbook for SA Traders
To help businesses adapt, Verto SA has issued a survival guide for importers and exporters facing this tariff storm. The top strategies include:
- Diversify Markets: South Africa is already engaging with Asia and the Middle East. Tapping into new regions with competitive pricing can reduce reliance on U.S. markets.
- Cut Costs and Streamline Operations: Businesses may need to absorb some tariff costs to remain globally competitive — meaning increased operational efficiency is essential.
- Partner with Government and Industry Bodies: Coetzee called for the formation of intergovernmental task teams and new trade missions to assist firms in exploring new markets.
- Know Your Value: If your product is essential, buyers may still purchase it — tariffs or not. Businesses must refocus on what makes them indispensable.
- Stay Agile: Trade policy is shifting rapidly. Businesses that can pivot quickly will survive and potentially thrive.
Additionally, Coetzee encouraged local businesses to explore new opportunities across East and West Africa, saying that Verto’s platform allows for fast, secure, and localised payment solutions that overcome traditional market-entry challenges.
“By leveraging our local collection accounts in currencies like the Naira, CFA, or Kenyan Shilling, companies can scale into regions that were previously out of reach. This is how we help businesses turn adversity into opportunity,” he said.
Government Scrambles to Respond
South Africa’s Trade and Industry Minister, Parks Tau, said negotiations with the U.S. are ongoing and that a revised trade agreement might be necessary, potentially shifting the deadline for the tariff implementation.
“We are engaging President Trump’s administration and pushing for more time. We’re also considering structural changes to the agreement to protect local industry,” Tau said.
However, with the 30% tariff scheduled to hit within weeks, time is quickly running out.
The Bigger Picture
Trump’s push for “more balanced and fair” trade agreements is part of a wider effort to reduce U.S. trade deficits — a campaign that has already seen Washington raise tariffs on other global partners.
For South Africa, which heavily relies on U.S. trade in sectors like automotive, agriculture, and processed goods, this development poses a major risk to economic growth, investment, and jobs.
“This is not just about tariffs. It’s about the future of our international trade positioning,” Coetzee warned. “Businesses need to act now — waiting could prove fatal.”
As the deadline looms, South African exporters, manufacturers, and importers now find themselves in a race against time, forced to rethink how and where they do business — or risk being priced out of global markets.
