Tariffs Have Effectively Undermined AGOA – Tau

“Our stance is that the tariffs have effectively rendered the Agoa [African Growth and Opportunity Act] benefits moot in specific sectors,” stated Minister of Trade, Industry, and Competition Parks Tau during a joint media briefing with Minister of International Relations and Cooperation Ronald Lamola last Friday.

“It also excludes [from Agoa] sectors like automotive, which is influenced by the overall 25% tariff hikes to the US,” added Tau.

Read: South Africa pursues discussions with the US as car manufacturers confront a 25% tariff challenge

This follows the announcement from US President Donald Trump about plans to implement a minimum 10% tariff on all US imports, with even steeper duties aimed at key trading allies.

Trump had set a 30% tariff on imports from South Africa; however, Tau clarified that this was later adjusted to a 31% tariff.

Agoa is a legislative act approved by the US Congress in May 2000, designed to grant certain African nations preferential access to US markets. South Africa has benefitted from this act for more than twenty years.

Tau elaborated that the current US trade approach does not favor agreements that seem unbalanced. Based on this understanding, the department sees Agoa as effectively nullified.

According to Tau, the US has confirmed that the Agoa Forum, an annual assembly aimed at enhancing economic partnerships and trade between the United States and Africa, is scheduled for July.

Read: SA delegation meets with US officials to mend ties

“As African trade ministers participating in Agoa, we must engage under the premise of a US that has modified its trade policies, and we need to adapt our engagement accordingly. I anticipate that when we visit the US as trade ministers, our discussions will be grounded in a US approach that does not support arrangements favoring only one side,” remarked Tau.

Engagement with the US

Tau addressed the ongoing discussion about potentially applying reciprocal tariffs on goods imported from the US.

“That could lead to a downward spiral. It would be unwise to hastily decide to impose a reciprocal tax. Our strategy has always been to engage with the US directly and deploy a delegation. We will not resort to making public statements without prior discussions,” declared the minister.

Read: Facts don’t support Trump’s rationale for a 30% tariff on SA

A delegation is preparing to head to the US, but President Cyril Ramaphosa will specify the date, Tau commented.

The conversation will focus on tariffs and bilateral trade agreements between the US and South Africa.

“There are specific trade matters between the US and South Africa, even beyond Agoa. In fact, most of our trade with the US occurs outside of Agoa—25% falls under Agoa while 75% is governed by most-favored-nation agreements through the World Trade Organization,” noted Tau.

Read: US lawmakers revive call for review of South African relations

The World Trade Organization describes the most-favored-nation (MFN) principle as a foundational element of a multilateral trading system established after World War II. It aims to replace the conflicts and power imbalances of bilateral policies with guarantees of a rules-based framework where trading rights do not depend on the economic or political influence of individual participants.

“We also need to engage with the US regarding bilateral trade concerning our respective investments. South Africa has significantly invested in the US, with notable investments through companies like Sasol, Sappi, and others. We have firms that are listed on the US stock exchange,” stated Tau.

Read: Parks Tau seeks discussions with the US on tariffs

In his fact sheet, Trump defended his tariff on South Africa by claiming that the country imposes animal health restrictions on US pork products that lack scientific justification, allowing only a very limited list of US pork exports into South Africa.

“South Africa also imposes significant restrictions on US poultry exports through high tariffs, anti-dumping duties, and unjustified animal health restrictions. These barriers have caused a 78% reduction in US poultry exports to South Africa, declining from $89 million in 2019 to $19 million in 2024,” Trump stated.

In defense of South Africa’s position, Tau explains that there is a scientific rationale for the tariffs on pork, which the US disputes. “The US considers it an unjust burden, but our Department of Agriculture has illustrated why these concerns are vital for the health of our pork industry. We need to meet and reconvene on these matters.”

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