PETER BRUCE | Why Trump’s tariffs — and Agoa — matter far less to South Africa than we think

Two important home truths. First, US President Donald Trump’s 30% tariffs on South Africa have not done us much economic harm. I asked Donald MacKay, MD of XA Global Trade Advisors and the smartest trade brain in the country, why.

“About half of what we export is exempted because they’re precious metals,” he says. “Automotive is really Mercedes-Benz in East London, and that is not part of the 30% reciprocal tariffs but of the US Section 232 tariffs, which are tariffs on all imported cars of 25%.

“Then you get into agriculture and citrus, and by the time the duties came in, the local season was over, and now Trump has exempted a lot of the citrus from the 30%. There’s a table grapes exemption application in. And wine will take a bit of punishment … but when you’ve gone through all of those, there’s nothing much on the list.”

Second, we have been kidding ourselves about the importance of the US African Growth and Opportunities Act (Agoa).

“In terms of Agoa,” says MacKay, “the average value of the tax that was saved, as a percentage of total exports into the US under Agoa, is 3.5% on the products that get a benefit, and in a year that amounts to about R2bn. I don’t think people have a sense of how tiny a portion of our overall exports benefited from Agoa or how small the Agoa benefit was.”

All of which might explain why President Cyril Ramaphosa has not felt the need to offer Trump much in the way of big wins for the White House as his trade negotiator, Alistair Ruiters, completes six months of unproductive talks with the Americans. It turns out there’s no need to rush or to pander to Trump.

Some of the local groups lobbying the White House for action against Pretoria on expropriation without compensation, or the chant Kill the Boer, or BEE might be disheartened at this perspective, but it may need to be them, not the government, who goes back to the drawing board.

Some of the local groups lobbying the White House for action against Pretoria on expropriation without compensation, or the chant Kill the Boer, or BEE might be disheartened at this perspective, but it may need to be them, not the government, who goes back to the drawing board.

Ramaphosa, meanwhile, lives his two lives. In his magic world he emerged unscathed from an ANC policy conference this week, pledging to double down on BEE and the National Health Insurance programme amid plans by the party to grow local exports to R3-trillion, a huge stretch for this economy.

On the tougher side, in the wake of Trump barring South Africa from the 2026 Group of 20 summit in the US, he is all over the place about how, or if, to appoint Ruiters as ambassador to Washington, where the embassy has not had any serious leadership since 2022.

Earlier in December he was not going to make an appointment at all, preferring to use Ruiters to negotiate alternative trade deals with likely prospects in the Middle East and Asia.

Then he was going to appoint him to Washington, having decided he could have more “impact” there. But he has gone quiet again, fretting about timing and what to do if the Americans reject the appointment.

A micro-lobby argues that appointing an ambassador now would be the equivalent of “bending the knee” to Trump, but whatever the optics are, the fact is that Ruiters is a diligent, experienced and scrupulous public servant. Not appointing him for fear of what Trump might do is ridiculous.

And while the Americans are capable of really hurting South Africa with sanctions if they want to, the fact is that Trump is losing his mind. And his support in the Republican Party, where Congressmen and -women and senators now fear for their political future as the November 2026 midterm elections loom.

Politically in the US, he is just about done. Now, not later, is the time to have a strong ambassador in Washington to restore old relationships gathering dust under Ramaphosa’s feckless management of foreign policy and to build new ones for when Trump leaves office or simply becomes a lame duck after the midterms.

Someone with a clear head needs to be there when Ramaphosa faces a truly chilling moment, probably also in 2026. A grand jury is investigating whether there is a case for MTN to answer for its former Afghan subsidiary facilitating communications for the Taliban while US forces were operating in the country.

All the big US social media platforms, including the parents of Google and WhatsApp, have been instructed to supply complete histories of all MTN e-mails and messages they have since MTN first bought 49% of Irancell in 2005.

Ramaphosa was MTN chair between 2002 and 2013, and along with a host of other ANC luminaries, his communications seem likely to be made public in a giant digital dump.

Ramaphosa is going to need a firm hand to hold on to in Washington when it happens.