This week we woke up to a new world order for global trade. Import tariffs set by the administration of US President Donald Trump on almost every country in the world have kicked in, making products from abroad pricier for American consumers.
The US remains South Africa’s largest bilateral trading partner. In 2024 the two countries conducted goods and services trade worth $26.2bn (about R465bn). The US accounts for 7.5% of our global exports, most of which are vehicle and automotive components, citrus fruit and wine.
However, several sectors, making up 35% of exports to the US, remain exempt from the tariffs. These include copper, pharmaceuticals, semiconductors, lumber products, certain critical minerals, stainless steel scrap and energy products.
South Africa’s infrastructure-support supply chain ... is geared to US specifications. Shipping to the US is also less expensive than rerouting exports to the Far East or other parts of Asia
In April Trump imposed a 25% tariff on all vehicle imports. The impact was immediate: South African vehicle exports to the US dropped more than 80% — from 16,112 to 2,875 units — in the first half of the year compared with 2024.
The 30% reciprocal tariffs are predicted to put an estimated 30,000 jobs at risk.
The department of trade, industry & competition has outlined demand-side interventions targeting industries affected by the tariff increase. It has set up an export support desk to serve as a direct point of contact for affected companies. It has also established a localisation support fund for sectors looking to reduce their reliance on exports, as well as an export and competitiveness support programme that has working capital and plant equipment facilities to support companies keen to ramp up production here at home.
But the truth is that the US market will be difficult to replace. Its scale and purchasing power as a $21-trillion economy are unmatched. US consumers have a high demand for quality goods and products, and they are willing to pay premium prices. This market also offers predictability and stability.
South Africa’s infrastructure-support supply chain, such as cold storage for perishables and auto-manufacturing standards, is geared to US specifications. Shipping to the US is also less expensive than rerouting exports to the Far East or other parts of Asia.
While diversification efforts should be applauded, replacing the US market is going to be a daunting task.
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