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Home Business & Economy

Should South Africa ditch AGOA?

by Editorial Staff
1 year ago
in Business & Economy
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Keypoints:

  • Trump expelled SA’s US envoy
  • AGOA renewal is at risk
  • SA urged to find new markets

THE political dynamics between the United States and South Africa are now teetering on a precipice, shaped by a dramatically shifting global landscape and the disruptive influence of President Donald Trump. As Washington continues to embrace a hardline, transactional foreign policy under Trump, the historical goodwill and strategic partnership that once underpinned US-South Africa relations are rapidly eroding.

South Africa is no stranger to diplomatic turbulence, but the current state of affairs is unprecedented. From the abrupt cancellation of aid programmes worth millions of rands to the controversial executive orders granting refugee status to Afrikaners, Trump’s administration has made its posture towards Pretoria crystal clear: assertive, punitive, and indifferent to historical ties. One of the most jarring developments came when Trump expelled South Africa’s ambassador to Washington, Ebrahim Rasool, with barely a week’s notice.

Rasool’s short-lived tenure—less than three months—ended unceremoniously, despite his efforts to build new channels with US lawmakers. At a Mapungubwe Institute webinar held in March, Rasool outlined how he had met with nearly 20 senators and congressional figures. But before the ink was dry on his remarks, US Secretary of State Marco Rubio took to X (formerly Twitter) to declare Rasool persona non grata.

Elon Musk and the politics of perception

Fuel has been added to the diplomatic fire by South African-born billionaire Elon Musk, who has used his platform to amplify dangerous and false narratives about his birth country—including claims of ‘white genocide.’ These unfounded statements have not only inflamed right-wing circles in the US but also given Trump further political cover to ramp up his antagonistic stance.

Trump’s appointment of Leo Brent Bozell III—a far-right commentator—as US ambassador to South Africa further underscores the administration’s confrontational posture. This isn’t just about one diplomat being expelled. It reflects a fundamental realignment in how the US views its relationship with South Africa.

Rasool, a seasoned diplomat who had been a regular on the Washington circuit during Barack Obama’s presidency, now finds himself edged out by Afrikaner lobbyists and unable to secure key meetings on Capitol Hill. Upon his return to Cape Town in March, he was met by hundreds of supporters at the airport, calling on President Cyril Ramaphosa to restore dignity to South Africa’s diplomacy.

Ramaphosa’s delicate balancing act

In response, Ramaphosa has chosen patience over panic. He told journalists in Johannesburg on March 26 that he would not be rushed into appointing a new ambassador. ‘The president appoints ambassadors and it’s within his sole right to appoint them,’ he said. While some see this as Ramaphosa reinforcing control, others interpret it as strategic hesitation in navigating a vastly changed world order under Trump.

What’s at stake isn’t just diplomatic decorum—it’s trade. South Africa’s largest trade pact with the US, the African Growth and Opportunity Act (AGOA), is up for renewal in September. All signs suggest that Trump’s ‘America First’ policies and his aggressive tariff approach could see South Africa excluded.

The AGOA countdown

Only a third of South Africa’s exports to the US benefit from AGOA. Yet, it remains a lifeline for several key industries, from automobiles to citrus. Introduced in 2000, AGOA provides duty-free access to the US market for over 1,600 products from eligible African nations. South Africa, as the US’s largest trading partner on the continent with $20 billion in two-way trade (2020 data), has the most to lose.

Last year, US lawmakers began questioning South Africa’s eligibility for AGOA, citing its strengthening ties with Russia and China. With Trump in the White House and his well-known disdain for multilateral deals, the outlook is bleak.

Ramaphosa’s government insists it will not overreact. ANC International Relations Chair Supra Mahumapelo has called for calm, noting that South Africa remains committed to a relationship that has spanned over 50 years. However, within the business community, alarm bells are ringing.

Strategic diversification now critical

The urgency for South Africa to explore new markets and strengthen intra-African trade has never been greater. Should AGOA be scrapped, nearly 600 US companies operating in South Africa—and the close to 200,000 jobs they support—could be at risk. Trump’s legacy of punitive tariffs across sectors like steel, aluminium, and cars makes it unlikely that South Africa will be spared.

This moment calls for more than reactive diplomacy. It requires a strategic recalibration of South Africa’s foreign economic policy. Waiting for AGOA’s cancellation is no longer an option. Diversifying trade routes and reducing dependency on the US market must be a top priority.

While President Ramaphosa treads carefully in choosing a new ambassador, South Africa must begin preparing for a future that may no longer include preferential access to the US market. In the era of Trump, diplomacy alone won’t protect national interests—resilience and reinvention will.

Cyrstal Orderson is a  Journalist and Freelance Writer for the Insitute for Justice and Reconciliation

 

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Editorial Staff

Editorial Staff

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