Ramaphosa warns South Africa of ‘devastating’ impact if US trade deal is lost
South African President Cyril Ramaphosa has warned that his country must prepare for possible exclusion from a key US duty-free trade programme, saying the economic consequences could be “devastating” as diplomatic tensions between Pretoria and Washington deepen.
South African President Cyril Ramaphosa has warned that his country must prepare for possible exclusion from a key US duty-free trade programme, saying the economic consequences could be “devastating” as diplomatic tensions between Pretoria and Washington deepen.
The African Growth and Opportunity Act (AGOA) provides eligible African countries with preferential access to the US market. South Africa is a major beneficiary, with its automotive industry among the sectors that could be affected if the country loses access to the arrangement.
Ramaphosa said Congress had voted to retain South Africa in the programme, but the process still required executive approval from US President Donald Trump, according to his remarks reported by AFP.
“What now remains is the executive,” Ramaphosa said, warning that the country should prepare for the possibility of being removed from the arrangement.
He added that South Africa would not be the first country to lose AGOA eligibility and urged citizens not to view a possible exclusion as the end of the country's economic prospects.
Automotive industry faces potential risks
The potential loss of preferential access could have serious implications for South Africa's export-dependent automotive sector.
Under AGOA, South African vehicles can enter the US market without the customs duties that would otherwise apply under the programme. The automotive industry is one of the country's major export earners to the United States, after precious metals, according to the supplied report.
Industry figures cited in the report indicate that about 86,000 jobs at car manufacturers were directly tied to the trade arrangement in 2025. The number rises to 125,000 when subcontractors are included, according to automotive employers' organisation Naamsa.
The figures underline the potential employment consequences of a change in US trade policy, although the actual impact would depend on the terms of any exclusion and how businesses respond.
Ramaphosa said his government would seek alternative export markets to reduce the effects of a possible withdrawal from AGOA.
US-South Africa relations deteriorate
The trade uncertainty comes amid worsening relations between the two countries over foreign policy, diplomatic disputes and disagreements about South Africa's domestic policies.
The supplied report cites US foreign aid reductions, the expulsion of South Africa's ambassador and confrontations over allegations of a “white genocide” as developments that have strained relations.
South Africa disputes the allegations and has defended its constitutional framework for land reform.
Washington also announced visa restrictions targeting South Africans it accuses of promoting race-based discrimination, inciting violence or enabling land confiscation without compensation. These claims remain contested by Pretoria.
The disagreements have added political uncertainty to an important economic relationship, leaving South African businesses facing questions about future access to the US market.
South Africa considers alternative markets
Ramaphosa said South Africa was continuing to engage with American officials while looking to strengthen trade relationships elsewhere in Africa and Asia.
The government is seeking to reduce its vulnerability to changes in US policy, although the supplied report does not specify which alternative markets could replace the trade benefits provided by AGOA or how quickly that could happen.
The programme has previously excluded other participating countries. Former US President Joe Biden announced the removal of the Central African Republic, Gabon, Niger and Uganda in October 2023, with the exclusions taking effect in January 2024.
Under the process described in the report, an exclusion requires 60 days' notice to Congress and the country concerned.
The report also identifies 2 November as the deadline for an exclusion to take effect from the following 1 January.
The immediate question is whether the US administration will approve South Africa's continued participation or pursue its removal.
For Ramaphosa, preparing for that possibility is now essential, even as his government continues diplomatic engagement to protect the country's trade interests and the jobs that depend on them.