South Africa presents revised trade offer to the US amid tariff concerns

Banele Ginidza

South Africa on Tuesday submitted a revised offer to the trade negotiations with the United States (US), which it described as broad, ambitious and likely to meet the demands of that country as it looks for means of allaying the 30% tariffs imposed last week.

In a joint presentation, Minister of Trade Industry and Competition (the dtic), Parks Tau, alongside Minister of Agriculture John Steenhuisen said the new offer substantively responds to the issues the US has raised in the 2025 National Trade Estimates Report and builds on the previous offer submitted in May.

"This is a broad, generous and open offer that I think meets the ambition criteria, if you are to look at the trade and tariff perspective it represents something that will be good for the US and also for SA," Steenhuisen said.

"We hope it will be received this way in the US, obviously, the demands both in meetings with the Trade Representative and at the White House the focus was on the trade and tariffs not on domestic policy issues outside." 

The ministers said South Africa has already addressed sanitary and phytosanitary measures in compliance with the bio-security protocols affecting poultry, blueberries and pork with the first shipment of meat products expected in South Africa shortly from the US.

They said the measures will ensure that the US is able to leverage the Tariff Rate Quota of 72 000 tons already agreed in 2016. 

They also said a high-level negotiation team, including both the dtic and the agriculture department has been identified and was ready to engage the US towards a mutually beneficial agreement.

"Our goal is to demonstrate that South African exports do not pose a threat to US industries and that our trade relationship is, in fact, complementary," the ministers said.

"While the US is our 3rd largest trading partner after the EU and China, South Africa is the 43rd export destination for the United States and accounts for 0.25% of total US imports and is therefore not a threat to US production."

They said as the US market accounted for about 4% of South Africa's total agriculture exports, or R9.8 billion of total agricultural exports, an increase of 104% from 2018.

"The government is going to do everything possible to keep the American market open for our goods. We will at the same time accelerate our efforts to diversify markets and build on the efforts we have put in place to ensure predictability in trade and leverage all our existing partnerships to secure markets for our products," they said.

Another significant request from the US was that South Africa consider reducing tariffs as a way to address the deficit and tariff disparity with the European Union due to the SADC-EU Economic Partnership Agreement."

Tau also announced that consultations were under way with industry and members of the Southern African Customs Union (SACU) regarding ways to respond to a request from the US for South Africa to consider reducing tariffs as a way to address the deficit and tariff disparity with the EU due to the SADC-EU Economic Partnership Agreement.

Tau said South Africa has accelerated its diversification efforts of export markets and enhanced competitiveness to mitigate the economic impact of losing preferential trade access. The diversification is a strategic imperative to ensure better resilience of our economy to economic shocks.

"This is not a plan B; it is a plan A for long term resilience and competitiveness. We are committed to strengthening our relationships, particularly under the AfCFTA, to build regional resilience," Tau said.

"We will also continue the work we have started with our European partners towards enhancing our trade and investment relations in a manner that unlocks sustainable growth and development and entrenches South Africa in new supply-chains.  We are looking at Asia, including Japan, Vietnam and Thailand, the Middle East and India."

Tau said the markets were being pursued because of growing demand, existing negotiations and a positive reception to South African products.  

"This is not just about trade numbers; it is directly linked to job protection. Diversification is about protecting rural livelihoods and sustainable agricultural growth for our people," he said.

"To achieve this, the government is deploying dedicated infrastructure for market expansion, including trade and agricultural attachés, increased export certification capacity and a concerted effort to align our biosecurity standards with the requirements of these new markets." 

BUSINESS REPORT