The White House has announced adjusted “reciprocal tariff rates” scheduled to take effect next week, on 7th August.

Ramaphosa has stated that negotiations with the US will continue, but it seems a fait accompli that South Africa will face a 30% tariff on all exports to the United States, with some caveats.

• Firstly, there are crucial exemptions for precious and base metals as well as strategic minerals, pharmaceuticals and some wood products. Key for SA amongst these would be gold, PGMs, coal, etc., which make up the bulk of our exports to the US and would not be subject to any tariff rate.

 

• Steel (25%) and automotive (25%) exports are subject to their own separate tariff rate, which does not stack with the 30%.

SA’s hardest-hit export categories will be those that export to the US and are not exempt in any way. These are agricultural products, particularly citrus, grapes, macadamia nuts and wine. These tariffs effectively nullify AGOA, which will be cancelled in September regardless. The other big negative impact will be on manufactured goods, especially vehicles, and we are already seeing vehicle exports take a knock.