South Africa Aims to Cut 30% US Tariff With Revised Trade Offer
South Africa will submit a revised trade-framework deal to the US as it seeks to reduce a 30% tariff imposed by President Donald Trump.
“We went to cabinet last week and got approval of what would constitute the latest offer to the US,” South Africa Trade, Industry and Competition Minister Parks Tau told reporters in the capital, Pretoria, on Tuesday. Tau said he will submit the documents to the US “now.”
A 30% tariff on South Africa’s goods entering the US came into effect on Aug. 7, part of the Trump administration’s effort to reshape Washington’s relationships with its trading partners. The levy threatens about 30,000 jobs in South Africa, particularly in its auto and agriculture industries, according to the trade department.
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The tariffs imposed by Trump place South Africa among four countries — the others being Brazil, China and Switzerland — that have effective tarrifs that are “significantly higher” than their competitors, Oxford Economics said in a report on Tuesday.
“Tariff rates relative to your competitors in US import markets matter,” Gabriel Sterne, head of global emerging market research at Oxford, said in a research note. “Their losses are every other economy’s relative gains.”
South Africa’s trade-negotiation team submitted an initial proposal to the Trump administration in May, after the US president paused tariffs he originally announced in April to allow nations to strike bilateral pacts by an Aug. 1 deadline.
China Trade
Over the past two weeks, Pretoria has been working to enhance its offer at the behest of American trade representatives.
The tariffs, which are disrupting global supply chains, are forcing nations to seek alternative markets, with South Africa eying China and other Asian countries for new customers.
South Africa expects to conclude a deal next month to export stone fruit — including apricots, peaches, nectarines, plums, and prunes — to China, Agriculture Minister John Steenhuisen said at the briefing.
“It’s the first time that China has negotiated more than one product with us at a time,” Steenhuisen said. “We hope to conclude this protocol on the sidelines of the G-20 next month.”
South Africa, which hosts G-20 agriculture ministers at a meeting scheduled to take place on Sept. 16-17, will next negotiate for mangoes and cherries to be shipped to China, while it’s in talks with Japan to export grains including corn.
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— With assistance from Robert Brand
This story was produced with the assistance of Bloomberg Automation.