In the aftermath of the Donald Trump victory in the United States, there’s consensus among commentators that South Africa’s flourishing trade with the United States under the African Growth and Opportunity Act (Agoa) faces a major turning point.
In a letter to the newly elected president and his government, trade union Solidarity has called on him and his government to maintain the good trade relations South Africa has built up with the USA.
It was also specifically requested Agoa be upheld.
In the letter, the chairperson of the Solidarity Movement, Flip Buys, mentions that approximately one in 37 South African households relies on exports to the USA to put food on the table.
Buys emphasises how approximately 20% of these households depend directly on Agoa and that they would not be able to survive without it.
According to Theuns du Buisson, economic researcher at the Solidarity Research Institute (SRI), South Africa cannot afford to continue without this trade agreement.
“Agoa often benefits precisely those people in rural areas where there is not much other economic activity. For this reason, it is essential that this agreement remains in place for the sake of South Africa’s most vulnerable workers.
“Africa has numerous communities of the same kind where trade with the world’s largest economy would not be possible without Agoa. This is where the difference between poverty and prosperity lies,” Du Buisson said.
Moreover, around 30 000 of Solidarity’s members work in industries that benefit specifically from Agoa.
The Solidarity Movement’s head of international liaison, Jaco Kleynhans, is currently in the USA as a representative of the organisation, and he has followed the election closely.
During his visit he will have talks with numerous influential players in the newly elected government in order to emphasise South Africa’s dependence on the trade agreement.
The organisation’s efforts are, however, unlikely to make any impact.
During his previous administration, Trump said the scheme would not be renewed when it expired in 2025.
And since ‘Tariff Man’ Trump has proposed various tariff policies, including tariffs of up to 20% on all imports not out of China and 60% on Chinese goods, the efforts of Solidarity are not likely to make much of a dent in his policies.
In a message to the South African Government of National Unity (GNU), Solidarity has warned the GNU to be cautious of jeopardising economic ties and trade benefits with the USA through hasty policy decisions and statements.
