SOWETAN SAYS | Government must act swiftly on the 30% US tariffs

SA is racing against time to put together a new strategy to renegotiate planned tariff hikes by the US on SA imports set to begin on August 1.

On Monday, US president Donald Trump notified SA that Washington would impose a blanket 30% tariff on SA exports, excluding select sector specific duties.

The announcement, though not unexpected, has brought about uncertainty in key sectors of our economy such as agriculture, the motor industry and iron and steel. SA primarily exports platinum, vehicles, agricultural products such as citrus as well as aluminium products to the US.

These sectors are particularly critical in our economy, not only for jobs but also for our economic growth prospects. Because the US is one of the world’s leading economies and markets for our exports, the damage of higher tariffs will be huge and likely to hurt our economic growth rate.

According to agriculture minister John Steenhuisen, Monday’s announcement will likely signal the end of the African Growth and Opportunity Act (Agoa).

Through Agoa, more than 6,000 products and goods from SA, including those from textile industries, enjoyed duty-free access to the US market.

It is evident therefore that the planned tariff hike is also likely to reduce trade between SA and the US on some of the imports which could have far-reaching consequences for jobs in the sectors impacted. This is also because the US is SA's second largest trading partner.

According to the department of trade, industry and competition, SA is urgently seeking a meeting with the team from the US to understand Trump’s decision to impose a 30% tariff hike on SA exports.

The government must put the interest of our country first when negotiating with the US in the next 30 days if we are to get any reprieve from the adverse impact of the tariff hike. Our leadership must calmly and firmly seek to strengthen cooperation between SA and the US and encourage Washington to reconsider its action.

We fully support the government’s efforts to negotiate with Trump’s administration on the lowering of the tariffs and encourage it to do whatever it takes to convince Trump without compromising the sovereignty of our country.

The risks of not doing anything about this are too high to contemplate. Given the evolving global trade landscape, SA companies must also consider diversifying their markets in preparation for changes in trade relations and seize opportunities as they arise.