Reserve Bank Governor Lesetja Kganyago calls for dialogue to ease US-South Africa tensions

IOL News

25-04-2025

South Africa Reserve Bank governor Lesetja Kganyago and Finance Minister Enoch Godongwana call for dialogue to ease tensions
Image: Supplied/SARB
The ongoing diplomatic tensions between South Africa and the United States (US) have been scrutinised, with Reserve Bank Governor Lesetja Kganyago attributing the rising tensions to a lack of proper diplomatic engagement.
Speaking late Thursday evening after meetings with G20 finance ministers and central bank governors, Kganyago expressed concern that the escalation of trade disputes could have lasting impacts if not addressed through meaningful dialogue.
The tensions stem primarily from the Trump administration accusing South Africa of genocide against white minorities and the government's decision to take Israel to the International Court of Justice for the ongoing genocide in Gaza.
The US government cut all future funding to South Africa, disrupting the country's healthcare system.
This was also part of the broader context of US trade policy under the Trump administration, which saw the imposition of tariffs on numerous countries, including South Africa.
Earlier this month, Trump announced a 10% tariff on all imports to the US and additional reciprocal tariffs for dozens of countries, including 30% for South Africa.
Days later, after global financial markets took a pummelling, he suspended the reciprocal tariffs for 90 days, placing all countries on the 10% tariff.
While the US argued that tariffs were necessary to protect American industries, South Africa and other affected countries viewed these measures as disruptive and potentially harmful to global economic growth.
The lack of clear communication and diplomatic engagement further complicated efforts to find common ground. Kganyago's Warning: The Need for Dialogue
During his remarks, Kganyago emphasised the importance of open communication and warned that current tensions might hinder future cooperation.
'It means that we might not be talking to each other, that we need to open the dialogue so that we talk to each other," he said.
"We are coming to the point where the tensions have become so elevated that even when a hand is being extended, we might not see that because things have become so certain."
He underscored the urgency of re-engaging in diplomatic talks, noting that the current environment—marked by heightened tensions and mutual suspicion—risks fostering a cycle of disengagement.
"It's important that those conversations take place, especially as the days are becoming fewer and the environment is increasingly uncertain," Kganyago stressed. South Africa's Diplomatic Approach
South African Finance Minister Enoch Godongwana, who co-headed the G20 finance ministers' meeting, confirmed that US Treasury Secretary Scott Bessent attended some sessions.
Despite the presence of US officials, the South African delegation decided against issuing a formal communique after the talks, citing deep divisions among the participating countries over how to handle the ongoing trade disputes.
The tensions have reverberated through global financial markets, with stock and bond markets experiencing volatility this month. South Africa's G20 Agenda
Amidst these challenges, South Africa's presidency of the G20 this year has focused on critical issues, including economic growth, food security, energy security, and climate change.
The country aims to leverage its platform to promote dialogue and cooperation. Still, the current state of US-South Africa relations underscores the importance of diplomatic engagement in achieving these goals.
As tensions persist, Kganyago's call for renewed dialogue highlights the need for diplomatic efforts to de-escalate the situation.
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