South Africa targets Asia, Middle East as Trump tariffs escalate trade tensions

IOL News

5 days ago

South Africa is moving swiftly to cushion its economy from the fallout of tariffs imposed by the United States under the Trump administration – tariffs that officials say South Africa did not deserve.
Image: Ron | IOL
South Africa is moving swiftly to cushion its economy from the fallout of tariffs imposed by the United States under the Trump administration – tariffs that officials say South Africa did not deserve.
In response to the ongoing trade challenges, during a joint press briefing, Trade, Industry, and Competition Minister Parks Tau as well as John Steenhuisen, Minister of Agriculture, outlined a multi-pronged strategy to mitigate the economic impact, sustain exports, and diversify trading partnerships.
'I think it's in their interest as well to have a good relationship with the most industrialised and largest economy on the continent. But also, to make sure that we're not putting all our eggs in one basket and that we are looking to turn looking for other markets,' said Steenhuisen.
Steenhuisen added: 'I don't think that it would be fair to penalise South Africa for being part of a regional block like BRICS (Brazil, Russia, India, China, and South Africa), which obviously is our prerogative as a country… 'Some of them have obviously been slapped with far more punitive tariffs than we have.'
The plan includes intensified engagement with the US, new economic response packages, tariff adjustments, and a push into alternative markets in Asia, the Middle East, and India.
'So not only is it a function of us sitting on our hands, as some have alluded to, it's a function of the fact that there are processes that we are required to follow,' said Steenhuisen.
Key elements include addressing energy and privacy measures, opening market access for poultry, and introducing mitigation measures for blueberry exports, all aimed at fulfilling US trade concerns. The US Africa trade desk has begun shipping poultry and pork from states such as Georgia, Mississippi, and California to South Africa, signalling a commitment to maintain agricultural trade flows despite tariffs.
At the same time, South Africa is considering reducing tariffs on certain goods to manage trade deficits and align more closely with tariff rates applied by the European Union, thereby improving competitiveness.
Economic Response and Export Support
A central feature of the government's response is the Economic Response Package, which established an Export Desk that has already assisted 23 companies. This initiative is complemented by a working capital facility and a plant equipment facility designed to support transport needs across various industries.
Consultations with the Competition Commission have resulted in a draft block exemption to enable exporters to collaborate more effectively. The draft is expected to be published this week, accelerating efforts to support export coordination.
Diversifying Markets and Regional Partnerships
Recognising the risks of over-reliance on traditional trading partners, South Africa is fast-tracking diversification efforts. New market opportunities are being actively pursued in Asia, the Middle East, and India, where demand is rising and South African goods enjoy a positive reputation.
The government is also enhancing dedicated infrastructure to expand market reach and increase export certification capacity, critical steps to ensure readiness for new trading partnerships.
As part of a broader regional strategy, South Africa assumed chairmanship of the Southern African Customs Union in mid-July, with the first meeting focusing on trade measures and deepening cooperation with neighbouring countries.
Demand-side measures and domestic growth
South Africa is amplifying outreach to corporates and retailers through online platforms and market access programmes aimed at boosting domestic procurement and export capabilities.
Although the US accounts for roughly 4% of South Africa's total agricultural exports – valued at R9.8 billion rand – the government remains committed to keeping this market open while simultaneously accelerating diversification. For context, South Africa's gross domestic product is worth R7 trillion.
Agricultural innovation and sustainability
The Department of Agriculture is promoting initiatives such as increased wheat production and support for emerging farmers. Efforts include transforming traditional sugar plantations into ethanol and sorghum plantations as part of a broader sugar master plan aimed at clean energy production.
A biofuels strategy is underway, with the government fast-tracking the regulatory and legislative framework to meet global demand. Industry players like Sasol are positioned to lead technological advancements in this space.