Everything you need to know about the US-SA tariffs

Daily Maverick

01-08-2025

The Trump administration has set a non-negotiable deadline of 1 August for imposing new tariffs on the countries with which the US trades. Here's where South Africa stands.
What's the background to the 1 August deadline?
US President Donald Trump is obsessed with tariffs, which is a very weird 18th-century mercantilist preoccupation: tariffs used to fund governments before taxes were invented.
There is evidence to suggest that Trump has been yapping about tariffs for more than four decades: at some point in the 1980s he decided that tariffs were the silver bullet to unlock unheard-of US prosperity, and no one has been able to persuade him against it, even though virtually all economists say he is wrong.
He also sees tariffs as a way of resetting US trade terms with other countries — he feels that the US has been taken advantage of — and is using them as leverage to achieve various political goals. None of this is fair, justified, or reasonable, but, unfortunately, we all live in Trump's world now.
In April, Trump announced tariffs for different countries based on a nonsensical formula which, it was later determined, had almost certainly been generated by ChatGPT. Since then, in a kind of demented game that Trump would have relished, countries have been scrambling to negotiate deals for themselves before an entirely arbitrary deadline of 1 August, on which the tariffs with trading partners will be set.
Could South Africa get an extension on the 1 August deadline?
Given the absurdity of the situation whereby every single one of the US's major trading partners is attempting to get an audience with a limited number of US trade negotiators, an extension to the deadline might seem — there's that word again — reasonable.
But…
'THE AUGUST FIRST DEADLINE IS THE AUGUST FIRST DEADLINE – IT STANDS STRONG, AND WILL NOT BE EXTENDED,' Trump trumpeted on Truth Social on Wednesday, 30 July.
Somewhat confusingly, however, US Commerce Secretary Howard Lutnick told Fox News on Sunday that further negotiations and deals were still possible after the incredibly inflexible deadline.
What will South Africa get hit with?
Probably 30% tariffs on its US exports.
There are certain elements of South African social media who are hell-bent on claiming that this is some kind of unique punishment for the sins of President Cyril Ramaphosa, but the truth is that South Africa's likely tariff rate looks quite average.
Canada looks set to get hit with 35%; Mexico, 30%; Thailand, 36%; Laos and Myanmar, 40%; Bangladesh, 35%; and Brazil — more about this in a second — 50%.
But the fact that South Africa is not unusual in being hit with these tariffs doesn't mean they are inconsequential. In the Eastern Cape in particular, terrible job losses are being predicted as a result of the hit on the automotive sector; see Estelle Ellis's piece here.
What do we know about the progress of negotiations so far?
Very little, because both the South African and US negotiating teams are under a non-disclosure agreement, so don't believe everything you see floating around on social media.
We know, thanks to comments made by Agriculture Minister John Steenhuisen, that the first proposed trade deal between South Africa and the US was rejected on 20 May for not being 'ambitious' enough, and so the South African team sweetened the initial deal.
This was confirmed by the Dirco director-general, Zane Dangor, on Tuesday.
Dangor also said that 'extraneous issues' were clouding the matter, and that certain 'demands' were being made by the US team on 'domestic policy' — with BEE a central concern.
On Wednesday, Trade and Industry Minister Parks Tau said the South African team was being encouraged to 'resubmit' a last-minute 'enhanced' proposal — with extra pork in it. Literally.
What exactly is the US demanding from South Africa in terms of domestic policy?
Again, we don't know, because all these talks have been happening behind closed doors between trade negotiators, with no formal, public statement of demands: that's not how tradecraft works.
The Afrikaner delegation that visited Washington in June and met with 'representatives from the Office of the Vice President, the National Security Council, and the Homeland Security Council' claimed that US officials had presented them with four non-negotiable conditions to communicate to the South African government to achieve a reset of relations with the US.
These just happened to be four issues very close to the heart of the Afrikaner political lobby, coincidentally enough.
They were: the prioritisation of farm attacks; the condemnation by the ANC of the song 'Kill the Boer'; no land expropriation without compensation; and the exemption of US businesses from BEE requirements.
It's hard to know how much of this might be wish-fulfilment from the Afrikaner delegation, since they were not there operating with any official South African mandate.
What do we know about the criteria Trump's team are using to arrive at the tariffs?
It seems like a heady mix of political vendettas, Trump's personal hyper-fixations and perhaps some economic considerations. But you would be demented to assume that the Trump administration is operating in good faith, and that some perfect (white, male) South African negotiator could have unlocked the perfect deal by uttering some magic words.
For the best possible illustration of how the Trump administration is approaching this, see Brazil, which is likely to get hit with 50% tariffs, in large part because Trump's ally Jair Bolsonaro is facing criminal charges for trying to incite a coup.
Trump used the trade negotiations to try to meddle in a sovereign country's justice system, demanding that the charges be dropped. This is, by the way, almost certainly illegal — but we are far past that point now.
This is what South Africa is up against.
Would it have helped to have a South African ambassador in place, or at least a trade envoy who could get a US visa?
It surely wouldn't have hurt. But let's look at the example of India: India has been locked in trade talks with the US since March, while its external affairs minister, Subrahmanyam Jaishankar, has been 'camped in the US for months', to quote one commenter. Indian Prime Minister Narendra Modi has been practically spooning Trump, diplomatically speaking. And India still looks likely to get hit with 25% tariffs, proving that there is no guaranteed value to sucking up to Trump.
As the days to the deadline have ticked down, South Africa has packed off Dirco Minister Ronald Lamola, one of the ANC's coolest heads, to Washington.
In addition, Tau said on 702 on Wednesday that the South African government had 'pulled out all the stops' to try to engage on the trade matters: sending delegations from ministers, business, civil society and even Cosatu.
'From all angles, we have continued to engage with the US,' he said.
What's in the deal we're offering the US?
South Africa would buy 75–100 petajoules of liquefied natural gas from the US over 10 years; the US would simplify its poultry export rules so South Africa could buy more US chicken products; and South African companies would pledge about $3.3-billion (R59-billion) in US projects, especially in mining, metals recycling and related 'critical minerals', plus pharmaceuticals and farm machinery.
In exchange for measures like these, South Africa is hoping that certain key industries — like shipbuilding and farming produce that can't be grown locally at the same time (counter-seasonal agriculture) — would be kept free of tariffs, as well as small-scale exporters.
What if South Africa refused to supply minerals to the US in retaliation?
This is something Mineral Resources Minister Gwede Mantashe has hinted at several times as a potential retaliatory measure, and one of the only forms of leverage South Africa has: the US is dependent on South African platinum group metals, such as chrome, gold and manganese, for its car industry. Withholding those exports from the US is a nice little revenge fantasy.
But News24's Lisa Steyn has a good explainer on why this move isn't feasible: partly because it would hit South African mining companies the hardest, and partly because these metals are sold to multinational companies rather than to countries.
What happens next?
We brace for impact. And remember to thank Uncle Donald once his tariffs stunt the world's economic growth, as is already happening. DM