logo
U.S. tariff: South Africa implements emergency measures to shield local exporters

U.S. tariff: South Africa implements emergency measures to shield local exporters

Business Insider16 hours ago
The government of South Africa has announced plans to draft emergency measures to support local exporters affected by the U.S. President Donald Trump's newly imposed 30% tariff; a policy shift expected to severely impact the country's automotive and agricultural sectors.
The South African government announced emergency measures to support exporters affected by the US's newly imposed tariffs.
These tariffs, set at 30%, target industries like automotive and agriculture, and are part of a US trade policy shift.
Negotiations with the US are open, while efforts to finalize a support package for impacted sectors continue.
The tariff, which was announced via an executive order on Thursday, is set to take effect within seven days and forms part of President Trump's broader push to reshape global trade in favour of the United States.
In response, the country's Trade and Industry Minister, Parks Tau announced the launch of an 'Export Support Desk' to assist affected businesses and help them identify alternative international markets.
The minister described the situation as 'a trying moment for South Africa,' underscoring the immediate risks to jobs and economic stability, a Reuters report confirmed.
President Cyril Ramaphosa also addressed the development, revealed in a press release that his government is finalising a support package for vulnerable exporters, with further details expected in the coming day
' All channels of communication remain open to engage with the U.S., and our negotiators are ready pending invitation from the U.S., ' Ramaphosa said.
The United States is South Africa's second-largest bilateral trading partner after China, importing a wide range of goods including automobiles, iron and steel, citrus fruits, and wine.
However, rising diplomatic tensions, fueled by disagreements over South Africa's foreign policy positions and domestic affirmative action laws, which the Trump administration has openly criticised, have clouded the trade relationship.
Trump unmoved by South Africa's tariff plea
According to Reuters, South Africa had spent several months attempting to negotiate a trade compromise with Washington.
Among its proposals were increasing purchases of U.S. liquefied natural gas and committing to investments in U.S. industries in exchange for tariff exemptions.
However, U.S. officials reportedly remained unresponsive.
The executive order signed Thursday imposes new duties on dozens of countries, many of them emerging markets, rekindling fears that African economies could become collateral damage in Washington's increasingly protectionist trade agenda.
While the establishment of the Export Support Desk has been welcomed by some stakeholders, political opponents questioned its adequacy. South Africa's official opposition party, The Democratic Alliance,, dismissed the initiative as 'laughable.'
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Nvidia's set to regain some China access. But it still faces eroding AI chip market share
Nvidia's set to regain some China access. But it still faces eroding AI chip market share

CNBC

time6 minutes ago

  • CNBC

Nvidia's set to regain some China access. But it still faces eroding AI chip market share

Nvidia's H20 chips are likely to return to China, but tech experts don't expect them to be met with the same fanfare in the market in light of new competition and regulatory scrutiny. The Trump administration last month gave Nvidia assurances that it would be permitted to resume sales of its H20 chips to China, after their exports had been effectively banned in April. It also announced a new "fully compliant" made-for-China chip. The move was seen as a huge win for the company, which had flagged billions in losses due to the policy. But while the H20s might be returning to the Chinese market that doesn't mean Nvidia will regain its former market share, analysts caution. In a recent report, global equity research and brokerage firm Bernstein forecast that Nvidia's AI chip market share in China would drop to 54% in 2025, from 66% the year prior. This drop is only partly owed to complications with resuming chip supply, as Chinese AI chipmakers have been seizing more of the booming domestic market. "U.S. export controls have created a unique opportunity for domestic AI processor vendors, as they are not competing with the most advanced global alternatives," Bernstein's report said, noting growing prominence of Chinese players such as Huawei, Cambricon and Hygon. "The localization ratio of China's AI chip market will surge from 17% in 2023 to 55% by 2027." Other analysts such as The Futurum Group CEO Daniel Newman were more bullish about Nvidia's bounce back in China. However, he also flagged potential market share erosion from Nvidia customers that might have found success with Chinese rivals while the H20 controls were in place. It's also worth noting that Bernstein's predictions assume that broader U.S. chip restrictions will remain largely unchanged. That creates a dynamic where Chinese companies continue to develop and offer advanced chips, possibly eroding demand for outdated U.S. offerings. Ahead of rolling back the H20 restrictions, Nvidia CEO Jensen Huang had been lobbying for more access to China, claiming export controls were inhibiting U.S. tech leadership. While Trump administration officials had said the rollback was part of trade negotiations, analysts have echoed Nvidia's basic argument that chip controls for the China market should be eased, thereby creating more dependency on U.S. tech offerings. "The assumption is that by keeping U.S. technology companies in the China game, the U.S. can preserve and even grow its geopolitical leverage," Reva Goujon, director at Rhodium Group, told CNBC. In a report last month, Rhodium Group said that this logic may see the administration shift to a "sliding scale" approach to export restrictions that could allow U.S. chipmakers greater access to China as Huawei and other Chinese chipmakers continue to upgrade. However, while Chinese AI developers will be happy to have increased access to Nvidia chips, Beijing isn't expected to slow its efforts to steer companies toward homegrown AI infrastructure, according to Goujon. She noted that the Cyberspace Administration of China's recent summons to Nvidia was an obvious signal of the state's intention to intervene in the local AI infrastructure market. According to the Cyberspace Administration of China, Nvidia met with Beijing officials on Thursday regarding national security concerns posed by the H20 chips, including potential backdoors that would allow parties in the U.S. to access or control them. Beijing's move appeared to come in response, at least partially, to new laws proposed in the U.S. that would require semiconductor companies such as Nvidia to include security mechanisms and location verification in their advanced AI chips. Nvidia later denied that its chips have any "backdoors" that would allow external access or control. The move by Beijing was also likely an attempt to create some hesitation among Chinese AI developers looking to buy the new H20s, according to Futurum's Newman. "China wants to leave some levers in place to potentially restrict outside AI chips at some point down the line if and when it feels its homegrown technology is truly competitive," Newman said. Beijing has previously restricted American chipmakers' business in China amid periods of intense technology and trade tensions between the two countries. Micron Technology, for instance, failed a cybersecurity review in 2023 and was subsequently blocked from critical IT infrastructure. "The continued complexity of China-U.S. trade relations could bring further complications [for Nvidia] as negotiations continue and as China attempts to cement its own AI strategy," Newman added.

Tankers Deliver Russian Crude to India Despite US, EU Pressure
Tankers Deliver Russian Crude to India Despite US, EU Pressure

Bloomberg

time6 minutes ago

  • Bloomberg

Tankers Deliver Russian Crude to India Despite US, EU Pressure

At least four tankers discharged millions of barrels of Russian crude at Indian refineries at the weekend, a sign the closely scrutinized deliveries are continuing as normal, even as the US ramps up pressure on the South Asian country to stop purchases. Oil traders and shipping companies have been waiting for direction from New Delhi on whether supplies from Moscow will be allowed to continue after US President Donald Trump last week threatened punitive action to curb trade with Russia. Over the weekend, a senior aide accused India of effectively funding President Vladimir Putin's war in Ukraine.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store