South Africa prepares for US trade framework amidst Trump's tariff uncertainties
Image: Independent Media Archives
Banele Ginidza
The ongoing evolution of trade relationships between the United States and sub-Saharan Africa has entered a critical phase as the USA moves towards establishing a new trade-matters template.
This template will guide its future engagements with African nations, a development revealed by Deputy Minister of Trade, Industry and Competition, Zuko Godlimpi, following discussions last week with the US Assistant Trade Representative for Africa, Connie Hamilton.
On the heels of South Africa's submission for a proposed Framework Deal aimed at bolstering trade and investment relations with the US, the government has urged local businesses to brace themselves for potential changes poised to emerge from this new framework.
Godlimpi's dialogue with Hamilton occurred during the recent US-Africa Summit in Luanda, Angola, where pertinent issues surrounding reciprocal tariffs were also addressed.
While the proposed Framework Deal, submitted on 20 May 2025, underscores measures designed to resolve trade deficits and promote bilateral investment, its future may hinge on the forthcoming US internal approval process.
The expiry of a 90-day tariff freeze, initially set for 9 July 2025, has raised concerns within the South African government about the adequacy of this timeline.
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Next
Stay
Close ✕
As such, African countries are collectively advocating for a deadline extension to allow adequate preparation for aligning their proposed deals to the forthcoming US template.
The Minister of Trade, Industry and Competition, Parks Tau, said South Africa welcomed this indication and expressed a preparedness to engage with the said template once finalised.
'In this regard, we are of the view that South Africa may need to re-submit its Framework Deal in accordance with the new template. It is thus expected that the deadline may be shifted,' Tau said.
The government is keen to ensure that the new requirements do not unduly disadvantage local enterprises, hence the appeal for strategic patience from the South African industry.
Prospectively, South Africa's Framework Deal aims to tackle a range of US concerns, including non-tariff barriers and longstanding market access issues.
It seeks specific exemptions from Sections 232 duties for key export products such as automobiles, auto parts, steel, and aluminium, ensuring these critical sectors can remain competitive in the US market.
South Africa is also seeking the maximum tariff application of 10%, as a worst-case situation. The Framework also seeks exemption for Small and Medium Enterprises, counter-seasonal products and products that the US does not have productive capacity for.
'We urge the South African industry to exercise strategic patience and not take decisions in haste and that the government will continue to use every avenue to engage the US government to find an amicable solution to safeguard South African interests in the US market,' Tau said.
As South Africa navigates these complexities, international sentiment has shifted towards urgency.
The New York Times recently reported that governments around the globe were racing to negotiate trade deals with the US in order to forestall President Donald Trump's punishing tariffs.
Trump announced what he referred to as 'reciprocal tariffs' on April 8, saying they were in response to other countries' unfair trading practices. However, he agreed to pause those levies for 90 days to give countries time to reach trade deals with the US.
The coercive nature of previous tariffs has spurred conversations across the globe about fair trade practices, with Trump signalling readiness to impose tariffs on countries perceived as uncooperative—compounding existing anxieties surrounding the impending July deadline.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
IOL News
an hour ago
- IOL News
Astral Foods calls for government support as bird flu vaccination programme expands
At any one point, Astral runs with about 4 million broiler breeders in stock although the company will not necessarily be vaccinating all of them. Image: Supplied Tawanda Karombo Astral Foods, which is planning to expand its recently approved bird flu vaccination programme, wants the government to ease conditions for such initiatives and to finalize payments of compensation to the industry for birds culled to control diseases in the past few years. This appeal comes in the wake of mounting challenges within the poultry industry, which has been grappling with heightened biosecurity risks following successive bird flu outbreaks. Gary Arnold, CEO of Astral Foods, told Business Report in an interview on Tuesday that the company will ramp up its poultry vaccination against bird flu. This comes after the company on Monday announced that the Department of Agriculture had approved its bird flu vaccination program at one of its farms in the country. 'It's only 5% being vaccinated. We do have plans to expand it. We'll have to (expand it), now that we have firmed up the process with the Department of Agriculture,' Arnold said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ However, the company said it would be helpful if the government sped up compensation payments to the industry for birds culled as a disease control mechanism. Arnold, nonetheless, reckons that 'bio-security is the responsibility of producers' as the government doesn't have resources and ability to go around to everyone's farm enforcing it. The government had to aid the industry to enhance bio-security through easing regulatory processes and procedures. 'The government can help through regulatory reforms. The conditions under which we are allowed to vaccinate are very stringent and expensive because you have to comply with all the monitoring and surveillance and this makes it very difficult for everyone to vaccinate,' said Arnold. The South African Poultry Association has been engaging industry regulators over the past 18 months to thrash out a set of guidelines that the industry believes are less onerous to implement but still enforceable. The industry is pursuing recognition of conditions around which producers can vaccinate without exposing the whole industry to any unnecessary risk. This comes at a time when the South African poultry industry is facing heightened biosecurity risks. This has made it imperative for industry players to be extra careful of risks assocxiated with spreading the disease. 'Monitoring and surveillance of flocks is extremely important once they're vaccinated, (but) that is also a cost attached to that, but it is critical to ensure the safety of the livestock in South Africa,' explained Arnold. But with the approval of the vaccination program for one farm, Astral Foods hopes to 'expand this to include other' farms it runs. Arnold added that the company's intention was always 'to get one blueprint farm going that could guide both the Department of Agriculture and ourselves' on the process. The vaccination against bird flue costs the company about R2 to R2.50 per bird over its life cycle. It is a necessary cost for Astral which together with other industry players in SA and globally that nolonger have access to bird flue insurance. 'Astral used to pay a premium for bird flu insurance. Now, bird flu insurance is no longer available to any producer in this country and globally… They stopped it after 2023 because of the large claims that they had against them on the severe outbreak in 2023 so that was the last time that insurance cover was available,' Arnold revealed.
IOL News
2 hours ago
- IOL News
Sports department rubbishes Gayton McKenzie's alleged bias against Cape Town's F1 bid team
They said the BSC was 'vague' about stipulations around the deposit. In order to bid to host the F1, each group had to submit an application motivating their location as well as making a deposit of R10 million. CTGPSA wanted to pay the deposit with a promissory note, which is a legal document outlining their intended loan repayment structure. CTGPSA also raised concerns about the BSC's handling of the R10 million deposit, which was part of the bid application process. Cape Town has proposed a street-style circuit, similar to that of Monaco. CTGPSA, this week, suggested that the Minister of Sport Gayton McKenzie acted in the best interests of Kyalami's F1 bid and labelled the Bid Steering Committee (BSC) as a biased group, who also acted in Kyalami's interests. The Department of Sports, Arts and Culture ( DSAC) has called the allegations made by the Cape Town Grand Prix SA (CTGPSA) team as 'utterly baseless'. 'On 7 December 2024, Gayton McKenzie stated 'the race is going to happen at Kyalami' and this was before announcing the BSC, looking at other bids or doing economic assessments. The fact that minister McKenzie appointed the BSC cannot just be overlooked as trivial, especially given how things played out after this. 'Then, when the bid document was put out, we were given fewer than 10 days to submit our entire proposal, including a R10 million deposit – a bid to host a major global sporting event. Only after we pushed for an extension to encourage a fair process did an extension emerge. 'We respect the BSC and minister McKenzie and we want to work with them. But as a proudly South African bid, we hold fairness, accountability and a legacy for our country in high regard. We believe our plan offers the best shot at a successful, long-term F1 future on the African continent,' CTGPSA said. The group questioned how the BSC used the R10 million deposit, what triggered a refund, the timeframe of the refund, whether or not the funds would be held in an interest bearing account and if there was an audit trail. 'We feel alternative submissions received to be more comprehensive, viable and suited for the purpose,' was the response CTGPSA said it got from the BSC, which raised even more concerns. 'A payment of a deposit of R10 million to support an open bid submission should NOT be the determining factor as to whether a bid is considered or not, particularly when it does not make any changes to the economics of a bid." Stacey-Lee Khojane, spokesperson for the DSAC refuted CTGPSA's claims and said that all bids were judged fairly. 'The bid process was open to anyone who wished to submit a bid. All of the bids were judged fairly and objectively by the BSC. The minister was not a part of that process. Their allegations are utterly and totally baseless,' Khojane added. The BSC has acknowledged CTGPSA's remarks, but have not yet respond to Independent Media's enquiries about the allegations.
IOL News
2 hours ago
- IOL News
S&P upgrades African Bank rating, affirms South African banking sector stability
African Bank store in Cape Town. The banks credit rating was upgraded by the international credit rating agency S&P Global, which expected that the bank will continued to scale and diversify in futrure, without negatively impacting Image: File S&P Global Ratings has upgraded African Bank's long-term global scale issuer credit rating to 'B+' from 'B,' with a stable outlook, and affirmed the short-term global scale rating at 'B.' - the only local bank to have its rating raised by the issuer, while the ratings of other banks were affirmed. S&P Global affirmed the ratings of Absa Bank, BNP Paribas Personal Finance South Africa, Capitec Bank, FirstRand Bank, Investec Bank, Nedbank, and the Development Bank of South Africa. 'In our view, the South African banking system is now in an expansion phase,' S&P said on its website. On African Bank, S&P said the upgrade reflected the bank's more supportive economic environment, coupled with strong capitalisation that partially compensated for its weak asset quality indicators. 'We expect African Bank will continue to scale and diversify, particularly in retail… we do not expect a significant inflow of non-performing loans from the new production,' the rating agency said. African Bank welcomed the latest S&P Global Ratings upgrade as recognition of its progress on strengthening its balance sheet, diversifying its offerings, and reaffirming its founding purpose: to make banking accessible to all South Africans,' CEO Kennedy Bungane said Wednesday. 'This upgrade acknowledges the work we have put in over the last few years and gives us further confidence we are on the right track. It reflects on our financial performance, capitalisation, and improved asset quality while expanding our offerings to our customers,' Bungane said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ He said that as the bank marked 50 years, the new rating would enhance its reputation and position it strongly towards becoming a listed institution, which was another step in it's commitment to build a customer-centric, digitally enabled diversified business that is scalable and sustainable. The S&P announcement follows hard on the heels of African Bank's interim results for the six months to March 31, 2025, which saw net profit after tax increase by 15% to R202 million. The group also reported a 20% rise in net advances to R39 billion, 6% growth in customers to 6.1 million, and non-interest income growth of 38%. 'Our growth has been driven by a disciplined approach to risk and compliance management, diversification of our balance sheet, and increased digital enhancements across the business. The Excelerate strategy is positioning us to deliver long-term value for stakeholders,' said the bank's CFO Anbann Chetti. Key strategies included leadership alignment for a listed environment, regulatory compliance, and inclusive ownership models that reflect African Bank's founding values: 'We are building a future-fit bank with the scale and agility to serve more South Africans,' Bungane said. On the local banking sector outlook, S&P said they expect cautious credit growth and moderate increases in real estate prices in the next couple of years. They expect South Africa's GDP to likely rise by 1.5% on average over 2025-2028, after only 0.6% in 2024. 'We expect investment in infrastructure, including logistics and renewable projects, will create lending opportunities for banks. We also anticipate household lending will increase at a measured pace supported by the reduction in interest rates,' the global rating agency said.
