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Daily Maverick
15 hours ago
- Business
- Daily Maverick
Can SA forge a new consensus at G20 summit?
For the second time this year, the world's most powerful finance ministers have gathered in South Africa, this time at the lush resort of Zimbali north of Durban. But one minister will once again be conspicuous by his absence: that from the US. Scott Bessent, the mercurial US Treasury Secretary, has once again skipped the G20, choosing instead to send Michael Kaplan, the acting undersecretary for international affairs at the US Treasury. It all started when Secretary of State Marco Rubio refused to participate due to the host's vision of this year's G20 presidency being about 'Solidarity, Equality and Sustainability' — principles the current US administration theatrically rejects. In one sense, the timing of this South African presidency of the G20 could not be worse. Faced with the anti-globalist, protectionist bent of the US, what is usually a processional opportunity for showcasing a nation's soft power and producing vacuous missives about global cooperation has become a near impossible job of managing diplomatic fallout. As the first country from Africa to host the G20, South Africa had hoped to push issues vital for the very developing nations that stand to lose the most from the US president's trade war. With US aid budgets cut to virtual non-existence, and with tariffs about to decimate the export industries that, until now, had been the only hope for small African developing countries to build some semblance of a manufacturing sector, South Africa now finds itself managing the wreckage of international consensus. The G20 is a relatively new arrival to the international global system of forums and talk shops. Established as a response to the global financial crisis in 2008, the whole point was for countries like the US, the UK and the EU to include the faster growing nations of the Global South, which were becoming increasingly critical to the global economy. That promise now looks increasingly hollow. US vs the world: SA salvages G20 How naïve and quaint that looks, from the perspective of the realpolitik of 2025. In addition to Trump's threat of crippling levies on key trading partners from 1 August 2025, the US president has taken aim at the BRICS bloc of emerging economies — which includes host nation South Africa — threatening an extra 10% tariff for 'anti-American' policies. South African President Cyril Ramaphosa, following the BRICS summit in Rio last week, was the first of the group to hit back. 'The president of the US must recognise that multiple centres of power now define the global landscape,' he said. Ramaphosa is still trying to convince Trump to attend a G20 leaders' summit in Johannesburg in November, where he is due to hand over the presidency of the group to the US. But hopes that Trump will support any of South Africa's G20 initiatives have largely been extinguished. Under fire from corruption scandals at home, Ramaphosa's efforts are increasingly looking to be in vain. The G20 international outreach also follows a highly publicised Oval Office dressing-down, where Trump repeated false claims about a so-called genocide against white South African farmers. Still, despite Washington's aggressions, South Africa has no option but to press ahead with this week's meetings, which culminate on Thursday and Friday with sessions led by finance ministers and central bank governors. South African Reserve Bank governor Lesetja Kganyago and Finance Minister Enoch Godongwana will, at least, be in the limelight as opposed to the embattled president. The EU is now in the firing line It is not only developing countries that have been targeted by Trump. On Saturday, the EU received a typically condescending letter from Trump, threatening blanket tariffs on European goods. In a message that appeared to be copied and pasted from the one sent to South Africa and countless other recipients, Trump invited the EU to 'participate in the extraordinary Economy of the United States, the Number One Market in the World', while warning of sweeping new levies. His parting line, as ever: 'Thank you for your attention to this matter!' The proposed 30% tariff rate, together with existing sectoral duties and an expected levy on critical goods, would take the increase in the US effective tariff rate on the EU to a brutal 26%. According to estimates from Goldman Sachs, if implemented and sustained, it would lower euro area GDP by 1.2% by the end of 2026. The US is the largest trade partner of the EU, with the sum of exports from the EU totalling $815-billion in 2024. The EU understands that such a trade restriction with its biggest partner is nothing short of an existential challenge. In response, the bloc is actively seeking to diversify its trade ties. Besides Canada and Japan, the bloc is now fast-tracking agreements with India and other Asia-Pacific nations. Speaking from Beijing, EU competition chief Teresa Ribera confirmed that discussions with India are expected to conclude by year's end. 'We need to explore how far, how deep we can go in the Pacific area with other countries.' Africa will undoubtedly be next. Can South Africa lead a G19 without the US? Where the tariff war ends is anyone's guess. But with the US — the architect of the post-war global order — now acting as a destabilising force, the need for alternative alliances and renewed multilateralism between other parties has never been clearer. Already, the US absence has drawn others closer. After Rubio's withdrawal, the EU publicly endorsed South Africa's G20 agenda. Within weeks, the EU and South Africa held their first summit since 2018, marking a thaw in previously strained relations. Strangely then this year's G20 could prove to be its most consequential since its inception. Will it become the moment when the rest of the world reaffirms a commitment to open markets, trade and mutually beneficial cooperation? Or will it cement the beginning of the end for the rules-based global economy? In that sense therefore the timing of South Africa's G20 presidency could not be better. As a nation that once symbolised the post-Cold War liberal ideals of inclusion and equality, it is perhaps fitting that it should fall to us to rally the Global South and like-minded powers toward a new consensus. But the challenge is enormous. Can Ramaphosa — wounded politically and isolated diplomatically — rise to the occasion? Can South Africa lead a meaningful G19 in the absence of the US? To quote Tennyson's Ulysses, while 'death closes all, some work of noble note may yet be done'. The South African president may identify with the itinerant Greek after his own interminable political odyssey. Given his patchy track record in office, the answer may not be encouraging. And yet, history never asks whether leaders are ready. It simply presents the moment. Ramaphosa now faces his. DM
The Citizen
a day ago
- Business
- The Citizen
US tariff of 30% on SA exports: where to now?
Sky-high duties will hit dozens of US trading partners, as Trump pushes for more "reciprocal" or 'fair' trading terms. The new tariff of 30% president Donald Trump levied on South African exports to the US, as well as tariffs up to 50% on other countries, have reignited global tensions as the 90 day pause on the tariffs announced in April came to an end last week. Bianca Botes, director at Citadel Global, points out that it signals a sharp escalation in Trump's protectionist agenda. The latest round of tariffs include: Japan and South Korea: both were hit with 25% tariffs from 1 August. Trump cited trade imbalances and is pushing for local production in the US as the reason. Dozens are in the firing line, with over a dozen countries, including South Africa (30%), Bangladesh (35%), Brazil (50%) and Thailand (36%) facing increased tariffs. More are expected to follow, with an announcement of 30% tariffs for Mexico and the EU on the weekend. Brics, commodities and pharmaceuticals: A blanket 10% additional tariff on Brics imports was announced, along with a 50% duty on all copper imports, as well as a possible 200% tax on pharmaceuticals. ALSO READ: Ordinary South Africans will feel impact of US tariffs Lacklustre reaction from markets in response to US tariffs The market reaction was lacklustre and Botes says it seems that the markets are waiting for the dust to settle with minor responses in equities, which are currently hovering near record highs and some weakening in emerging market currencies, but not nearly to the extent that we witnessed in April. She also noted a global pushback, with affected countries exploring retaliatory measures or seeking last–minute talks, while the White House insists that 1 August is a firm deadline. 'The rest of July could be pivotal. Between Trump's hard tariff line and the Fed's cautious monetary policy stance, economic uncertainty is running high. Trump's aggressive approach may disrupt global supply chains and relations with allies and emerging markets alike. All eyes are now on incoming data and how markets, governments and central banks respond to what could be an unpredictable end to the month.' ALSO READ: Trump's new 30% tariff less about trade and more about power No mention of 10% US tariff for Brics in South Africa's letter Lisette IJssel de Schepper, chief economist at the Bureau for Economic Research, says although Trump warned that any country adopting the anti-American policies of Brics would face an additional 10% tariff, there was no mention of this in the letter South Africa received. Fellow Brics member Brazil got slapped with a 50% tariff on Wednesday. 'Unlike most countries facing reciprocal tariffs, Brazil runs a trade surplus with the US, importing more from the US than it exports, Trump makes it clear in his letter that the reason is political and he intends to penalise Brazil for the 'witch hunt' on former president Jair Bolsonaro.' De Schepper points out that Brazil is the US's largest coffee supplier and a significant supplier of iron ore. 'Trump, perhaps fearing that some of the reciprocal tariffs may be struck down by the courts, has ordered a so-called section 301 investigation into Brazil specifically. While this will take time, it could be a basis for sustained tariffs going forward.' ALSO READ: China's clever trade deal with Africa – removal of tariffs on most goods Trump: US tariffs based on 'common sense, deficits and raw numbers' President Cyril Ramaphosa responded to the announcement of the US's tariff by saying that the calculation it is based on uses the wrong data. Trump explained later in the week that the reciprocal tariffs are based on 'common sense, deficits, how we have been over the years and raw numbers'. She says arguing about the accuracy of data is therefore unlikely to sway his position. 'Hopefully, by highlighting what South Africa can offer the US and being pragmatic, there is some scope to wiggle down the tariff, as some other countries have successfully done. 'However, the 'worst case' of a 10% universal tariff that government hoped for now looks to be turning into a best case. However, a fair point made by the Financial Times is that there is unlikely to be a 'definitive policy' in a Trump world. While we expect the impact on the entire economy to be relatively small, some motor manufacturing and pockets of agricultural produce will be hit hard.' ALSO READ: Where Trump's tariffs will hurt most US 30% tariff on SA a seismic event, not a diplomatic spat Dr Ernst van Biljon, head lecturer and programme coordinator for M Com in supply chain management at the IMM Graduate School, says the sweeping 30% US tariff on 'any and all South African products,' is far more than a diplomatic spat. It is a seismic event poised to send ripple effects through global and South African supply chains, demanding an urgent re-evaluation of supply chain strategies. 'While global markets have always been dynamic, this escalation signals a deeper shift: the weaponisation of trade policy as a geopolitical tool.' He says from a global perspective, these tariffs immediately compel US-based importers and retailers to de-risk their supply chains. 'The 30% duty instantly inflates the cost of South African goods, making them less competitive on American shelves. This is not just about price but about the very viability of product lines. 'Supply chains in the US will face pressure to absorb costs, pass them to consumers, or seek alternative sourcing. This could accelerate trends towards 'friend-shoring' or 'near-shoring', where companies prioritise suppliers in politically aligned or geographically closer nations. 'The ability to guarantee consistent product availability and predictable pricing, even if it means re-evaluating long-standing supplier relationships, will become a key differentiator.' ALSO READ: Trump tariffs unsettle SA farmers as Africa eyes agricultural growth US tariffs could trigger global re-routing of goods Furthermore, he says, the tariffs could trigger a global re-routing of goods. 'South African products previously destined for the US might now seek new markets, potentially increasing supply in other regions and creating new competitive dynamics.' He warns that South African businesses cannot simply 'find new markets' or pivot messaging but must reimagine their entire value chain strategies. This means investing in regional value chain integration, leveraging SADC, Brics and AfCFTA frameworks and accelerating partial local beneficiation to improve resilience. For South Africa, the implications are immediate and profound, Van Bijon says. 'Businesses, particularly those in export-heavy sectors like agriculture, must urgently identify and cultivate new international markets beyond the US. 'This requires intensive market research and in the case of China, considerable persistence, to understand new consumer preferences and tailor product offerings and brand narratives for diverse audiences in Asia, the Gulf and within the African continent. 'Specific sectors such as citrus, wine, nuts and automotive components are directly in the crosshairs. Producers in these industries should consider building capacity for processing at source and establishing stronger ties with fast-growing Asian and Middle Eastern markets.' ALSO READ: Government must intervene with US tariffs, act stronger with police corruption Waiving US tariffs on goods made in the US? He says the US offer to waive tariffs if companies 'build or manufacture product within the United States' presents a stark choice. 'While some large corporations might consider this, it threatens to hollow out local manufacturing capabilities and job creation. 'From a domestic supply chain standpoint, this situation could galvanise 'Buy Local' campaigns, fostering national pride and consumer loyalty towards South African-made goods to bolster internal demand.' In addition, Van Biljon says, companies should assess opportunities to increase local supplier development and upstream integration to reduce reliance on single-market exports. 'Strengthening links with regional and Asian supply partners can enhance both resilience and cost competitiveness. 'The true opportunity is not in survival but in transformation — future-proofing South Africa's role in global supply chains through strategy, value creation and new market development.'
The Hindu
a day ago
- Business
- The Hindu
The View From India newsletter: Trump vs BRICS
(This article is part of the View From India newsletter curated by The Hindu's foreign affairs experts. To get the newsletter in your inbox every Monday, subscribe here.) The 17th BRICS summit, held in Rio de Janeiro, Brazil, triggered an angry response from U.S. President Donald Trump, after the grouping criticised his tariffs and condemned U.S.-Israel's attack on Iran. BRICS, which began as an economic acronym referring to Brazil, Russia, India and China (South Africa joined later), has evolved as the main institutional voice of the Global South. Last year, BRICS added five new members — Egypt, Ethiopia, the UAE, Iran and Indonesia. This year's summit had assumed greater significance because of the global faultlines. It took place just weeks after Iran, a member country, was attacked. In the summit, the member countries, often pulled into different foreign policy directions, showed unity on two issues — on Mr. Trump's tariff threats and the attack on Iran. The group's July 6 declaration raised 'serious concerns' about the tariffs, which it said were 'inconsistent with WTO rules'. The 10-member grouping also termed the strikes on Iran, which started on June 13 triggering the 12-day Israel-Iran war, 'a violation of international law and the Charter of the United Nations'. Member countries also 'expressed serious concern over any attacks against peaceful nuclear installations that are carried out in violation of international law and relevant resolutions of the International Atomic Energy Agency' and pledged to 'remain seized of the matter'. Mr. Trump lashed out at BRICS as 'anti-American' and threatened to impose an additional 10% tariffs on countries aligning with the policies of the grouping. 'BRICS is not, in my opinion, a serious threat. But what they're trying to do is destroy the dollar so that another country can take over and be the standard, and we're not going to lose the standard at any time,' he said. In addition to the threatened 10%, the Trump administration has slapped 50% tariffs on Brazil for the 'witch-hunt' against former Brazilian President Jair Bolsonaro, who faces charges of attempted coup. The U.S. has also imposed 30% tariffs on South Africa after accusing it of unequal trade. Besides, Republican Senators plan to bring a Bill called the Sanctioning Russia Act of 2025 that seeks to place 500% tariffs on imports of oil and sanctioned Russian products, which would hurt Russia, as well as India and China, its two biggest importers. This was not the first time Mr. Trump targeted BRICS. In January, immediately after he was sworn in for his second term, Mr. Trump called BRICS members 'seemingly hostile countries.' 'We are going to require a commitment from these seemingly hostile Countries that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs,' he wrote in a social media post. He had made a similar comment in November 2024 as well. Why is Trump attacking BRICS? Mr. Trump's irritation, writes Suhasini Haidar in this explainer, appears to stem from BRICS declarations in South Africa in 2023 and Russia in 2024, where members discussed a BRICS Cross-Border Payments Initiative that aims to facilitate trade and investment within BRICS countries using local currencies and other mechanisms. The initiative built momentum due to the problems Western sanctions on Russia have meant for trading partners in the Global South.' India has dismissed Mr. Trump's criticism that BRICS is anti-American. In March 2025, External Affairs Minister S. Jaishankar had said that India had no plans to replace the U.S. dollar. The government's focus is now on clinching a trade agreement with the Trump administration seeking to resolve the tariff disputes. But at the same time, India remains committed to BRICS, which now represents about half the global population, around 40% of the global GDP and a quarter of global trade. 'Despite all the challenges, the Rio declaration underlined the basic cohesion and consensus within BRICS members on a range of issues,' The Hindu wrote in this editorial. 'As India prepares for its leadership of the BRICS grouping next year, it can move forward with this consensus, fulfilling the vision for the grouping's acronym that Mr. Modi recast as 'Building Resilience and Innovation for Cooperation and Sustainability'. The Top Five 1. Global South | From the margins to the centre The 17th BRICS Summit in Rio de Janeiro, which saw members navigating different relationships with both the U.S. and Russia as well as global conflicts, offered a striking reflection of both the promise and the challenges facing the idea of South-South cooperation in the world today, writes Srinivasan Ramani. 2. Israel has failed to solve the Persian puzzle The 12-day conflict has not destroyed Iran's nuclear capabilities; this is a war that is far from over, writes Stanly Johny. 3. Rare earths emerge as a geopolitical lynchpin in the rising China-U.S. rivalry With China dominating the global rare earth supply chain and tightening grip over exports amid escalating trade tensions, the U.S. is now actively seeking alternative sources to reduce its strategic dependence, writes Smriti S. 4. Francesca Albanese | Shooting the messenger The UN Special Rapporteur, who has been sanctioned by the U.S., says 'all eyes must remain on Gaza, where children are dying of starvation in their mothers' arms', writes Adithya Narayan. 5. Grok | Troubling ascent The Elon Musk-controlled chatbot kicked off a controversy with praise for Adolf Hitler and controversial comments on the Jewish people, writes John Xavier.
The Journal
a day ago
- Politics
- The Journal
Students shouldn't be 'deprived' of J1 visas for expressing their views, Tánaiste says
STUDENTS SHOULD NOT be 'deprived' of a J1 visa for expressing their views on 'horrific issues that are happening around the world', Tánaiste Simon Harris has said. It comes after the US Embassy in Dublin announced last month that students applying for J1s will now undergo 'enhanced social media vetting' . A US State Department official said consular officers will conduct a 'comprehensive and thorough vetting of all student and exchange visitor applicants'. All applicants are now required to list all of their social media profiles and set them to public to allow screening for anti-American content, with anyone failing to do this running the risk of having their application rejected. The changes also apply for other exchange visitor applicants in the F, M and J non-immigrant classifications. The US embassy said it will use all available information in its visa screening to identify those who 'are inadmissible' to the US, including those who pose a threat to national security. Advertisement It said it wanted to ensure those applying for admission into the US 'do not intend to harm Americans and our national interests', adding that a US visa 'is a privilege, not a right'. The national students' union said the new measures represent a significant and disproportionate intrusion into personal lives and digital privacy, and that they raise serious concerns about freedom of expression and online surveillance. Speaking to reporters today following a meeting with US ambassador to Ireland Ed Walsh, Simon Harris said the two men had 'a really good conversation' about student visas. 'I think Ambassador Walsh knows the importance of the people-to-people connection between our two countries,' Harris said. 'Freedom of speech matters' 'I was making the point that we live in a country where young people have very, very strong views – as do I, by the way – on a lot of what's going on in the world and they have every right to express those views. 'Freedom of speech matters and being able to freely express yourself – online, offline, through protest – is an important part of our democracy, and I know President Trump is somebody who, I'd imagine in his own country, would champion free speech.' He added: 'We very much want our young people to continue to be able to articulate their very strongly-held views on horrific issues that are happening around the world, but that shouldn't deprive somebody from going on a J1.' Harris said that while immigration policy and visas is a matter for the US, he said he and the ambassador agreed to keep in touch on the matter. Related Reads We asked students queuing outside the US embassy what they make of new visa social media checks US embassy wants 'every social media username of past five years' on new visa applications 'Enhanced social media vetting' of foreign students for anti-American content 'Ireland and the US have been friends for hundreds of years. It's important we keep those connections going, and I wouldn't like to see anything that causes apprehension for a young person travelling to the United States – and I just made that point to Ambassador Walsh.' Taoiseach Micheál Martin previously said there should not be 'any overzealous examinations of people's records' when speaking about the matter. 'Obviously, authorities do monitor for potential criminal activity and that's generally done by the police services,' he said. 'But I wouldn't be in favour of any overbearing inquisitorial approach to young people or their social media for that matter in terms of traveling from here to the United States, or indeed to any other part of the world.' Martin said J1 visas 'work both ways', adding: 'It works very well for the United States in terms of a lot of workers in the hospitality sector.' Roughly 5,000 Irish students avail of the J1 visa programme every summer. Readers like you are keeping these stories free for everyone... A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article. Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation. Learn More Support The Journal
Bangkok Post
2 days ago
- Business
- Bangkok Post
YLG sees gold hitting $3,650 in H2
Gold trader YLG expects global gold prices to reach US$3,650 an ounce in the second half of this year amid tariff tensions and demand from various central banks. Bullion soared 25% in the first half of 2025, driven by escalating US trade tariffs, geopolitical risks and a surge in central bank gold purchases, said Pawan Nawawattanasub, chief executive of YLG Group. The precious metal, which was trading around $3,326 per ounce on July 8, could climb to $3,500 and potentially hit $3,650 per ounce in the second half of the year, she said. In 2024, gold posted a 27% annual gain, and over the past two decades, the average annual return has been 9.36%, according to YLG data. "Gold continues to benefit from a perfect storm of global uncertainty, ranging from economic volatility and trade tensions to geopolitical flashpoints," Mrs Pawan said. "Moreover, aggressive gold accumulation by global central banks and growing interest in gold exchange-traded funds [ETFs] are helping prices remain elevated." US President Donald Trump recently threatened a new 10% tariff on any country aligned with Brics, calling such policies "anti-American" on the Truth Social platform. Another support factor is geopolitical risks, notably the ongoing Middle East conflicts, fuelling investor flight to safe-haven assets. Many central banks are steadily increasing gold reserves, often buying at any price without selling. Gold-backed ETFs have recorded robust inflows as investors seek to hedge against inflation and currency depreciation. YLG projects if gold surpasses the $3,500 resistance level, the next upside target is $3,650 per ounce. For domestic investors, this could translate to a gold price of 53,800 baht per baht-weight, with a higher target of 56,200 baht, assuming the baht holds around 32.45 to the dollar. Despite recent volatility, Mrs Pawan said gold remains one of the most trusted, liquid and inflation-hedging assets. "Unlike fiat currencies, gold cannot be printed. It retains value and offers liquidity 24 hours," she said. To support broader access to gold, YLG has introduced several platforms for both seasoned and new investors. The Gold Wallet on the Paotang app enables investment in physical gold in USD, starting from 0.1 ounce per transaction, with real-time pricing and no trade limits. Another channel is the Get Gold app, with is tailored for first-time and small-scale investors, allowing entry- level investment starting from just 100 baht. Supporting real-time gold spot trading 24 hours, the app has gained traction among young, mobile-first users. For long-term strategies, YLG recommends the dollar-cost averaging method, which helps investors consistently accumulate gold while smoothing out price volatility over time. The app also allows users to schedule automatic recurring purchases, fostering disciplined investing. "Gold remains a resilient and strategic asset amid global turbulence. With demand from central banks and retail investors rising, the long-term outlook is firmly bullish," said Mrs Pawan.
