Ramaphosa warns South Africa to prepare for possible loss of US-Africa trade deal

South African President Cyril Ramaphosa warned on Monday that the nation must prepare for the potential loss of its place in a crucial U.S. trade agreement. The African Growth and Opportunity Act (AGOA) remains in effect through the end of 2028, making South Africa its primary beneficiary. However, political disagreements and policy disputes have escalated between Washington and Pretoria.

The U.S. Congress previously approved South Africa's inclusion in the trade framework, but the final step requires executive approval from President Donald Trump. Ramaphosa stated that Congress has decided to keep South Africa in the agreement, leaving only the executive decision remaining. He cautioned that South Africa has not been the first or only nation to face exclusion from AGOA and that the country must be ready for such a possibility.

Diplomatic tensions have intensified since the current U.S. administration took office, including reductions in foreign aid, the expulsion of South Africa's ambassador, and disputes over claims of a "white genocide." In September, the U.S. imposed visa restrictions on South Africans who promote "race-based discrimination, incite violence, or enable land confiscation without compensation."

South Africa disputes these allegations but defends its land reform policies. The U.S. conducts annual eligibility reviews for AGOA participants and requires 60 days' notice to Congress and the country concerned before exclusion takes effect on January 1. Washington announced that Gabon, Niger, Uganda, and the Central African Republic were excluded in October 2023.

South Africa is looking for alternative markets to minimize the impacts of any exclusion, which could devastate the country's economy, as it is the second-largest exporter of cars to the U.S. after precious metals, and nearly 125,000 jobs are directly tied to the agreement.