Agoa deal turns to lemon as SA exclusion sparks job fears

The United States' decision to exclude South Africa from the African Growth and Opportunity Act (Agoa) trade program on January 1st is a significant setback, according to many influential figures. Corné Mulder, leader of the Freedom Front Plus, warned that the ramifications are extensive, leading to substantial job losses across various sectors.

The general economy and key industries like agriculture and vehicle manufacturing are expected to suffer greatly. This exclusion is blamed by some on President Cyril Ramaphosa and International Relations Minister Ronald Lamola, who will face billions of rands in lost export revenue, particularly from the automotive and agricultural sectors.

Industry analysts estimate that between 125,000 and 500,000 jobs could be directly or indirectly affected. AgriSA CEO Johann Kotze called for continued diplomatic efforts and practical measures to safeguard agricultural competitiveness, as the country's agricultural exports to the US totalled $504 million (around R8.3 billion) in 2025, a 3% decline from the previous year.

Despite the exclusion, South African vehicles will still be sold in the American market, but will face standard US tariffs. The Motor Industry Staff Association reported that the vehicle industry suffered a severe blow in August when the Automotive Business Council Naamsa revealed that the 25% Section 232 tariff on vehicles and components, imposed in 2025, negated the benefits of Agoa.

Consequently, South African vehicle exports to the US plummeted by 83.2%. Wandile Sihlobo, South Africa's agricultural envoy, added a 3.4% tariff on top of the existing 12.5%, which could rise to 15.9% for affected products. AfriForum deputy CEO Werner Human attributed the situation to the South African government's foreign policy and the recent Expropriation Act signed on January 23rd, 2025.