Ramaphosa responds to Trump’s 30% tariff on South Africa

South African President Cyril Ramaphosa said there’s the prospect that the US may lower a planned 30% tariff on goods in ongoing talks with Washington, as he challenged its calculation of the new levy.On Monday, US President Donald Trump unveiled a wave of promised letters that threatened to impose higher duties on American trading partners, signalling that he was open to discussions on the increased tariffs until at least 1 August.The announcement came hours after the US leader threatened to impose an additional 10% levy on all countries that form part of the BRICS economic bloc.“South Africa will continue with its diplomatic efforts towards a more balanced and mutually beneficial trade relationship with the US,” Ramaphosa said in a statement.“We welcome the commitment by the US government that the 30% tariff is subject to modification at the conclusion of our negotiations with the US.”The rand weakened as much as 1.7% in the wake of Trump’s announcement, leading declines among its emerging-market peers. It traded 0.3% stronger at 17.8089 by 8:20 a.m. in Johannesburg on Tuesday.The US is the largest destination for South African exports after China, accounting for $8.8 billion last year, data from the tax agency shows.Major exports range from precious stones and metals to organic chemicals and edible fruit. South Africa’s goods-trade surplus with the US was $2.2 billion last year.Ramaphosa said the calculation of the 30% tariff was “not an accurate representation” of available trade data, arguing that in Pretoria’s interpretation, 56% of goods enter South Africa at a 0% most-favoured nation duty, with 77% of US goods entering South Africa under the 0% levy.“This contested interpretation forms part of the issues under consideration by the negotiating teams from South Africa and the US,” Ramaphosa said.Trump’s announcement came two weeks after a round of talks in which US Assistant Trade Representative for Africa Connie Hamilton said the US would present a template for all trade deals on which Washington plans to engage in sub-Saharan Africa.In response, South Africa asked for a suspension of the proposed tariff while reworking its offering to be in line with the template.Pretoria has yet to receive that template and Ramaphosa has instructed his negotiating team to “urgently engage” with the US on the basis of a framework deal it submitted on May 20.Ramaphosa also urged trade negotiators and local companies to “accelerate their diversification efforts in order to promote better resilience in both global supply chains and the South African economy.” - BLOOMBERG

Ramaphosa responds to Trump’s 30% tariff on South Africa

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Ramaphosa responds to Trump’s 30% tariff on South Africa

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