With the African Growth and Opportunity Act (Agoa) having expired on 30 September 2025, the uncertainty over its renewal has raised pressing questions about the future of South Africa’s trade relations with the US.
South Africa accounts for 54% of all exports to the US under Agoa — a trade law which gives eligible African countries duty-free access to the US market for thousands of products including clothing, agricultural goods, crafts and manufactured items.
The country’s exports under the pact are worth about R71.5 billion ($3.1 billion) a year, supporting thousands of high-value jobs in the automotive, agriculture, apparel and equipment sectors.
Business Leadership South Africa chief executive Busi Mavuso said President Donald Trump’s administration had indicated a desire to extend Agoa by a year shortly before its expiry, but Congress has not acted on that because of the ongoing government shutdown.
“There remains a possibility that an extension could be included in legislation required to end the shutdown, but even then, it is unclear whether South Africa would be included, given the broader issues that have arisen between our two countries,” said Mavuso.
Relations between Pretoria and Washington have been frosty due to differences over the Israel-Palestine war, South Africa’s policies, such as those on land expropriation and broad-based black economic empowerment, and its cooperation with nations such as Iran, Russia and China.
The Trump administration slapped South Africa with a 30% trade tariff which came into effect on 7 August and which President Cyril Ramaphosa’s government says will shave off 0.4% from GDP growth and affect 30 000 jobs across sectors such as the automotive and citrus industries.
Pretoria has tabled an undisclosed framework deal to Washington and set up an export support desk to assist companies affected by the tariffs.
Even if South Africa were included in the Agoa renewal, the impact would be “effectively nullified by the imposition of tariffs”, Mavuso said.
Ramaphosa advocated for the renewal of Agoa at the SA-US trade dialogue in September, telling investors that Pretoria’s goal is to sustain and expand trade flows, to keep companies competitive and to ensure that consumers and workers in both countries benefit from the partnership.
An analysis of the country’s export composition over the past 15 years shows gradual shifts, said Elna Moolman, Standard Bank Group’s head of macroeconomic research.
“We’ve seen some changes in the relative importance of different regions for SA’s exports over the years, though significant change tends to take time. This shows that 11% of SA goods exports were destined for the US 15 years ago, compared to 8% in July 2025,” she said.
Moolman however noted that for Africa, US exports have increased from 25% to 27% over the same period. Notably, South African exports to Europe have also increased from 25% to 27%. China is South Africa’s largest individual trading partner at 12.3%.
Mavuso said the South African government’s approach had been “appropriately pragmatic”, establishing a ministerial committee to negotiate tariff reductions with the US while pursuing alternative markets.
“On the sidelines of the G20 programme, we’ve seen a flurry of efforts to diversify trade and support economic resilience in an increasingly multipolar world. Countries are reducing their dependency on single markets, recognising that concentrated trade relationships create vulnerabilities that can be exploited during geopolitical tensions,” she said.
She added that South Africa’s relationship with the EU was flourishing, with total trade increasing by 44% over the past five years. The EU accounts for 41% of total foreign direct investment in South Africa and more than 2 000 European companies support over 500 000 jobs locally.
In 2024, vehicle exports to the EU grew by 19%, with Europe accounting for more than half of South Africa’s total automotive exports, valued at R147.1 billion. Germany, Belgium, Spain and the UK were the leading destinations, with Germany alone importing R83 billion worth of vehicles and components.
China has also announced duty-free access for all African nations with which it maintains diplomatic ties. The Chinese ambassador to South Africa Wu Peng recently said the Asian superpower would increase agricultural imports from South Africa and increased trade would lessen the blow of US tariffs.
The Brics bloc, which accounts for 21% of South Africa’s exports, also offers several trade opportunities, as does the African Continental Free Trade Agreement, though the latter faces significant implementation challenges around infrastructure and regulatory harmonisation, Business Leadership South Africa noted.
Asked about the performance of the National Logistics Crisis Committee and whether its progress could influence South Africa’s Agoa prospects or broader trade diversification, Moolman said, “We are encouraged by the improvements in the logistics sector so far, though this should be seen as the beginning of a multi-faceted structural change over several years.”
She noted that Statistics South Africa data shows that rail freight volumes were 9% higher in the second quarter of 2025 than in the first quarter of 2023.
“The implementation of policy reforms to ease South Africa’s binding growth constraints continues, thereby underpinning a credible expectation for higher trend growth. However, such structural reforms by nature take time and new headwinds and risks this year have delayed the growth improvement that was expected at the beginning of this year,” Moolman said.
Mavuso noted that Transport Minister Barbara Creecy had announced the allocation of rail slots to 11 new train operating companies across 41 routes and six corridors — a reform Business Leadership South Africa had long advocated..
“These 11 new entrants are preparing to move 20 million additional tonnes of freight annually from 2026/27, and will be able to participate in funding for future growth, which is a testament to what can be achieved when we move beyond the tired rhetoric of public versus private and focus on solutions,” she said.
Asked about her expectations from the upcoming South Africa-US Investment Forum, Mavuso said: “As the business community, we would like a reset in bilateral relations between South Africa and the United States, with a renewed focus on shared economic interests and mutual benefit.
“We would hope that our efforts to have key export products exempted (for example, autos, auto parts, steel, aluminium) would be successful. It would be hugely beneficial for our economy if we can have the tariffs reset to 10% maximum and special exemptions for SMEs, counter-seasonal goods or goods the US doesn’t domestically produce.”
Mavuso said the forum would press for Agoa’s renewal and modernisation.
“The United States remains our second-largest export market, with approximately 600 American companies operating domestically and US investment stock standing at roughly $7.5 billion. These relationships, built over decades, cannot be easily replaced and must be emphasised as South Africa continues to try to salvage its relationship with the US,” she added.
Business and economic leaders warn that diplomatic tension, tariffs and shifting global alliances could shape whether the country remains part of the renewed agreement
