By Lehlohonolo Lehana.
Minister of Trade and Industry Parks Tau has reiterated South Africa’s stance that negotiations remain the best tool for dealing with the current US tariffs impasse.
Tau’s comments comes few days before the August 1 deadline for the imposition of a 30% ‘reciprocal tariff’ on those South African goods exported to the US.
The intersection of geopolitical, domestic and trade issues best defines the current impasse between South Africa and the United States, and a reset is unavoidable,” Tau said, while stressing that South Africa had no intention of decoupling from the US and had refrained from imposing reciprocal tariffs of its own.
Tau and Mcebisi Jonas, special envoy to the US, have deployed a blend of deal-making and diplomatic signalling aimed at resetting bilateral terms before deadline to stave off the higher duties.
South Africa remains dedicated to the process, awaiting substantive feedback from its US counterparts regarding the final status of their Framework deal.
The proposed Framework deal includes several key areas.
- Energy Imports: Importing 750 to 100 petajoules of Liquified Natural Gas (LNG) over ten years, which could generate $12 billion.
- Agricultural Market Access: Streamlining US poultry exports under the 2016 tariff rate quota, potentially unlocking around $91 million in trade. South Africa is also prepared to allow blueberry exports, pending the necessary protocols.
- South African Investments in the US: South African companies plan to invest $3.3 billion in U.S. industries, including mining and metals recycling.
- Joint Investment Opportunities: Both governments will work together on investments in critical minerals, pharmaceuticals, and agricultural machinery.
- Tariff Exemptions: Certain sectors may be exempt from reciprocal tariffs to protect supply chains, including shipbuilding, counter-seasonal agriculture, and exports from Micro, Small, and Medium Enterprises (MSMEs) earning less than $1 million annually.
He also noted that South Africa was not the only country seeking a deal with the US, which was attempting to finalise negotiations with some 185 countries by August 1.
“As the Department of Trade, Industry and Competition, we have been in a period of intense negotiations with the United States.
“We have signed a condition precedent document and have readied our inputs for entry into the template which is to follow from the US.
“Despite the challenges that have been presented by this period, we have put our best foot forward, bringing together the subject specialists within our ranks that have dug deep to ensure that our country is adequately prepared for a number of potential scenarios,” Tau added.
US tariffs have effectively nullified the AGOA preferential trade deal, under which certain goods from eligible African countries could enter the US levy-free.
Meanwhile Minerals and Petroleum Minister Gwede Mantashe has called for the introduction of mandatory local processing quotas, saying South Africa must stop exporting its mineral wealth in raw form, along with the jobs and profits that come with it.
Speaking at the G20 Critical Minerals Stakeholder Engagement in Johannesburg on Tuesday, Mantashe said beneficiation must become non-negotiable.
“We must set quotas and say X percentage of what is mined must be processed in South Africa. That will ensure that we add value here,” Mantashe told delegates.
South Africa is one of the world’s most resource-rich nations, sitting atop vast reserves of platinum group metals, lithium, manganese, rare earths, and coal, all essential inputs for clean energy technologies like batteries, solar panels, and electric vehicles.
Mantashe also stressed that trade must occur on fair and equitable terms.
“We should never be bullied for our own resources. If people want to trade with us, it must be in terms that are mutually beneficial to both us and them.”
With global demand for critical minerals skyrocketing, South Africa is positioning itself not just as a supplier,but as a builder of value-added, job-creating mineral economies.