South Africa: Staying ahead of the impact of US tariffs on exports
Market expectations are that overall US tariffs will remain higher than before. South Africa must therefore remain proactive.
By Lullu Krugel, Chief Economist and Africa Sustainability Leader, PwC South Africa
On 2 April 2025, US President Donald Trump announced sweeping increases in tariff duties on imported goods from almost all countries around the world, with South Africa facing a rate of 30%.
On 9 April 2025, the US announced a universal 90-day pause on the increased tariffs from a week earlier to a uniform 10%, while the increased tariffs on Chinese imports were reduced from 145% to 30% after bilateral negotiations. China also reduced their own reciprocal tariffs on US goods from 125% to 10%. While this is seen as a promising sign that could potentially lead to established tariff ranges for countries – market expectations are that overall US tariffs will remain higher than before. South Africa must therefore remain proactive. Businesses and policy makers must prepare for a post-pause period to safeguard South Africa’s trade interests.
Higher tariffs will significantly impact on the global trade community – affecting various industries – raising concerns about the future of international trade relations. The increased tariffs are expected to disrupt supply chains, raise costs for consumers, and affect foreign direct investment and competitiveness across multiple industries.
Director-General of the World Trade Organisation (WTO) Ngozi Okonjo-Iweala has expressed deep concern about the uncertainty in global trade policies, especially the US-China stand-off. She indicated that “the recent de-escalation of tariff tensions has temporarily relieved some of the pressure on global trade. However, the enduring uncertainty threatens to act as a brake on global growth, with severe negative consequences for the world, particularly the most vulnerable economies.”
The WTO estimates that world merchandise trade will shrink by 0.2% in 2025, after growing by 2.9% in 2024. Without high tariffs and uncertainty, trade growth could have been 2.7% in 2025 and 2.9% in 2026. Africa's export growth is expected to slow from 0.7% to 0.6%
Despite these challenges, Okonjo-Iweala remains enthusiastic because “WTO members have the unprecedented opportunity to inject dynamism into the organisation, foster a level-playing field, streamline decision-making, and adapt our agreements to better meet today's global realities”.
As we explore the top export chapters impacted by these tariff changes, we will uncover the effects on South Africa's economy and the critical steps needed to protect its trade interests.
From precious metals and automotive exports to agricultural and chemical products, we will look at the chapters that are most vulnerable to tariff hikes and potential strategies to mitigate their impact.
To provide a comprehensive understanding of these tariff changes, we conducted and initial analysis focusing on the top 10 highest export chapters from South Africa to the US – including chapters with the highest percentage proportion of its total exports directed to the US. This dual approach captures both the absolute and relative significance of these exports – offering a balanced view of the economic impact.