Business

Two Weeks to Disaster: SA Businesses Brace for Trump’s Tariff Bomb

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2 months ago

July 14, 2025

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Citrus, cars, and jobs on the line as US prepares to hit SA with punishing tariffs

South Africa is staring down the barrel of a devastating economic shock, with just two weeks left before the United States imposes a sweeping 30% tariff on South African exports.

The deadline, 1 August 2025, has sent panic through boardrooms across the country. From citrus farms in Limpopo to auto plants in the Eastern Cape, business leaders are scrambling to brace for the worst.

Announced by US President Donald Trump as part of a broader shift in trade policy, the tariff hike threatens to gut key sectors of South Africa’s already fragile economy, with jobs, towns and livelihoods hanging in the balance.

“This is another Covid moment for business”

That’s the stark warning from Business Leadership South Africa (BLSA) CEO Busi Mavuso, who likened the looming impact to the economic carnage of the Covid-19 lockdowns.

“This will ripple through entire supply chains. Jobs will be lost. Small businesses that feed into big exporters will collapse,” Mavuso said in a sobering statement this week.

She urged government to act with the same urgency it showed during the pandemic: “We need TERS-like support. We need a tariff impact fund. We need help, now.”

Automotive and agriculture sectors hit hardest

The automotive industry, particularly concentrated in the Eastern Cape, is already reeling from a 25% tariff imposed in April. Add another 30% and the sector could be knocked out cold.

Last year, the US imported R35 billion in luxury cars and parts from South Africa, a third of which came from small and medium suppliers. Many of those companies, Mavuso said, simply won’t survive.

The citrus industry, a world leader and critical seasonal supplier to the US, is also facing a potential bloodbath. With R1.8 billion in citrus exports and 140,000 jobs on the line, towns that depend on fruit-packing season could be hollowed out.

Wine, beef, and even flowers are expected to suffer collateral damage.

There’s no time to pivot

While some South African firms are trying to diversify their markets, Mavuso said it’s not realistic to expect an overnight shift. “Securing new trade routes and production models takes years. We’ve got two weeks.”

She said this short window may be enough to negotiate a temporary reprieve or at least minimise the damage, but only if government acts urgently and decisively.

Trade still matters, but diplomacy is stalling

US trade accounts for 2.2% of South Africa’s GDP, and while some raw materials, like platinum, chrome, gold, and coal are exempt from the tariffs, the most labour-intensive sectors are not.

Ongoing diplomatic engagement between Pretoria and Washington has yet to yield concrete relief. Economists now say what was once considered a “worst-case scenario” a 10% tariff might be the best we can hope for.

What’s needed now? A Plan B and fast

Mavuso has laid out a roadmap:

Set up a Tariff Impact Fund to keep viable businesses afloat
Revive TERS-style relief for affected industries
Fast-track market diversification strategies with urgent state support
Keep diplomatic channels open, but don’t wait for miracles

“We cannot be left scrambling for solutions once the damage is done,” she said.

The political backdrop

Some analysts say South Africa’s position in the US-Africa trade pact AGOA has become vulnerable due to Pretoria’s foreign policy, including its stance on Russia, Israel, and BRICS expansion. Others warn that Trump’s return to more protectionist trade policies is less about South Africa and more about sending a signal to global markets.

Either way, South African exporters are caught in the crossfire.