While lower United States tariffs were good news for South Africa, the country could face additional and possibly higher tariffs in the months ahead.
The warning came from FairPlay founder Francois Baird in an article in Business Day. He said that, while the 30% “reciprocal” tariffs had been invalidated and replaced by 15% global tariffs “there may be worse to come”.
President Trump has said he would use other US legislation to achieve his tariff goals, and that the 15% tariffs on all countries, imposed under different legislation, are only a start.
“He also warned that he will continue to deal harshly with countries with whose policies he disagrees. This could bode ill for South Africa.”
The new 15% tariffs could only be in effect for 150 days in terms of Section 122 of America’s 1974 Trade Act. President Trump had made it clear that he intends to use those 150 days to “determine and issue the new and legally permissible Tariffs”.
Baird highlighted other legislation that the Trump administration had identified.
“Section 338 of the Tariff Act of 1930 may also be used. It authorises the president to impose tariffs of up to 50% on imports from any country that ‘discriminates’ against US commerce as compared to other nations.”
Baird said South Africa had alienated the American government by aligning itself with China, Iran, Hamas and Russia.
South Africa faces the risk of being found to “discriminate” against the US because of its anti-American alignment, anti-dumping duties and general tariffs imposed on US poultry imports. A White House fact sheet last April singled out pork and poultry for what the US saw as unfair import restrictions.
South African trade negotiators had offered a permanent import quota of 72 000 tonnes of US chicken annually, free of the anti-dumping duties that would otherwise apply.
“Sacrificing South African poultry, the second most competitive producers in the world, was clearly premature. What is the situation now that lower tariffs are in place?” Baird asked.
South Africa’s membership in the AGOA trade agreement that gives select African countries duty-free access to the US market was still at risk. Countries had been added and deleted from the AGOA list by many administrations.
“Some countries, like eSwatini and India have played a shrewd trade game. Hopefully the South African government will use this temporary reprieve to find solutions for its self-created trade risks,” Baird said.
