Business
The United States has announced that it will terminate South Africa’s preferential trade benefits under the African Growth and Opportunity Act (AGOA) effective January 1, 2027.
The United States has announced that it will terminate South Africa’s preferential trade benefits under the African Growth and Opportunity Act (AGOA) effective January 1, 2027. The South African government said the decision does not define the broader relationship between the two countries and that a resolution depends on both sides being willing to engage in dialogue. U.S. Trade Representative Jamieson Greer said on Monday that, following an annual review, President Donald Trump had concluded that the policies of the governments of South Africa and Rwanda did not meet AGOA’s eligibility requirements. These include the removal of barriers that harm U.S. trade and investment, as well as avoiding actions that threaten U.S. national security and foreign policy interests.
South African Minister of Trade, Industry and Competition Parks Tau said: “This decision does not define the broader relationship between South Africa and the United States. However, a resolution depends on both sides being willing to find a solution.” He said the government would support affected sectors, protect national interests and continue seeking opportunities for trade, investment and economic cooperation with the United States. According to South African government figures, approximately 89% of South Africa’s exports to the United States in 2025 were subject to standard World Trade Organization most-favored-nation (MFN) terms, while only around 10% entered under AGOA, down from 28% in 2024.
Exports under AGOA were valued at approximately $1.7 billion, compared with $4 billion in 2024, representing about 1% of South Africa’s total global exports. Bilateral trade reached $28.8 billion in 2025, while more than 600 U.S. companies operate in South Africa, providing approximately 134,600 jobs. South Africa supplies the United States with 12 of the 50 categories of critical minerals and provides 70% of the isotopes used in cancer treatment in the United States.
The South African government said it would accelerate efforts to diversify export markets and explore opportunities in the African Continental Free Trade Area (AfCFTA), India, the Southern African Development Community (SADC), the European Union, the United Kingdom, ASEAN, the Southern Common Market (MERCOSUR) and China. New export opportunities have already emerged for South African citrus fruits, avocados, grapes and apples in alternative markets. South African organizations Solidarity and Lex Libertas criticised President Cyril Ramaphosa and Foreign Minister Ronald Lamola, accusing them of ignoring warnings about the deterioration of relations with the United States. They said ordinary workers and export industries would bear the consequences of the situation.
