What Losing AGOA Benefits Could Mean for South Africa
- South Africa could face an additional 3.4% tariff on agricultural exports to the US if it loses its AGOA benefits, pushing some products to 15.9%
- Economists warned the exclusion could trigger job losses in manufacturing
- President Cyril Ramaphosa previously acknowledged that losing AGOA access could have devastating consequences for the economy
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SOUTH AFRICA — Following US President Donald Trump's announcement that he intends to remove South Africa from the African Growth and Opportunity Act (AGOA), questions have been raised about what the decision could mean for the country's economy, farmers and workers.
The move, which is expected to take effect on 1 January 2027, means South African exporters could lose preferential access to the US market and face higher import duties. But what would this mean for local farmers, businesses and jobs?
An analysis published by Financial Mail found that some South African products currently attract a 12.5% tariff when entering the US market. Without AGOA, an additional 3.4% levy could be applied, pushing that figure to 15.9% and making local goods less competitive against producers from other countries.
How farmers could be affected
Despite the projected increase, historical data suggests the impact on agriculture may be less catastrophic than anticipated. In 2025, South African agricultural products already faced US tariffs of around 30%. Even so, exports to the United States reached $504 million (approximately R8.7 billion), reflecting only a 3% decline compared to the year before.
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The figures indicate that local farmers have demonstrated resilience under tariff pressure, and could remain viable even if AGOA access is withdrawn. However, the country has not yet been excluded from the programme, and efforts to retain membership are ongoing.
See X post on the potential consequences here:
Job losses could follow
The potential fallout extends well beyond the farm gate. Industries reliant on US-bound exports could struggle if South African products become costlier in that market. The gravest concern is that shrinking profit margins could eventually translate into job losses in a country already grappling with high unemployment rates.
South Africa exports several manufactured goods to the United States, including vehicles and wine, and it is yet to be seen whether alternative markets would generate sufficient demand to offset the loss of American trade.
The prospect of AGOA exclusion arrives at a particularly challenging moment. South Africa continues to grapple with persistently high unemployment and sluggish economic growth.
Ramaphosa warns SA about potential loss of AGOA agreement
Previously, Briefly News reported that President Cyril Ramaphosa publicly acknowledged that South Africa may lose access to the African Growth and Opportunity Act (AGOA), warning that the country must begin preparing for that outcome. Ramaphosa described the potential job losses as "devastating," underscoring the scale of the economic risk facing the country.
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Source: Briefly News
