South Africa Braces for 100K Job Cuts as Trump’s Tariffs Hit Key Industries

South Africa is facing 100,000 job losses if US President Donald Trump goes through with his tariff plan, scheduled to kick in from August 1, 2025. The tariff plan will impose a 40 percent duty on exports to the US.

The country’s most lucrative export sectors, agriculture and car production, will be the hardest hit. Both have previously been beneficiaries of the African Growth And Opportunity Act (AGOA), which has provided duty-free export to many African countries so far.

South Africa’s Central Bank Governor Lesetja Kganyago recently told a local radio station: “The impact on agriculture could actually be quite devastating because agriculture employs a lot of low-skilled workers, and here the impact is on citrus fruit, table grapes and wines.”

In 2024, car and car parts exports accounted for 10.7 percent of South Africa’s exports to the US, while agricultural products made up 4 percent of total exports. As a whole, South Africa’s car exports accounted for 64 percent of all AGOA exports to the US in 2024.

South Africa isn’t the only southern African country facing economic loss following the planned tariff arrangements; Lesotho, which supplies the US apparel market with garments, is also set to lose 20,000 jobs if the US implements a scheduled 40 percent tariff on its export items. 80 percent of its clothing exports go the US, with the remaining 20 percent supplying the rest of the South African Development Community (SADC) region.

As it stands, export orders in the sector are already drying up in anticipation of the planned tariff, and job losses have began.

South Africa, which has so far seen a 25 percent tariff imposed on its car exports, and 30 percent on automotive parts, may have to reconsider its Black Economic Empowerment (BEE) rules to allow Elon Musk to set up Starlink in the country without having to cede a share of the business to historically disadvantaged South African communities.

Musk, who is considered very influential in President Trump’s administration, may well be the one to spur the relaxation of these tariffs if South Africa allows him to set up business outside of BEE.

Featured image Courtesy Dan Klimke | Dreamstime.com