Trump's copper tariffs pile more metal misery on US car industry
The duties on their own may be manageable, but prices of the red metal vital for making cars, in particular in wire harnesses and motors for electric vehicles, have soared to record highs.
The US market is heavily reliant on imported copper, aluminium and steel, and developing new capacity could take years so users are scrambling to buy metal from a limited number of suppliers, spurring price rises.
Added to import tariffs on the metals, and higher prices in the US, the extra costs are compounding the financial strain on carmakers and parts suppliers, interviews with a dozen executives, industry analysts and experts show.
Carmakers have been relying on inventories to avoid raising prices, but could be forced to pass on mounting import tax costs to consumers.
Some, including Ford and Toyota, have announced hikes to mitigate other Trump-induced tariffs, while Porsche expects a €300m (R6,285,306,000) hit to results from tariffs for April and May alone.
"This (a copper tariff) complicates a difficult situation" for the car industry, said Daan de Jonge, lead analyst for copper demand and prices at Benchmark Mineral Intelligence.
Trump's announcement of the tariff ast week propelled prices on US platform Comex to a record $5,682 (R102,044) a pound (0,453kg) or $12,526 (R225,018) a metric ton, a premium of more than $2,920 (R52,459) a ton over the price on the London Metal Exchange, around $9,600 (R172,469) a ton, which the market uses as the global benchmark. The rate is effective from August 1.
The US Midwest duty-paid aluminium premium paid on top of the benchmark LME price for physical delivery has tripled to 60 US cents (R10,71) a pound since Trump was inaugurated.
In the same time, the LME price has slipped 3% to $2,604 (R46,783) a metric ton. US top carmakers GM , Ford and Jeep maker Stellantis declined to comment.
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The Star
2 hours ago
- The Star
South Africa Is No Longer Alone on the International Stage
Vashna Jagannath | Published 1 week ago South Africa's position on the human catastrophe in Gaza has been consistent, lawful and morally serious. It has insisted that international law must be applied equally to all countries, regardless of their power or alliances. This has included the referral of Israel to the International Court of Justice (ICJ) on charges of genocide. While Pretoria has won international respect in many quarters, the price has been steep. It has come under immense pressure from the United States, in particular the Trump-aligned right, as well as from domestic organisations and figures closely aligned with the West. In this context the formation of the Hague Group—a bloc of states committed to defending international law and ending impunity—marks a development of considerable significance. The group was convened by the Progressive International and launched on 31 January 2025. It is chaired by Colombia and South Africa, with current members also including Bolivia, Cuba, Honduras, Malaysia, Namibia, and Senegal. The coalition—spanning Latin America, Africa, Asia and the Caribbean—pledged to support ICJ and International Criminal Court (ICC) rulings, prevent arms transfers to Israel, bar military fuel shipments, and pursue legal accountability for violations in Gaza. Western governments have long invoked the language of a 'rules-based international order'—sometimes in strident moral terms—to justify their global domination. But this order has often served to shield the West and its allies from legal scrutiny while imposing strictures on others. The 2003 invasion of Iraq by the United States was a clear violation of international law. The NATO-led regime change intervention in Libya in 2011 was also unlawful. In Afghanistan, elements of the two-decade occupation—including targeted killings and drone strikes—breached international humanitarian law. Israel's bombing campaigns in Syria and Yemen, sometimes backed or tacitly accepted by the West, included strikes on civilian infrastructure and violations of territorial sovereignty and have been deemed unlawful by UN experts and legal assessments. In each case, a supposedly rules-based order yielded to the impunity of powerful Western states. Until now, the idea of international law as a universal normative system has been more aspiration than reality. The United States has not ratified the Rome Statute and has actively resisted ICC investigations, including imposing sanctions during the probe into alleged U.S. war crimes in Afghanistan. Israel remains outside the court's jurisdiction. The ICJ—though central to the UN system—continues to be undermined: the U.S. withdrew from its compulsory jurisdiction in 1986 after being found to have violated international law in Nicaragua. South Africa's decision to bring the genocide case against Israel before the ICJ was bold and principled. Though the Court's final ruling is pending, provisional measures have already instructed Israel to prevent genocidal acts and allow humanitarian aid. That legal action made South Africa a target. In the US the Biden administration expressed concern, but pressure escalated dramatically when Donald Trump returned to the Presidency. This is one reason among many why the Hague Group matters. By aligning with other states in defence of international law, South Africa has built a collective bloc. This bloc's cohesion offers protection as well as enhancing the aim of defending international law. Francesca Albanese, the UN Special Rapporteur on the Occupied Palestinian Territories, argues that the Hague Group provides 'a global push for collective action through international law—no arms for genocide, no aid for occupation, and no tolerance for apartheid.' In her view, the initiative not only exemplifies states meeting their legal obligations but also challenges the exceptionalism that shields powerful states from accountability. She has argued that the Group's efforts 'must become a global initiative' if the integrity of international law is to be affirmed. The next milestone for the Group is the Emergency Conference co-hosted by South Africa and Colombia and set for 15–16 July 2025 in Bogotá. This gathering will include many non-member states—though not all are expected to formally join the Group—and focus on enforcing ICJ rulings, halting ongoing violations, and affirming Palestinian self-determination. Delegates are expected to announce coordinated legal and diplomatic measures. South Africa's response to the crisis in Palestine has helped restore some of the international moral standing lost during the Zuma years. At home, it has given some citizens hope that an ethical core still exists within the ANC and government, and could extend to other pressing issues at home and abroad. Perhaps this is why the legal team were greeted at the airport with the kind of warmth and pride usually reserved for triumphant sports teams when they returned from the ICJ. It was a moment that revealed a deep public hunger for moral seriousness and national purpose. Tellingly, the approach to the ICJ won strong support from mass-based organisations such as the National Union of Metalworkers (NUMSA) and Abahlali baseMjondolo, which are usually intensely critical of the ANC. In the West there is a clear shift, especially among young people, from uncritical support for Israel. Nonetheless, governments in countries like Germany and the United Kingdom, along with the US of course, continue to back Israel's unlawful actions in Gaza, as well as Yemen, Syria, Lebanon and Iran. In this context where support for change still confronts powerful opposition the Hague Group is a significant collective challenge to the impunity of powerful Western states. The era in which Western exceptionalism defined the limits of legal accountability is being directly contested . Whether this results in meaningful enforcement or another retreat into hypocrisy will depend not only on the Hague Group's resolve, but on whether other states are prepared to act on the principles they claim to uphold. * Dr Jagarnath sits on the council of the Progressive International. ** The views expressed do not necessarily reflect the views of IOL or Independent Media.
Daily Maverick
3 hours ago
- Daily Maverick
Can SA forge a new consensus at G20 summit?
For the second time this year, the world's most powerful finance ministers have gathered in South Africa, this time at the lush resort of Zimbali north of Durban. But one minister will once again be conspicuous by his absence: that from the US. Scott Bessent, the mercurial US Treasury Secretary, has once again skipped the G20, choosing instead to send Michael Kaplan, the acting undersecretary for international affairs at the US Treasury. It all started when Secretary of State Marco Rubio refused to participate due to the host's vision of this year's G20 presidency being about 'Solidarity, Equality and Sustainability' — principles the current US administration theatrically rejects. In one sense, the timing of this South African presidency of the G20 could not be worse. Faced with the anti-globalist, protectionist bent of the US, what is usually a processional opportunity for showcasing a nation's soft power and producing vacuous missives about global cooperation has become a near impossible job of managing diplomatic fallout. As the first country from Africa to host the G20, South Africa had hoped to push issues vital for the very developing nations that stand to lose the most from the US president's trade war. With US aid budgets cut to virtual non-existence, and with tariffs about to decimate the export industries that, until now, had been the only hope for small African developing countries to build some semblance of a manufacturing sector, South Africa now finds itself managing the wreckage of international consensus. The G20 is a relatively new arrival to the international global system of forums and talk shops. Established as a response to the global financial crisis in 2008, the whole point was for countries like the US, the UK and the EU to include the faster growing nations of the Global South, which were becoming increasingly critical to the global economy. That promise now looks increasingly hollow. US vs the world: SA salvages G20 How naïve and quaint that looks, from the perspective of the realpolitik of 2025. In addition to Trump's threat of crippling levies on key trading partners from 1 August 2025, the US president has taken aim at the BRICS bloc of emerging economies — which includes host nation South Africa — threatening an extra 10% tariff for 'anti-American' policies. South African President Cyril Ramaphosa, following the BRICS summit in Rio last week, was the first of the group to hit back. 'The president of the US must recognise that multiple centres of power now define the global landscape,' he said. Ramaphosa is still trying to convince Trump to attend a G20 leaders' summit in Johannesburg in November, where he is due to hand over the presidency of the group to the US. But hopes that Trump will support any of South Africa's G20 initiatives have largely been extinguished. Under fire from corruption scandals at home, Ramaphosa's efforts are increasingly looking to be in vain. The G20 international outreach also follows a highly publicised Oval Office dressing-down, where Trump repeated false claims about a so-called genocide against white South African farmers. Still, despite Washington's aggressions, South Africa has no option but to press ahead with this week's meetings, which culminate on Thursday and Friday with sessions led by finance ministers and central bank governors. South African Reserve Bank governor Lesetja Kganyago and Finance Minister Enoch Godongwana will, at least, be in the limelight as opposed to the embattled president. The EU is now in the firing line It is not only developing countries that have been targeted by Trump. On Saturday, the EU received a typically condescending letter from Trump, threatening blanket tariffs on European goods. In a message that appeared to be copied and pasted from the one sent to South Africa and countless other recipients, Trump invited the EU to 'participate in the extraordinary Economy of the United States, the Number One Market in the World', while warning of sweeping new levies. His parting line, as ever: 'Thank you for your attention to this matter!' The proposed 30% tariff rate, together with existing sectoral duties and an expected levy on critical goods, would take the increase in the US effective tariff rate on the EU to a brutal 26%. According to estimates from Goldman Sachs, if implemented and sustained, it would lower euro area GDP by 1.2% by the end of 2026. The US is the largest trade partner of the EU, with the sum of exports from the EU totalling $815-billion in 2024. The EU understands that such a trade restriction with its biggest partner is nothing short of an existential challenge. In response, the bloc is actively seeking to diversify its trade ties. Besides Canada and Japan, the bloc is now fast-tracking agreements with India and other Asia-Pacific nations. Speaking from Beijing, EU competition chief Teresa Ribera confirmed that discussions with India are expected to conclude by year's end. 'We need to explore how far, how deep we can go in the Pacific area with other countries.' Africa will undoubtedly be next. Can South Africa lead a G19 without the US? Where the tariff war ends is anyone's guess. But with the US — the architect of the post-war global order — now acting as a destabilising force, the need for alternative alliances and renewed multilateralism between other parties has never been clearer. Already, the US absence has drawn others closer. After Rubio's withdrawal, the EU publicly endorsed South Africa's G20 agenda. Within weeks, the EU and South Africa held their first summit since 2018, marking a thaw in previously strained relations. Strangely then this year's G20 could prove to be its most consequential since its inception. Will it become the moment when the rest of the world reaffirms a commitment to open markets, trade and mutually beneficial cooperation? Or will it cement the beginning of the end for the rules-based global economy? In that sense therefore the timing of South Africa's G20 presidency could not be better. As a nation that once symbolised the post-Cold War liberal ideals of inclusion and equality, it is perhaps fitting that it should fall to us to rally the Global South and like-minded powers toward a new consensus. But the challenge is enormous. Can Ramaphosa — wounded politically and isolated diplomatically — rise to the occasion? Can South Africa lead a meaningful G19 in the absence of the US? To quote Tennyson's Ulysses, while 'death closes all, some work of noble note may yet be done'. The South African president may identify with the itinerant Greek after his own interminable political odyssey. Given his patchy track record in office, the answer may not be encouraging. And yet, history never asks whether leaders are ready. It simply presents the moment. Ramaphosa now faces his. DM
Daily Maverick
3 hours ago
- Daily Maverick
Road ahead is steep but not insurmountable– SA's G20 can still deliver for debt and development
The global economy has slowed and become less supportive of developing countries. African countries may be forced to resort to international capital markets to fill the gap in their development financing needs. It is crunch time for South Africa to begin delivering on its ambitious G20 development finance agenda. The third of the four meetings this year of G20 finance ministers and central bank governors takes place on 17 and 18 July. A communiqué is expected to be issued, focusing on the development finance issues that South Africa prioritised at the beginning of its G20 presidency. The agenda includes politically and economically complicated topics such as sovereign debt and the cost of capital and climate finance, which are issues that are high on the global policy agenda. At the recent African Union Conference on Debt held in Togo in May, African leaders, among other matters, called for the reform of the G20 common framework and for a 'new debt doctrine'. The Compromiso de Sevilla, the outcome document from the recently concluded UN-sponsored Fourth International Conference on Financing for Development (FfD4), also acknowledged the need for a more development-oriented debt architecture. Unfortunately, the international economic environment in which South Africa needs to deliver on this agenda has become significantly more complex and challenging. The global economy has slowed and become less supportive of developing countries. The World Bank recently reduced its estimate of global growth from about 2.8% to 2.3% and forecast that average global growth in the first seven years of the 2020s would be the slowest of any decade since the 1960s. Its chief economist declared that ' outside of Asia, the developing world is becoming a development-free zone '. Some G20 participating states have become less supportive of developing countries. For example, the US and the UK, among other countries, have significantly cut their official development assistance, with the US going as far as eliminating USAid, its main aid agency. US President Donald Trump's administration also pulled out of FfD4 and has given mixed signals on his participation in the G20 summit in November. He has even opposed the theme for South Africa's G20 presidency – Solidarity, Equality, Sustainability. These developments aggravate Africa's development challenges. Currently, Africa has an annual financing gap of around $900-billion to $1.3-trillion for Agenda 2063 and the SDGs. While domestic resources should be the major source of each country's financing for these needs, they are unlikely to be enough in the short to medium term. Unfortunately, the amount of funding from official sources such as donor governments and the multilateral development banks (MDBs) will not be sufficient to plug this hole. Therefore, African countries may be forced to resort to international capital markets to fill the gap in their development financing needs. The financing these markets offer is expensive, involves exchange rate risks and is pro-cyclical. In addition, evidence suggests that African countries are charged much higher interest rates than countries in other regions with comparable credit ratings. The resulting 'African premium' costs African countries $74.5-billion per year in excess interest payments, according to a UNDP report. The reasons for this premium are still up for debate. It has been attributed to credit rating bias, lack of quality data, a lack of sound fiscal and public finance management by African governments, and to the fact that many African countries are new to international markets, having only started issuing international bonds between 2007 and 2020. Meanwhile, as African countries continue to deal with these tough conditions on the international capital markets, efforts to address their existing debt burden remain painfully slow. The current approach to sovereign debt restructuring uses the common framework developed by the G20 to deal with the obligations to all official and commercial creditors of low-income countries. Unfortunately, this framework has failed to deliver adequate outcomes for African countries. South Africa's G20 presidency provides the next opportunity to address this challenge. As South Africa commences the last half of its G20 Presidency, we suggest that it prioritise the following issues on the development finance agenda: South Africa must champion the Borrowers' Forum This forum, promoted in the outcome document from FfD4, would facilitate the exchange of ideas, information and peer learning among sovereign borrowers. If supported by a permanent secretariat, as proposed in the Report of the UNSG's Expert Group on Debt, the forum could become the repository of information about sovereign borrowing and the source of technical support and capacity building for debtor countries. South Africa should advocate for the G20 to actively support the creation of the forum as soon as possible. It should also work with the African Union and African G20 guest countries to take the first actions to operationalise a regional borrowers forum in Africa. Improving sovereign debt architecture South Africa, as co-chair of the Global Sovereign Debt Roundtable (GSDR), must use it as a tool to promote the improvement of the sovereign debt architecture. The FfD4 Compromiso calls for the creation of a working group to propose a set of principles for responsible sovereign borrowing and lending that can make sovereign debt transactions and the international debt architecture more effective, efficient and more supportive of optimal development outcomes. The GSDR was established as an informal G20-linked forum, chaired by the G20 presidency, the IMF and the World Bank. It brings together a diverse array of creditors, debtors and other stakeholders to discuss how to make the sovereign debt process work better for all stakeholders. South Africa should convene a meeting of the GSDR to begin discussing the framework for promoting responsible sovereign borrowing and lending, including the planning and management of such transactions and their outcomes. Panel of technical experts South Africa must advocate for the G20 to appoint a panel of technical experts to study the barriers to affordable, adequate and predictable flows of development finance to African sovereigns and make recommendations on what the G20 can do to remedy this situation. This can complement the work of the African Experts Panel, which has a broader mandate of 'exploring and defining strategies that advance Africa's collective developmental interests'. South Africa's G20 presidency should not be the end of this year's advocacy for a new and more developmentally responsible debt architecture. These actions should also be promoted at the World Social Summit and the COP30 in Brazil. DM Daniel D Bradlow is a part-time G20 Senior Fellow at the South African Institute of International Affairs (SAIIA), where his research focuses on the finance track of the G20 and related Think20 issues.
