‘Still room for engagement' says Parks Tau as Trump's tariff deadline looms

Daily Maverick

a day ago

South Africa has been pushing to negotiate a trade deal with the US in order to prevent US President Donald Trump's sweeping tariffs.
Minister for Trade, Industry and Competition Parks Tau says the US has signalled that there's 'still room for engagement' on South Africa's request for an extension of the 90-day pause on new US tariffs.
This comes as US President Donald Trump said on Friday morning, 4 July, that the White House will begin notifying countries about new tariffs being imposed on them. Some tariffs, Trump said, could be even steeper than originally announced, according to a report from The New York Times.
Trump imposed a 30% tariff on SA in April, as part of his global 'reciprocal' tariffs, before agreeing to suspend their application for 90 days, saying he would hammer out bilateral deals with trade partners.
The 90-day pause on Trump's tariff hikes will end on 9 July.
SA, and other countries around the globe, have been pushing to negotiate trade deals with the US in order to prevent Trump's sweeping tariffs.
The Department of Trade, Industry and Competition (DTIC) said this week that SA has requested an extension of the 90-day pause, to enable it to revise its proposed deal in accordance with the Trump administration's new template for US trade with sub-Saharan Africa.
'In this regard, we are of the view that South Africa may need to resubmit its Framework Deal in accordance with the new template. It is thus expected that the deadline may be shifted,' said Tau in a statement on Tuesday, 1 July.
'We urge the South African industry to exercise strategic patience and not take decisions in haste and that government will continue to use every avenue to engage the US government to find [an] amicable solution to safeguard South African interests in the US market,' he added.
The US's plan to introduce a new trade template with countries in sub-Saharan Africa emerged in engagements between Deputy Minister of Trade and Industry, Zuko Godlimpi, and the Assistant US Trade Representative for Africa, Connie Hamilton, on the sidelines of the US-Africa Summit in Luanda, Angola, in June.
'Very good' engagement
According to Tau, Godlimpi had a 'very good' engagement with Hamilton, where there was an 'indication that there is still room for engagement'.
He told Daily Maverick on Friday that he believed discussions with the US will continue beyond 9 July.
'We submitted a draft Framework Agreement and they [the US] have not responded. They indicated that they are not in a position to finalise that right now, so it is their intention that discussions would go on beyond the 9th. So at this point we are awaiting an announcement from them,' Tau said.
SA initially submitted a proposed Framework Deal to the US on 20 May, a day before President Cyril Ramaphosa and Trump met at the White House in Washington, DC. The initial proposal included deals on agriculture, critical minerals, automotives and other exports.
'The Framework Deal addresses US concerns relating to, among others, non-tariff barriers, trade deficit, and commercial relations through two-way procurement or import of strategic goods. It aims to also resolve long-standing market access issues of interest to both sides and to promote bilateral investments in a mutually beneficial manner,' read the DTIC statement this week.
SA is also seeking to have some of its key exports exempt from the Sections 232 duties, including autos, auto parts, steel and aluminum. It is also seeking a maximum tariff application of 10% 'as a worst case scenario', according to the DTIC.
'The Framework also seeks exemption for Small and Medium Enterprises, counter-seasonal products and products that the US does not have productive capacity for,' it said.
What's at stake?
The US is South Africa's second-largest trading partner after China.
More than 600 American firms are operating in SA. In 2024, trade between SA and the US totalled $20.5-billion, with South African exports consisting largely of precious metals, cars and auto parts, iron and steel, and aluminium products, Daily Maverick reported.
SA has benefited immensely from the African Growth and Opportunity Act (Agoa) which has enabled it to export a range of products and goods to the US market duty-free. But Trump's new tariff regime would upend the country's long-standing arrangement under Agoa.
Professor Bob Wekesa, director of Wits University's African Centre for the Study of the United States, said he believed SA has tried its best to reach a bilateral agreement with the US.
'I don't think we should dismiss the efforts of the Government of National Unity… I think they've done their best,' he said.
'The tricky part is that Trump has refined the art of raising the bar; raising so many issues that you come kneeling before him, you come to the negotiations on the back foot.'
He said that while countries such as the UK and Vietnam have both reached trade agreements with the US in recent weeks, South Africa was bound to struggle because 'it's being targeted on other fronts, which are political [and] diplomatic'.
Nevertheless, Wekesa said it would be 'disastrous' for SA if Trump's tariffs were to come into effect again.
'It would mean that South African goods and services are impacted – almost a cessation of trade – particularly in critical areas like agricultural products, and specifically the citrus market, in areas of manufacturing, particularly in motor vehicles, and of course, related fields,' he said.
He added that it would be a 'big hit' for SA's economy. This will have an 'immediate impact' on the budgets and resources that the government can use for service delivery, according to Wekesa.
'This will of course be on top of the cessation of funding that was coming through USAID [United States Agency for International Development],' he said.
Wekesa noted that South Africa is 'not the only country' that has certain critical minerals, like platinum and hydroxide.
Next week, Trump will host leaders from five African nations in Washington to discuss 'commercial opportunities', according to a Reuters report.
'These countries also have critical minerals. So the idea that [the] US will lose out on the export of those minerals [from SA], I don't think, is a very strong one… The leaders of Senegal, Guinea-Bissau, Gabon, Mauritania, and Liberia are heading to the US. When you look at all the critical minerals from those countries they include all these minerals… One wonders if the US is actually divesting away from South Africa, or reliance on South Africa, by going to these countries to see if it can strike a deal.
'In many of these countries they don't have proper critical minerals policies or strategies – they are essentially weak countries, so the US can strike deals quite fast there,' he said. DM