Can SA afford Agoa’s loss as US ends eligibility?

About $1.7 billion in South African exports benefited from Agoa preferences in 2025, representing roughly 1% of global exports. The US government’s announcement that it intends to end South Africa’s eligibility under the African Growth and Opportunity Act (Agoa) from January has turned diplomatic tension into a commercial deadline. Pretoria has defended its concessions, questioned additional American concerns and emphasised alternative markets. Although both governments have reasons for their positions, neither has established a clear path from further negotiations to restored trade certainty. About $1.7 billion (about R27.8 billion) in South African exports benefited from Agoa preferences in 2025, representing roughly 1% of the country’s global exports. Withdrawal would not close the American market and although the national economy may withstand the adjustment, particular exporters and workers could face substantial losses. Agoa is not a conventional trade agreement in which two governments exchange tariff concessions to secure a defined outcome. It is a preference programme with eligibility requirements extending beyond commercial market access, allowing the US government to consider governance, trade barriers, national security and foreign policy interests. Its eligibility reviews give American authorities considerable discretion over whether a country continues to receive benefits. That structure matters because the US government’s objections to South Africa require different responses. Agricultural restrictions can be assessed against animal health evidence and market access rules, while corruption requires institutional reforms and credible enforcement. Foreign policy disagreements involve diplomatic choices that may not be amenable to commercial compromise. Addressing one concern, therefore, does not necessarily resolve another. South Africa has legitimate reasons to regulate agricultural imports, pursue industrial development and maintain an independent foreign policy. However, legitimate objectives do not make every existing restriction defensible. Some measures may protect public health or productive capacity, while others could impose costs without demonstrable benefits. Reform should be assessed on its domestic merits rather than accepted or rejected simply because Washington demands it. Corruption is similarly not a matter of sovereignty alone, since weak procurement controls and inconsistent enforcement damage SAn institutions, regardless of US preferences. Stronger accountability would serve domestic interests, even if it did nothing to restore Agoa eligibility. The SAn government maintains that it has offered concessions beyond its earlier commitments and that the American administration has raised additional concerns during negotiations that began last year. The SA government must weigh the domestic costs of further concessions without knowing whether they would materially alter Washington’s decision. American authorities, meanwhile, must assess eligibility against requirements that cannot necessarily be satisfied through trade negotiations alone. For businesses, the consequences begin before withdrawal takes effect. An exporter considering a supply contract with a US customer must calculate future tariffs and the profitability of additional production, while an investor contemplating expansion must assess demand over several years. A known tariff increase can be incorporated into commercial calculations, although it may still make production uncompetitive. An uncertain tariff regime creates a different problem: businesses must prepare for several possible outcomes without knowing which will materialise. Some may delay expansion, shorten contracts or reconsider their exposure to American customers. These responses can begin before preferences are withdrawn. The government’s diversification efforts are important but cannot immediately replace predictable access to an established market. New opportunities do not automatically translate into customers, commercial relationships or comparable profit margins and businesses differ in their capacity to adjust. The US government also faces a question about effectiveness: its legal authority to withdraw preferences does not establish that doing so will change the conduct it opposes. For South Africa, the corresponding responsibility is to distinguish policies worth defending from those warranting reform, while explaining how affected businesses and workers will be supported. This does not require abandoning legitimate principles for market access, but it does require recognising that the economic consequences of defending those principles are borne unevenly. The unresolved problem is, therefore, not simply whether SA can survive without Agoa, but whether negotiations covering fundamentally different disputes can deliver the predictability on which trade depends.