Brendan Smialowski / AFP
The Presidency said it noted with concern the newly imposed tariffs on South African exports to the United States of America announced by the US president Donald Trump.
He imposed a 30% reciprocal tariff on South African goods as part of a raft of tariffs imposed on countries around the world, including allies like the UK and Australia.
President Cyril Ramaphosa said that whilst South Africa remains committed to a mutually beneficial trade relationship with the United States, unilaterally imposed and punitive tariffs are a concern and serve as a barrier to trade and shared prosperity.
“The tariffs affirm the urgency to negotiate a new bilateral and mutually beneficial trade agreement with the US, as an essential step to secure long-term trade certainty,” he said.
Professor Raymond Parsons of North West University said higher tariffs of 30% on exports to the US are also a serious headwind for South Africa.
He said the country needs a calm and pragmatic approach based on evidence-based homework.
“The automotive sector will take a particularly hard hit. In seeking to manage higher US trade tariffs, SA must mobilise the necessary economic diplomacy to try to offset the economic damage and stabilise the situation.
“Given President Trump’s reciprocal approach to tariffs, SA must see what trade adjustments might be made to win concessions to ameliorate the situation.
“SA must also prudently seize the moment to begin to identify alternative markets as the US withdraws behind protectionist barriers.
“The isolationist direction of US trade policy is now abundantly clear and is the ‘new normal,” Professor Parson said.
Meanwhile, across the globe equity markets tumbled following Trump’s announcement.
AFP reports that Tokyo's Nikkei briefly fell more than four percent, while US futures plunged with oil prices, safe haven gold hit a record high, and the dollar retreated amid worries retaliatory measures will batter economies.
The panic came after the US president unveiled a blitz of harsher-than-expected levies aimed at countries he said had been "ripping off" the United States for years.
Against a backdrop of US flags, Trump said that "for decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike".
The measures included a 34 percent tariff on rival China, 20 percent on key ally the European Union and 24 percent on Japan.
A number of others will face specifically tailored tariff levels, and for the rest, Trump said he would impose a "baseline" tariff of 10 percent. Auto tariffs of 25 percent meanwhile kicked in Thursday.
Investors are bracing for retaliatory measures, with governments making their anger clear.
China vowed "countermeasures" and urged Washington to cancel the tariffs, while calling for dialogue.
Japan said the move was "extremely regrettable" and could contravene World Trade Organization rules, while Taiwan described the levies as "highly unreasonable".
European Union chief Ursula von der Leyen called Trump's announcement a "major blow to the world economy" but vowed the bloc was "prepared to respond".
And France said Brussels was "ready for a trade war" and plans to target online services in response.
Thailand said it had a "strong plan" to handle the new US measures and hopes to negotiate a reduction, while Canadian Prime Minister Mark Carney warned "we are going to fight these tariffs with counter measures".
(Additional reporting AFP)
