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South Africa’s bilateral trade position with the US has been steadily improving since the enactment of the African Growth and Opportunity Act (AGOA) which grants South Africa preferential access to US markets. As a result, the US is South Africa’s second largest trading partner (after China) in both total trade and exports. However, this strategic partnership now faces significant pressure under the new tariff regime[1].
In early April 2025, US President Donald Trump announced a 30% tariff on manufactured goods exported to the US and a 25% tariff for automotive parts. However, key minerals such as Platinum Group Metals (PGMs) coal, gold, manganese and chrome were not included in these tariffs. These primary materials contribute to the surplus trade deficit South Africa has with the US. The exclusion of PGMs also appears to be a calculated move by the US, aimed at safeguarding its manufacturing interests and protecting affiliated firms from the artificial costs associated with the tariff impositions[1][2].
In the wake of this tariff tsunami, South African supply chains are under pressure to shield local exporters from rising costs. South Africa’s growing automotive manufacturing sector—a pillar of South Africa’s export portfolio—faces dire ramifications in the US market that could jeopardise a significant revenue stream of an already strained South African economy[1][2][3].
As a short-term response, South African supply chains should pursue collaborative efforts with the South African government, industry associations and committees to develop programmes that facilitate entry into new markets, broaden supply chain networks and improve economic and supply chain resilience. Such collaborative ventures provide unique opportunities of economic growth and employment that can stimulate the growing manufacturing and export industry in South Africa[2].
South Africa’s possible trade pivot
As US tariffs present new challenges, opportunities are opening elsewhere. Countries in the European Union and Asia offer alternate market access opportunities to counter US tariffs. The existing Trade Development and Cooperation Agreement (TDCA) between South Africa and the EU facilitates the possibility of preferential trade agreements where free trade areas could be established. Additionally, Japan—despite logistical challenges and market competition—provides promising long term partnership opportunities for the South African export market as a stable demand for platinum, coal and minerals continues to grow[1]. By diversifying trade relationships, South Africa can build resilience and unlock new growth pathways
Building stronger supply chains with technology
Despite the geopolitical shake-up caused by the new U.S. tariffs, there’s a clear opportunity for South African supply chains to break away from traditional methods and embrace more innovative, forward-thinking strategies for growth. Furthermore, supply chains should leverage the current technological and information system landscapes to further bolster their resilience. Technology and information systems facilitate data-driven decision making, helping organisations achieve their goals across planning horizons. Today’s digital solutions make it easier for businesses to access integrated planning insights, test scenarios and adapt strategies—at a fraction of the cost.
Adopting digital technologies is a critical response to global uncertainty, enabling supply chains to remain, competitive and future ready. This enables organisations to build both flexible and durable supply chain networks capable of responding to sudden changes in geopolitical, environmental or situational events that might occur. Data driven demand planning provides another benefit of technology enabled supply chains. By using this, businesses can reduce supply chain costs whilst improving customer service levels.
Additionally, sustainability and ESG reporting capabilities have become an increasingly important consideration for EU and global organisations. As regulations on sustainability standards and punitive actions increase, organisations that meet reporting standards stand out. These businesses not only gain a competitive edge but also strengthen their position when negotiating better trade terms. Beyond compliance, ethical supply chain practices and transparent reporting help build long term trust. With rising trade war tensions, sanctions and sustainability regulations, visibility into sourcing and supplier trust becomes increasingly important. This shift provides organisations with a unique opportunity to stand out by adopting tools like blockchain to verify ethical sourcing and build reliable, future-ready supply chains.
New routes, new resilience: Turning global pressure into local strength
While the US tariff impositions present undeniable pressure to South Africa’s supply chains, this moment also presents opportunity. Geopolitical shifts are reshaping global trade but are also opening the door to new market opportunities. By embracing digitalisation, prioritising ethical trade practices and fostering collaboration between business and government, our supply chains will not only adapt but thrive in the face of global disruption.
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Contact us
Retief Ferreira
Director | Procurement Excellence Lead, PwC South Africa
Tel: + 27 (0) 11 287 0347
