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AI, climate change and geopolitical shifts are reconfiguring the global economy. In addition, the recent tariff increases imposed by the United States present a significant challenge—but also a powerful opportunity—for South Africa1. While these changes may impact trade, investment and employment, they also serve as a wake-up call to rethink, reskill and reinvent how we do business.
The challenge: Rising tariffs, rising stakes
On the 2nd of April the US administration announced a 10% global minimum tariff, along with reciprocal tariffs targeting individual countries. If fully implemented, this would raise the effective US tariff rate from 2.4% to 22% in 2025 —a level last seen in the 1930’s.2
The new US tariffs on South African exports—particularly in sectors such as precious metals, aluminum, vehicles, mineral fuels and agricultural products—are increasing costs for American buyers and threatening demand. These tariffs function as de facto taxes, reducing South Africa’s competitiveness in one of its key export markets. The message is clear: the stakes are high and the pressure is real.
The domino effect
How the US tariffs will threaten jobs and growth
If South Africa loses AGOA preferences, our exports could face steep US tariffs—eroding our competitive edge against more cost-efficient markets. Now more than ever, strategic diplomacy and trade resilience are critical.
The impact is not theoretical. South Africa’s top ten export chapters to the US are now under pressure, placing an estimated 13,200 jobs at risk3 . Industries like agriculture and automotive, which employ large numbers of young workers, are especially vulnerable.
Aluminum, a case in point: The imposition of tariff increases on aluminum and related articles is projected to result in significant market loss. This would likely lead to a decline in demand and put several jobs at risk in this capital-intensive industry.
This underscores the broader economic threat these tariffs pose—not only to exporters, but also to the national economy, threatening: Jobs. Business confidence. And overall fiscal stability.
The ripple effect
From boardrooms to households
Tariffs don’t just affect trade. They affect people. As businesses face rising costs, they may be forced to: Reduce hiring, cut jobs and or delay investment. And when that happens, it can lead to:
- Reduced household income
- Increased unemployment
- Strained public services due to lower tax revenues
According to PwC’s Global Workforce Hopes and Fears Survey 2024, employees are already feeling the strain. Many may face heavier workloads as companies adjust to the new world of work. Combined with anxieties around automation, restructuring and job security, this can significantly affect mental and physical well-being—ultimately reducing productivity and engagement. PwC’s Hopes and Fears survey4 also reveals that the majority of employees are excited about optimisation and transformation coupled with the use of new technology and tools. Organisations should use this as leverage to look at reinvention to lessen the potential impact of tariff hikes.
Technology as a double-edged sword
Many organisations are already accelerating technological advancements. However, rising tariff costs may force organisations to double down on investments in automation to drive efficiency, cut costs and relieve operational strain. While this shift can lead to job displacement, it also opens doors to new roles in the tech sector—provided workers are equipped with the right skills.
However, the transition is not without challenges. Many workers may lack access to training or the foundational skills needed to pivot into new roles. This makes inclusive, accessible workforce development strategies essential for long-term success. At the same time, leveraging technology to supercharge your reinvention is non-negotiable for businesses today.
The opportunity: Build resilience, empower people
To truly future-proof operations and remain competitive, organisations must pair digital transformation with bold people-centered strategies. Now is the time for strategic, future-focused leadership. South African businesses can:
- Diversify supply chains to reduce dependency on high-tariff markets
- Invest in workforce development to equip employees with future-ready skills
- Accelerate digital transformation to boost productivity and reduce costs
- Create new roles in trade strategy, legal advisory, and economic policy
These actions not only mitigate risk—they unlock new value.
Own the future: Lead with purpose, act with urgency
Tariff increases are just one striking example of how global connectedness and geopolitics can rapidly disrupt industries and business models—often with little warning. These shifts underscore the urgent need for adaptable, forward-thinking leadership that can navigate uncertainty while keeping people at the centre of strategy.
Leaders of tomorrow must be able to:
- Make sense of the world and translate it into actionable strategies
- Identify the hidden opportunity camouflaged by the challenge
- Fuel the engines to deliver on pivotal changes
- Develop a resilient workforce with an agile mindset
As highlighted in PwC’s Six Paradoxes of Leadership, we need more “global localists”—leaders who think globally, act locally, and bridge context with clarity.
The bottom line: Shape the future, don’t just survive it
Granted, the tariff discussion is layered with complexity and disruption—marked by uncertain negotiations, fluctuating rates and an ever-expanding list of affected goods. South African businesses are under pressure but, that pressure can be the spark that fuels transformation. By accelerating digital transformation, building trust and unlocking value through workforce, businesses can not only navigate disruption but lead with purpose and resilience. Now is the time to act: To Rethink your strategy. Reskill your teams. And Reinvent your future.
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