South Africa on thin ice

Discovery’s top executive has sounded the alarm that South Africa risks losing its preferential access to US markets, saying there will be major repercussions for the economy if it does.

Pretoria’s relations with Washington had deteriorated since February when President Donald Trump froze most aid after claiming that land was being expropriated from White Afrikaner farmers.

The South African authorities haven’t confiscated any private land since apartheid ended in 1994.

Trump has also taken President Cyril Ramaphosa’s administration to task over its relations with Iran and its proxy Hamas, and for filing a case in the International Court of Justice in which it alleges that Israel’s actions in the Gaza Strip were an act of genocide.

His criticism has stoked fears over the fate of trade arrangements such as the African Growth and Opportunity Act, through which thousands of South African goods enter the US duty-free.

If AGOA goes — “and that looks very, very possible — that has a detrimental effect on jobs, on growth,” Discovery CEO Adrian Gore told Bloomberg TV’s Jennifer Zabasajja.

Being in the cross-hairs with the Trump administration is “very concerning,” said Gore, who serves as chairman of lobby group Business Unity South Africa in addition to running the company that owns the country’s biggest health insurance provider. 

While AGOA expires in September, US senators introduced a bill last year to extend the trade program, which includes more than 30 sub-Saharan African nations, until 2041.

To qualify, countries mustn’t engage in activities purported to undermine US national security or foreign-policy interests, grossly violate internationally recognized human rights, or support acts of terror. 

South Africa is preparing to pitch a bilateral trade agreement to the US should it lose access to American markets, people familiar with the matter said last month.

Ramaphosa has also announced plans to send delegations worldwide to explain Pretoria’s position on i its land-expropriation law and other issues. 

South Africa’s economy expanded 0.6% in 2024, the slowest pace in four years, hindered by logistical constraints, weak consumer spending, a drought and poor fixed investment.

“Ironically, I think that is precisely the time not to be distracted,” Gore said in the interview. “We have to actually focus hard on delivering key growth, key opportunities, or levers for growth.”

Gore wants the government to redouble its efforts to institute reforms, including addressing infrastructure bottlenecks, to unlock the potential for growth of as much as 3%. 

While South Africa is unable to shield itself from Trump’s escalation of global trade wars and will likely be “directly affected,” the business community needs to focus on “doing the right thing,” he said. 

This includes “being transactional, offering value to trading partners, doing whatever we can that’s good for growth, good for relationships, and do as much as we can,” Gore said.

“We certainly can’t insulate ourselves from them, but there are a lot of things we can do, and the private sector and business community is remarkably resilient.”