Trump tariffs can cost South Africa 100,000 jobs

Accounting firm EY has warned that South Africa could see job losses of around 100,000 due to United States tariffs placed on the country’s exports.

These job losses will primarily affect the agriculture and automotive industries, although EY said there are some opportunities for resilience through strategic realignments and exemptions for critical minerals.

On 8 August 2025, the United States implemented a 30% tariff on South African goods exported to the US.

This came after months of waxing and waning threats surrounding potential tariffs on South Africa and extensive negotiations between the two countries.

However, ultimately, US President Donald Trump slapped a 30% tariff on South Africa, which is set to have a significant impact on the country’s economy.

The government has already been preparing for this impact, with plans to accelerate export diversification and bolster vulnerable sectors set to mitigate some of the damage.

South Africa will look to increase its exports to countries other than the United States, especially by expanding intercontinental trade with other African countries.

In addition, the government has announced plans to set up a support desk to advise companies affected by the tariffs and indicated that they will be financially assisted.

While these plans could mitigate some of the expected economic fallout due to the tariffs, South Africa is still set to take a significant hit. 

EY’s latest macroeconomic analysis forecasts potential job losses of around 100,0000, primarily in the agriculture and automotive industries.

The Centre for Risk Analysis has also warned that trade diversification does not happen overnight and will not offset near-term United States market losses, calling the South African government’s response “lacklustre”.

Economists have estimated that the US tariffs will result in South Africa’s economic growth taking a 0.3% hit. While this may not sound significant, the country’s economy is only projected to grow by around 1% in 2025.

Silver linings

While EY expects the US tariffs on South African exports to have a significant impact on the country’s economy, it said there are some opportunities to be found.

“While the tariffs could strain key exports like citrus, wine, soybeans, sugar cane, and beef, exemptions for PGMs will provide a buffer, enabling South Africa to pivot toward high-value mineral trade and emerging markets,” EY chief Africa economist Angelika Goliger said.

She added that the government’s plans to mitigate the impact of the tariffs will be crucial in this regard.

“Looking ahead, the government’s proactive Export Support Desk will be crucial in guiding businesses toward diversification, potentially unlocking new opportunities in Asia and the EU to offset US market losses,” she said.

“A comprehensive support package for affected businesses and workers is in the final stages, drawing on tools like the Unemployment Insurance Fund and temporary relaxations in competition law to foster exporter collaboration. 

Goliger said these measures will not only cushion immediate impacts but also position South Africa for stronger, more resilient trade networks in a post-tariff world. 

“By accelerating diversification, we could see a rebound in export volumes within 12 to 18 months, particularly if global commodity demand stabilises amid US-China tensions,” she said.

EY’s analysis projects that while short-term disruptions may weigh on economic growth, strategic shifts could enhance long-term competitiveness. 

This is particularly true for platinum group metals (PGMs), which are exempt from the US tariffs and are one of South Africa’s most important exports.

Goliger explained that, with PGMs exempted, the mining sector could benefit from sustained investor interest in critical minerals essential for green technologies. 

However, she warned that agriculture and automotive firms will need agile adaptations, such as supply chain rerouting and innovation in sustainable practices, to thrive.

“The tariffs represent a call to action for deeper integration into African Continental Free Trade Area opportunities and bilateral deals,” Goliger said. 

“Forward-thinking policies will help transform this challenge into a catalyst for shifting South Africa’s economic development trajectory.”