Minister Parks Tau said South Africa’s automobile exports do not constitute a threat to the US industry.
The United States has announced its intention to impose a 25% tariff on imports of cars and certain car parts by 3 April 2025, and not later than 3 May 2025, respectively.
The Minister of Trade, Industry, and Competition, Parks Tau, said the tariff is to address what the US perceives as a threat to its national security under Section 232 of the US Trade Expansion Act of 1962.
“As per the Executive Order, the duties will apply to all countries, including those with free trade agreements with the United States, with the exception of countries party to the United States-Mexico-Canada Free Trade Agreement.”
Section 232 tariffs
In a media statement, Tau added that the previous Section 232 applied to foreign imports of steel and aluminium, nullifying the preferences that sub-Saharan African countries enjoyed under the Africa Growth and Opportunity Act (Agoa).
Therefore, the Section 232 tariffs on automobiles and automobile parts are expected to also apply to imports of these products from Agoa beneficiary countries, including South Africa.
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“Automobile exports from South Africa accounted for 64% of South Africa’s exports under Agoa in 2024 and are therefore a significant component of products currently benefiting from the preferential programme.”
He said South Africa’s automobile exports account for only 0.99% of US total automobile imports and 0.27% of auto parts, and thus do not constitute a threat to US industry.
US imports
“United States imports of automotive and automotive parts from South Africa were estimated at just over $2 billion; while US exports to South Africa were over $1.1 billion in 2024.
“While South Africa’s exports to the United States go duty-free under Agoa, US imports into South Africa also enjoy rebates under the Automotive Production Development Programme.
“Given the potential negative effect on the South African economy, South Africa will seek a meeting with the United States authorities to discuss these developments. The department will also engage the automotive industry to discuss its implications,” said Tau.
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