After a brief period of optimism, the outlook for a tariff agreement between South Africa and the United States (US) has dimmed. In July, following months of frustration with Pretoria, Washington announced across the board 30% tariffs on South African exports.

The Presidency responded that South Africa would press for a balanced, mutually beneficial relationship and noted the US assurance that the 30 percent rate could be modified after negotiations. In August, the foreign ministry echoed that line, saying the new US duties were unilateral and unfortunate, and suggested that domestic actors had undermined government efforts to reset ties with Washington.

By September, there were positive signs. Reporting suggested the two countries were edging toward a limited trade deal that could ease the new tariffs, though such a deal was never going to lift South Africa’s anaemic growth on its own. Shifting the macro growth trajectory would require a far larger investment pact that went beyond tariff relief.

Three practical issues

From the outset, American officials framed three practical issues as the threshold for tariff relief. First, empowerment rules were viewed as a non-tariff barrier that disadvantaged US investors. Second, expropriation legislation raised risks for firms that deploy capital and intellectual property in South Africa. Third, Pretoria’s foreign policy choices were seen as clashing with US security interests. Advice from Washington was that modest steps toward addressing these concerns, even strong signals of intent, might be enough to secure tariff relief, given that the 30% duties damaged both South African and American companies. US interlocutors repeatedly stressed that the aim was not to harm South Africa or blameless firms but to find a way to keep trade open while building a more reliable partnership.

Beneath that lay a strategic American worry. A country stuck near one percent growth with unemployment around 30% makes a brittle partner over time. The US saw a durable fix in an investment compact that could lift South African growth, not just a narrow tariff transaction.

Yet across the full period of this saga, and continuing into the present, South Africa’s official engagement was punctuated by lethargy, foot-dragging and barbs. This was most evident on the idea of a broader investment pact, where the South Africans were variously uninterested or wary that such a deal would dilute state control over infrastructure and resources. Meetings were skipped or snubbed, barbed remarks were made, and Pretoria’s public diplomacy continued to cut against US positions.

Vacuum

Into that vacuum stepped a range of private South African actors, from opposition figures and civil society groups to business leaders. They calmed US anxieties that a practical deal could be concluded and pressed their own side on the merits of an investment pact. In some cases, these private actors drafted frameworks for such a pact to show what might be done.

Disgracefully, in the view of this newspaper, those same efforts were then miscast in domestic South African media as sabotage, even though they had often kept both the tariff relief and investment pact options alive when the official track faltered. One participant likened the allegation of sabotage to accusing entrepreneurs who plan to build factories and hire staff in South Africa of undermining the country.

As the weeks passed, a view hardened in parts of Washington that Pretoria was more interested in the theatre of pursuing a deal than in actually closing one, and that it was manufacturing excuses and planting these in the South African media to explain away its intransigence. Countries with far broader and more complex ties to the US had long since concluded their negotiations, whereas South Africa’s relatively contained dossier remained unresolved.

Even so, there is still strong support in Washington for both a tariff deal and a vast new investment pact. The immediate difficulty in securing either is that any package agreed by negotiators will land on President Trump’s desk. He will ask what progress South Africa has made on empowerment rules as a barrier to investment, on expropriation risks for capital and intellectual property, and on a foreign policy stance that collides with US security interests. Washington advocates of the tariff and investment deals fear that it will be hard to supply an encouraging answer.