South Africa may strike a trade deal with the United States of America within a month. Sources who spoke to The Common Sense said that negotiators on both sides had made some progress towards a deal that might see a dialling back of the tariff levels applied by the United States to South Africa whilst South Africa moves to address certain US investment and foreign policy concerns.

South Africa currently faces some of the highest tariff levels applied by the United States to any of its global trade partners amidst heightened diplomatic tensions between the two countries. Recent years have seen actors ranging from the US Embassy in Pretoria, to the US Congress, and the White House level charges at South Africa of acting in a manner that threatens US national security interests and of prejudicing US investors in South Africa. The enforcement of certain empowerment policy provisions which are read in Washington as non-tariff barriers as well as concerns about property rights protections have been particular areas of contention.

South African political leaders and government officials have in turn levelled barbed comments at the US that they will not tolerate interference in South Africa's domestic affairs.

South Africa retains vast geo-strategic importance in the estimation of the world's most powerful nations. The Simonstown naval base is read as one of three choke-points that command control of the Indo-Pacific as well as serving as a backdoor into the Atlantic. America is also falling behind its global rivals in investing into Africa and South Africa with its strong institutions and financial system is seen as an eminently investable destination.

Despite the at times barbed comments leaders of South Africa's unity government, and key leaders in the ANC, appreciate the importance of coming to terms with the Americans. Almost fifteen years of sluggish economic growth and job creation, underpinned by very low levels of fixed investment, cost the ANC its political majority in 2024 and now threaten the long-term stability of its unity government.

A few days ago, South Africa announced that it would postpone naval exercises with Russia and China that were set to coincide with a G20 meeting in South Africa later this year. The US subsequently announced that Vice President Vance would attend that meeting. The Common Sense was also informed that the US government does not want to punish South Africa for the actions of certain South African leaders and would instead look at targeted sanctions to be levelled against those individuals if that was felt to be justified.

A few days prior to suspending the naval exercises Pretoria had reprimanded a senior defence official for anti-American remarks made in Tehran.

In addition, the equity equivalent provisions that the American government wishes to be on offer to its firms invested in South Africa as an alternative to narrow empowerment compliance laws are already on offer to certain multinationals invested in South Africa whilst moves afoot to have aspects of South Africa's expropriation laws challenged in the country's courts will likely be welcomed in Washington.

The fraught nature of recent US/South Africa diplomatic interactions, and the presence of hardline actors in both camps, may however still scupper the talks and introduce new delays.

Any deal that materializes in the short-term may in addition be too modest to shift the dial much on South Africa's fixed investment number and hence its growth outlook. A short-term deal would, however, provide a fresh opportunity to reset diplomatic relations, lift investor sentiment to a degree, and will be read as a political victory for Mr Ramaphosa and South Africa's unity government.