Western Cape Exporters Lose R2.8 Billion Amid US Tariff Pressure
South African exporters are facing a multibillion-rand blow from deteriorating trade relations with the United States after businesses in the Western Cape lost R2.8 billion in exports in 2025. The contractions forced several regional operators to shut down export sections and left thousands of jobs at risk.
Additional Tariffs Strain Manufacturing Supply Chains
Additional tariffs imposed by US President Donald Trump significantly reduced trade between the Western Cape and what was previously its biggest and most profitable trading partner. Terry Gale, chairman of Exporters Western Cape, stated that the manufacturing sector bore the brunt of the pressure due to its heavy reliance on American customers.
“Some of them have already closed down,” Gale said. “I know of factories in Atlantis that were employing up to 700 to 1,000 people. They’ve actually had to close their export section down because of these additional tariffs.”
While Gale could not provide an exact rand value for the total losses, he confirmed that affected jobs already numbered in the thousands. That figure threatens to climb higher if current trade tensions persist.
Historical Shipping Advantages Face New Hurdles
The Western Cape has historically benefited from a strong trading relationship with the US, supported by demand for South African products and a direct shipping service operating weekly from Cape Town with a transit time of around 21 days. Exporters valued the speed and reliability of this established route.
However, Gale noted that finding alternative markets takes years and cannot happen overnight. High baseline shipping costs from the Western Cape to the US compounded the pressure created by the new tariff regime, squeezing profit margins across furniture, automotive, and specialized manufactured goods.
AGOA Preferences and Future Market Uncertainty
The African Growth and Opportunity Act (AGOA) provides eligible sub-Saharan African countries with preferential access to the US market, including duty-free treatment for qualifying products, allowing factories to build supply chains specifically tailored for American buyers. Trump’s threats to remove South Africa from AGOA have added a new layer of anxiety for regional producers.
Although American buyers continue to show interest in South African goods—with furniture and other manufactured products close to securing new contracts—continued tariff uncertainty threatens to dismantle those deals before they translate into jobs.
“We cannot afford, as you are well aware, to lose any jobs, and we have to get as much trade going as possible,” Gale said.
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