South Africa must adapt quickly in a turbulent trade environment
 
Dear Fellow South African, 
 
The decision by the United States to impose a 30% tariff on South African imports highlights the urgency with which we have to adapt to increasingly turbulent headwinds in international trade.
 
The US is South Africa’s second largest trading partner by country and these measures will have a considerable impact on industries that rely heavily on exports to that country and on the workers they employ, as well as on our fiscus.
 
Domestic sectors such as agriculture, automotive and textiles have historically benefited from duty-free access to the US market under the African Growth and Opportunity Act (AGOA).
 
Our trade relations have historically been complementary in nature. South African exports do not compete with US producers and do not pose a threat to US industry. It remains our aspiration that this should continue. Largely, our exports are inputs into US industries and therefore support the United States’ industrial base. South Africa is also the biggest investor from the African Continent into the US, with 22 of our companies investing in a number of sectors including, mining, chemicals, pharmaceuticals and the food chain. 
 
South African imports ultimately benefit US consumers in terms of both choice and cost. By way of example, citrus production is counter-seasonal and does not pose a threat to US production. Furthermore, production by US companies has been on the decline for a number of years as the US sector grapples with low yields, a citrus greening disease and other factors unrelated to competition from imports. Imports from South Africa, the world’s second largest citrus exporter, have filled a gap and contributed to stable supply and prices for US consumers. 
 
As government, we have been engaging the United States to enhance mutually beneficial trade and investment relations. All channels of communication remain open to engage with the US. 
 
Our foremost priority is protecting our export industries. We will continue to engage the US in an attempt to preserve market access for our products. We must also accelerate the diversification of our export markets, particularly by deepening intra-African trade.
 
With a view to helping our producers and exporters aggressively explore alternative markets, we have established an Export Support Desk to assist affected producers. We will in due course be announcing the modalities of a support package for companies, producers and workers that have been rendered vulnerable by the US tariffs. This intervention will also play a key role in guiding industries looking to expand into new markets in the rest of Africa, Asia, the Middle East and markets we already have trade agreements with. 
 
Strengthening regional value chains will be key to building resilience for our export markets in the longer term. Much as strengthening and establishing alternative value chains will take time, this moment presents us with an opportunity to push forward with the implementation and expansion of the African Continental Free Trade Area (AfCFTA). Reducing over-dependence on certain markets is a strategic imperative to build the resilience of our economy. It will also enable us to expand the frontiers of opportunity for South African businesses, goods and services.
 
In the coming months we will be scaling up our trade missions into new markets in Africa and beyond, as well as the National Exporter Development Programme whose aim is to grow the pool of export-ready companies. 
 
It is important to understand that South Africa is not alone in facing high tariffs from the US. A number of export-reliant developed and developing economies, including several on the continent, are also grappling with these measures. 
 
The international trading system is changing. Complacency will not serve us, and building resilience is imperative. As government we remain committed to ongoing engagement with the US and building trade resilience.
 
With best regards,

Sun City, 26 June 2025

Honourable Premier of the North West Province, Mr Lazarus Mokgosi

Mr Zane Dangor, G20 Sherpa and Director-General of the Department of International Relations and Cooperation of South Africa.

Sherpas from G20 Members, Invited Guests and International Organisations

Members of the Economic Committee, North West Provincial Government, the Free State Provincial Government and the Northern Cape Provincial Government

Senior Officials from National Departments and the North West Province

Colleagues, Ladies and Gentleman

On this day, 70 years ago, 26 June 1955, the people of South Africa from all walks of life congregated under the hawkish eyes of the Apartheid government and declared the following:

We, the People of South Africa, declare for all our country and the world to know:

that South Africa belongs to all who live in it, black and white, and that no government can justly claim authority unless it is based on the will of all the people;

that our people have been robbed of their birthright to land, liberty and peace by a form of government founded on injustice and inequality;

that our country will never be prosperous or free until all our people live in brotherhood, enjoying equal rights and opportunities;

that only a democratic state, based on the will of all the people, can secure to all their birthright without distinction of colour, race, sex or belief;

And therefore, we, the people of South Africa, black and white together equals, countrymen and brothers adopt this Freedom Charter;

And we pledge ourselves to strive together, sparing neither strength nor courage, until the democratic changes here set out have been won.

With regards to International Relations they declared that:

There Shall Be Peace And Friendship!

South Africa shall be a fully independent state which respects the rights and sovereignty of all nations;

South Africa shall strive to maintain world peace and the settlement of all international disputes by negotiation – not war;

Peace and friendship amongst all our people shall be secured by upholding the equal rights, opportunities and status of all;

The freedom charter became the foundational document of our Constitution it informs our constitutional and international outlook. It is the bedrock of our human rights outlook domestically and internationally. So, when you hear us anchoring our international relations policy on human rights, it has a 70-year-old foundation, it will never change.

We’re glad you’re here in our country on this important day to find solutions to the people of the world. I hope your colleagues from the other tracks, Finance, and other working groups who’ve been meeting since the beginning of this year have told you about the scenic beauty of our country from Cape Town, Durban, the Pilanesberg National Park and here in Sun City the North West Province.

(If I have to boast, we’re very good hosts and yes, our wine is the best.)

We meet today at a time of profound geoeconomic tensions that continue to weigh on the global economy. Across the world we have seen various institutions such as the World Bank and IMF, amongst others revising down the global growth prospects in the wake of the geoeconomic tensions.

The African economies, and indeed here at home, we also face various headwinds. This moment makes the current engagements even more important in revitalising the world economies, and indeed, exploring opportunities for Africa, and South Africa.

In the very Province we are in today, the North West, lies many opportunities and resources. The province is not just rich in minerals it’s the heartbeat of the global energy and tech revolution. Beneath this soil lies the world’s platinum, gold, uranium, copper for wires, vanadium for batteries, fluorspar for medical tech. These are not just rocks they are the DNA of electric vehicles, renewable grids, and life-saving isotopes.  They are at the heart of global commerce.

Yet there’s a stark paradox: while the world runs on our resources, the value does not stay here. The minerals leave raw. The batteries, the solar panels, the cancer treatments are made elsewhere. We export wealth but import back its transformed value.  This is a phenomenon we see across Africa. In an award winning book Cobalt Red Siddharth Kara argues that : it is the blood of the Congo that powers our lives.

This is why South Africa’s G20 Presidency puts forward a Critical Minerals Framework that will rewrite this anomaly and revitalise our industrial strategies and manufacturing capabilities. Today’s system is unsustainable: As mineral-rich nations our path of development must be on equitable terms and importantly empower the citizens of our countries through job opportunities, and economic development.

Ladies and gentlemen, our mission is clear: we must turn these buried treasures into local jobs, factories, and sovereignty. Equally, the value we will create will still empower the world as we will seek to continuously export and strengthen global commerce, and our role in it.  This is not just economics; it is Solidarity, Equality and Sustainability – the theme of our Presidency. And without doubt the G20, is a platform that can ensure: the era of extraction without equity ends, and we begin an era of true partnership and collaboration for the good of sustainable development across countries.

Your Excellences,

This important meeting which comes at the midpoint of South Africa’s historic G20 Presidency, also coincides with unprecedented global turmoil both geopolitically and geoeconomically.

Aristotle’s observation is proving itself once again:

“It is more difficult to organise a peace than to win a war; but the fruits of victory will be lost if the peace is not organised.”

According to the OECD’s States of Fragility 2025 Assessment, the number of armed conflicts is at its highest level since the Cold War, with state-based conflicts including proxy wars, civil wars, coups, ranking as the top global risk for 2025.

State rivalries are fuelling fragmentation, with economic decoupling, and proxy conflicts undermining global stability. These international competition dynamics are exacerbating fragility in vulnerable regions while also weakening multilateral institutions that underpin the rules-based international order.

These are not just words here on our continent we have seen humanitarian crisis that is on a scale that the world has never seen with the conflict in Sudan. I venture to say this is no longer a crisis, but a moral emergency that demands our collective consciousness and humanity. Over 30 million people need lifesaving aid in Sudan, and more than 12 million have been displaced Africa’s gravest displacement crisis in modern history.

State sovereignty and the right to development and security are fundamental to a functioning international order. Now we see violation of these fundamental principles of territorial sovereignty and political independence enshrined in article 2(4) of the UN Charter, as some stretch self-defence into speculation.

Following last week’s US military strikes in the Iran, United Nations Secretary-General, Antonio Guterres said “At this perilous hour, it is critical to avoid a spiral of chaos,”

We understood the United Nation’s promise 80 years ago: collective security over coercion, the extinguishing of the law of the jungle! Alas we find ourselves in an evolving global disorder that brings with it many perils for the weak and vulnerable.

As South Africa, we have adopted an anti-war stance. This is because we know too well that war offers no victors, only victims. Double standards in diplomacy and the paralysis at the UN Security Council have crippled conflict resolution, mediation and peace efforts. These systemic challenges must be addressed to reclaim a global rationality that builds on stability, peace, certainty and sustainability.

The world needs more diplomacy and peace with the UN at its pinnacle.

Ladies and gentlemen,

Economic and technological pressures are immense and place further strain on a fatigued international system. The ever-worrying debt crises, supply-chain disruptions, and geoeconomic confrontation including tariffs only intensify instability and cause immeasurable pain particularly on countries of the global south.

The current and troubling global economic environment signifies a major trend towards economic nationalism; some states are distancing themselves from the globalised trade framework that has prevailed for many decades and underpinned this rules-based system of non-discrimination and shared values.

We must avoid this path, as we all know well that—trade is an engine for economic development and improvement in the standards of living across nations.

Your Excellences,

The digital economy undoubtedly continues to develop at a rapid pace, presenting both unprecedented opportunities and deepening inequalities across the globe. We must act with purpose to support digital transformation, equitable access to data and infrastructure and support innovation with a human-centric focus.

That said, cyber and hybrid warfare coupled with AI-driven threats create asymmetric risks, accelerating conflict escalation and reducing diplomatic windows of opportunity to act.

Ladies and Gentlemen,

The OECD report that I quoted earlier, further identifies and unpacks other very troubling trends. It estimates that 2 billion people live in fragile context , accounting for 72% of the world’s extreme poor. They face climate-driven disasters such as adverse and dangerous natural phenomena including severe heatwaves, devastating floods, hurricanes, droughts, and wildfires which exacerbate human insecurity.

Food security is of particular concern to us all as its causes are both climate driven and geopolitically imposed. These systemic challenges additionally extend to other key of human security concerns which are amplified by transnational threats including the forced migration crises, pandemics, and resource scarcity.

Sadly, sustainable development remains an aspirational goal not only for the G20 but the world at large. We are now only five years from the Agenda 2030 deadline, yet only 17% of the Sustainable Developments Goals (SDGs) are on track, while 35% are stagnating or regressing.

Honourable delegates, it is more than apparent that in the absence of sustained and continuous multilateral cooperation coupled with much needed reform to the existing global governance architecture these systemic challenges and highly probable risks will continue to undermine the rules-based international system entrenching inequality, unravelling global solidarity and creating the potential for irreversible fragmentation.

Transformational and peace-oriented diplomacy has become more relevant than ever before. Revitalising diplomacy and honest transparent engagements are critical to mitigating these challenges and creating conditions for credibility, peace, stability and equitable shared economic prosperity. Diplomacy’s role in peace, security, and human rights, must be underscored by fundamental international norms, values and principles that underpin humanity.

The G20 can lead in a moment of crisis. The G20 can help address the weaknesses of the multilateral system. The G20 can ensure that our collective humanity is not abandoned. Our deliberations can no longer be hollow; our shared prosperity now more than ever demands collaboration that pursues solutions that address some of the most pressing global challenges confronting humanity and impacting on global growth and development.

The G20 is persuasive body which holds great influence in the world.

I wish you well in your deliberations.

I thank you.

Auto industry continues to drive investment, jobs and innovation

Dear Fellow South African, 

South Africa has a well-established auto manufacturing industry that is more than a century old. It has proven to be one of the most resilient sectors of our economy. 

Since the first assembly plants were established in the Eastern Cape in the 1920s, the auto industry has grown to become the largest manufacturing sector in the country. South Africa’s role in global vehicle manufacturing has expanded and grown. 

Auto companies like Toyota, Ford, Nissan, Volkswagen, BMW and Mercedes-Benz have plants here in our country that produce vehicles for the local market and for export to many other countries in the world. 

 A number of these companies continue to expand their investments in our country. The sector currently supports more than 115,000 direct manufacturing jobs and more than 500,000 across the value chain. It contributes approximately 5.3% to GDP. 

However, the industry is under growing pressure. The introduction of stricter vehicle emissions regulations in leading export destinations such as the European Union, as well as new tariffs from the United States, are expected to have a significant impact on the sector. 

With exports currently accounting for approximately two-thirds of local vehicle production, it is critical that we strengthen the sector to not only overcome current headwinds, but to ensure its long-term sustainability. 

Last week, I attended the launch of BMW’s new X3 plug-in hybrid at the company’s Rosslyn plant in Tshwane. South Africa is the exclusive global production site for this model. The shift from internal combustion engines (ICE) towards hybrid and electric vehicles (EVs) in a number of markets means that green mobility is becoming increasingly important for automotive manufacturers.

The latest investment by BMW following their pledge at our South Africa Investment Conference in 2023 is a welcome signal to investors that South Africa remains a favourable place to do business. As Government, we are working to ensure there is an enabling regulatory and policy environment to support the growth of this burgeoning industrial activity. 

Our five South Africa Investment Conferences, where we invited companies to make investment pledges that are translated into actual investments, is an important platform for companies to declare their investment intention to South Africa and demonstrate that South Africa is an investable market.

Government support to the car manufacturing industry through the Automotive Production and Development Programme will position South Africa as a key global manufacturing base for vehicles of the future. 

This isn’t just critical to the sustainability of the sector, but to growing the workforce and skills of the future. 

BMW, for example, has a training academy that focuses on competencies like EV assembly and robotics. The company is also a founding partner of the Youth Employment Service (YES), which was established between Government and the private sector to create work experience opportunities for young people.

This initiative introduces young people into the world of work for a year of experience and training. Often if they meet the standards of the participating company they stand a good chance of being absorbed as employees of the company. BMW’s participation in this programme has supported more than 3,500 young people with training and work placements across all nine provinces. 

We have invited more companies to participate in the Youth Employment Service (YES) programme as broadly as BMW has done.

We are working to ensure that more production takes place locally, creating more employment. To do this, we must upskill our workforce and facilitate the creation of new companies across the value chain.

As such, we welcome initiatives by the sector to support skills development through initiatives such as the Centre of Excellence at the Tshwane Automotive Special Economic Zone. This centre has an artisan training academy, an incubation hub and a science, technology, engineering and mathematics programme for high school learners. 

There are also a number of industry-driven training initiatives focusing on technical and artisanal skills, and deepening collaboration between Government departments, vocational colleges and companies to grow a new skills pipeline.

Protecting existing jobs in the sector is paramount, particularly in the light of the looming US tariffs. The need to diversify our export base has become all the greater. We are committed to working with the sector to expand its continental footprint, building on the already strong growth of exports to the SADC region and leveraging the trade relationships that exist. 

Amid these challenges, South Africa’s auto industry is making the investments needed to build resilience, protect jobs and lead the way into a new era of green mobility. 

With best regards,

We are making steady progress on economic reform

Dear Fellow South African, 

Last week, we released a progress report on Operation Vulindlela, a Government-wide initiative to accelerate progress on economic reform.

This report shows that the economic reform programme is making steady progress, opening the way to more rapid, inclusive and sustainable growth and job creation.

We established Operation Vulindlela in the Sixth Administration to remove the binding constraints that have long held back our economy’s growth: an unreliable energy supply, inefficient rail and ports, high data costs, and a visa system that had deterred investors and tourists.

We have made significant progress since then in clearing these obstacles with a clear view to enhance economic growth. The reduction in load shedding over the past year was supported by the reforms that we introduced to unlock private investment in electricity generation, while reforms in the telecommunications sector have brought down the cost of mobile data. We have reduced the turnaround times for approval processes for water use licences and energy projects, made great progress in clearing the visa application backlog, and expanding the eVisa scheme.

In April this year, we commenced the next phase of Operation Vulindlela to build on these successes and initiate a second wave of reform. 

We are moving quickly towards a competitive electricity market, which will introduce greater competition in electricity generation and reduce the chances of experiencing load shedding again.

The reform underway in the energy sector will introduce greater choice for consumers and drive down costs. As part of this process, work is underway to establish an independent Transmission System Operator within the next five years, in line with the Electricity Regulation Act.

We have also made significant progress towards enabling greater investment in our transmission network, including from the private sector, with regulations to govern these investments.

In April, the Rail Infrastructure Manager was established as a separate operating division of Transnet with its own management and reporting structure. It has made capacity available across the freight rail network to private train operating companies and has received 98 requests for access to date.

A revised Network Statement will soon be published and capacity allocated in response to these requests, marking the start of open competition in freight rail. A Private Sector Participation Unit has been established within the Development Bank of Southern Africa to facilitate and fast-track private sector participation in logistics.

A request for information for private sector participation projects in the rail system and ports has received a strong response from the market, and will enable us to mobilise new investment to modernise and expand our logistics infrastructure.

The reform of our visa system is making it much easier for people to visit South Africa and bring much-needed skills and investment while enhancing border security through the Border Management Authority, which we established in the Sixth Administration as part of the reform process. An Electronic Travel Authorisation system has been developed by the Department of Home Affairs and is being prepared to go live in September 2025.

As part of Operation Vulindlela Phase II, we are also reforming the local government system to ensure that basic services such as water and electricity – which are essential for economic growth – are delivered efficiently and reliably.

Several metros have submitted plans for the turnaround of their water and electricity utilities that outline a clear pathway for the ring-fencing of water and electricity services. Progress against these action plans will enable these municipalities to access a new performance-based incentive from National Treasury to drive much greater investment in water and electricity infrastructure.

All of these reforms are designed to boost economic growth and create jobs for South Africans.

The claims by some opposition parties that these reforms represent a form of privatisation are baseless and misguided. The measures we are taking are common sense reforms that will preserve public ownership of key infrastructure while introducing greater competition, dynamism and investment. A number of our peer countries introduced similar reforms, which have powered their economies to higher levels of growth.

Even as the world faces difficult economic headwinds, our economic reform agenda will create the conditions for higher growth and investment, while renewing our infrastructure for generations to come.

With best regards,