South Africa’s graduation from the African Growth and Opportunity Act (Agoa) does not mean it will lose access to the US market. It will retain access, but face slightly higher tariffs.
While the country is now operating in a different political climate, it is important to remember that discussions about South Africa’s eligibility for Agoa and its eventual graduation from the programme have been under way for some time.
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In 2014, for example, one of the issues raised was that South Africa, as an upper-middle-income country, should graduate from Agoa and pursue a full bilateral trade agreement with the US.
South Africa faced its own complications, however, including its membership of the Southern African Customs Union (Sacu), which limits its ability to negotiate bilateral trade agreements independently.
The country also lobbied to retain the benefits of Agoa’s unilateral trade arrangement.
What this means
In retrospect, had South Africa found a way to graduate from Agoa when it faced pressure to do so and begun negotiations on a trade agreement, it might now be operating in a different political and trade environment.
That said, having a trade agreement does not necessarily protect countries from significant changes in US trade policy, as developments affecting countries such as Canada have demonstrated.
Read: South African businesses see ‘minimal’ impact of Agoa exclusion
Beyond South Africa’s graduation from Agoa, there is also some confusion about what it means in practice. Some have portrayed the move as a complete ban on South African products entering the US market. This is not the case.
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The tariff impact
Put simply, South Africa’s transition out of Agoa would mean facing an additional Most Favoured Nation (MFN) tariff of about 3.4 percentage points on top of the tariffs imposed by the current US administration on various countries.
Some South African products currently enter the US market at a tariff rate of 12.5%, following the so-called Liberation Day tariffs. Without Agoa, this would increase to 15.9%, potentially making certain South African products slightly less competitive.
Although this presents a challenge, it is not necessarily as catastrophic as some have suggested.
South African exporters have previously remained competitive despite facing considerably higher US tariffs.
Consider the agricultural sector. In 2025, South African agricultural products faced tariffs of about 30% when exported to the US. Despite this, exports remained relatively strong.
Agricultural exports under pressure
South Africa’s agricultural exports to the US totalled $504 million in 2025, down 3% from the previous year.
During the 90-day pause in the Liberation Day tariffs in the second quarter of 2025, some South African agricultural exporters took advantage of the opportunity to increase shipments. Exports subsequently slowed in the third and fourth quarters.
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In the third quarter of 2025, South African agricultural exports to the US declined by 11% year on year to $144 million. The decline was more pronounced in the fourth quarter, when exports fell by 39% to $81 million.
Nevertheless, total exports for the year remained encouraging.
South African agricultural exports to the US also performed strongly this year. Between the first and second quarters of 2026, they increased by 56% to $123 million.
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The reduction in US tariffs from 30% to 12.5%, among other factors, was a major contributor to this increase.
Key export destination
The US remains an important destination for South African agricultural products, accounting for about 4% of the country’s agricultural exports. Key products exported to the market include citrus, berries, grapes, raisins, wine, fruit juices, apples, pears, apricots and nuts.
South Africa’s graduation from Agoa should therefore be considered in the broader context of its trading relationship with the US.
While the higher tariffs will affect certain industries by reducing their competitiveness, the change does not necessarily spell disaster for the country’s exporters.
It is important that the implications are communicated clearly and that the narrative around the issue is managed carefully.
Diversifying export markets
More broadly, the development reinforces the need for South Africa to diversify its export markets towards growing regions such as Asia and the Middle East.
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However, export diversification should not be viewed as a replacement for established markets such as the US, European Union, UK and Africa. These remain important trading partners, and South Africa must continue working to preserve and strengthen its access to them.
Wandile Sihlobo is chief economist of the Agricultural Business Chamber of South Africa (Agbiz).
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