Gqeberha: Deputy President Paul Mashatile has announced that President Cyril Ramaphosa will send a delegation to the White House to discuss trade tariffs with United States President Donald Trump’s administration. Deputy President Mashatile stated that the recently announced tariffs could disrupt trade flows and undermine the global competitiveness of the local automotive sector.
According to South African Government News Agency, as of 8 August 2025, a 30% tariff on all South African goods entering the United States is now in effect. “We will continue engaging with the USA to identify practical solutions. The President will be sending the delegation once again to the White House to engage with the US administration on this matter,” Mashatile said during his keynote address at the National Association of Automotive Component and Allied Manufacturers (NAACAM) Show 2025 in Gqeberha, Eastern Cape.
Mashatile emphasized the significance of the African Continental Free Trade Area (AfCFTA) agreement on economic integration and industrialization, which is expected to attract additional international investment into the African automotive industry. Creating a single continental market for goods and services could potentially lead to increased trade, investment, and job creation within Africa. “However, this does not suggest that we do not need other nations as trading partners. We believe in diversifying our investments and engaging in trade with several partners,” he added.
The Deputy President affirmed that the Cabinet is committed to protecting the economic interests of the country and is focused on strengthening the economy while addressing the challenges of unemployment, poverty, and inequality. He warned of repercussions across the entire value chain if an amicable trade agreement is not reached with the White House, highlighting the potential volume reductions faced by South African suppliers supporting domestic original equipment manufacturers (OEMs) exporting to the United States.
South African automobiles and components would see a direct rise in the landed cost in the US market, making them less competitive compared to goods from nations with preferential or zero-duty access, such as those in the USMCA (United States, Mexico, Canada Agreement). “Overall, the imposed tariffs threaten to disrupt well-established trade flows and weaken the global competitiveness of South Africa’s automotive manufacturing ecosystem,” Mashatile noted.
Despite these challenges, Mashatile believes South Africa remains resilient in its economic growth efforts. He called for government-private sector collaboration to address issues like the 30% tariff increase, import dependence, infrastructural inadequacies, and the transition to electric vehicles (EVs).
He praised NAACAM for investing in improving the localisation, transformation, and supplier development landscape in South Africa. The automotive industry, crucial to the nation’s GDP and employment, accounts for 22.6% of manufacturing output and contributes 5.2% to the GDP, employing around 115,000 people, with over 80,000 in the component sector.
Mashatile expressed concern over employment levels in the sector, which have been strained by ongoing economic pressures and reduced production volumes. In the past two years, NAACAM reported the closure of 12 companies, affecting over 4,000 people. He emphasized the need to combat unemployment through education, skills development, entrepreneurship promotion, and public employment programs.
The Deputy President reaffirmed the government’s commitment to working with various sectors to create employment and improve living conditions, acknowledging the automotive industry’s significant role in economic growth, industrial development, and innovation.