For two decades, the African Growth and Opportunity Act (AGOA) has been a significant component of South Africa’s export and competitiveness strategy.
It provides duty-free access to the world’s largest consumer market, supports container traffic and enables agricultural products such as citrus fruits, nuts, wine and fruit juice to reach US shelves at preferential tariffs.
The benefits are real, but the dynamics are changing them now.
A newly introduced US Senate bill, the AGOA Bilateral Engagement and Extension Act of 2025, proposes a two-year extension of AGOA through 2027, but simultaneously forces a complete overhaul of South Africa’s bilateral relationship with the United States.
Unlike past eligibility reviews that focused on trade or human rights criteria, this one introduces a political and geopolitical filter.
It is stated in the bill that:
“The ANC’s foreign policy actions have long reflected its stated stance of non-alignment and now directly benefit the People’s Republic of China, the Russian Federation, and Hamas, a recognized proxy of Iran, thereby undermining the national security and foreign policy interests of the United States.“
The language is unusual because it targets not the government but the ANC as a political actor, despite it no longer being the full majority party. This suggests that eligibility can depend not only on government behavior, but also on perceived political alignment.
This marks a shift: AGOA is no longer just a trade priority, but is becoming a platform through which Washington communicates strategic boundaries.
Worry, not disaster
The agribusiness sector, one of AGOA’s biggest beneficiaries, may approach this issue with caution rather than panic.
Agricultural economist Wandile Sihlobu, one of the leading voices in the trade, emphasizes that South Africa’s engagement with the US market remains meaningful, but contingent:
“The United States remains an important market for our agricultural exports, accounting for approximately 4% of South Africa’s total agricultural exports, valued at $13.7 billion in 2024.
He also mentioned the importance of ongoing negotiations.Much depends on whether South Africa succeeds in securing favorable trade terms with the United States“
None of these statements predict collapse. Rather, they show that the outcome is dependent on the diplomatic situation, not inevitable.
The Washington Perspective: Trade as a Geostrategic Tool
US lawmakers are increasingly framing AGOA through the lens of global influence rather than market access.
Senator John F. Kennedy, who introduced the bill, stated:China is using Africa to expand its influence at the expense of America.
We need to rethink our relationships in the region while strengthening trade with African countries that share our values. This bill ensures that AGOA works for America’s interests, not against them.“
Whether this is a threat or not again is a question for the ages, especially given the recent failure of the US not to attend the G20.
The United States shows that trade preferences are no longer instrumentally neutral, but contingent on perceived alignment.
Consequences of AGOA elimination – the reality of shipping and exports
If South Africa were to withdraw from AGOA, a scenario that has yet to be determined, the consequences would not be to cut off US access.
Instead, tariffs will return to the level of favored countries, which may reduce price competition. Exporters with:
- Higher land costs, which compress margins rather than ending the business immediately.
- Changes in logistics flows, as some volumes revise routes or timings.
- Arrangement of documents, especially regarding certificate of origin and tariff codes.
None of these pose an existential threat, but they increase the cost of doing business in the US market, where Chile and Peru already enjoy tariff advantages.
Less panic, more preparation
The current situation is described not as a crisis, but as a hinge moment. The US has opened the door to revision, it is not yet closed. The bill creates the conditions under which South Africa’s AGOA eligibility can be questioned, but does not state the outcome.
Diplomacy, clarity of foreign policy position, and responsiveness to US concerns can maintain access.
Ignoring these dynamics creates a degree of risk, especially for businesses whose profit margins rely on predictable fee structures.
Where does this leave SA exports?
The transportation and logistics department should interpret this moment as follows:
- A signal for surveillance, not panic.
- A quick plan for the scenario, not an overnight rebuild.
- An opportunity to assess exposure, not assume the worst.
If the United States today remains a 4 percent market for agricultural exports, its importance lies not in volume but in the value of strategic diversification, the loss of discretion in one corridor increases dependence elsewhere.
And dependence in business always has a price.
The narrative here is not condemnation, but a narrative of conditional continuity. South Africa is asked to explain its position on AGOA.
This can be seen as a negotiation, and with any negotiation, there is leverage, and Washington has just put its leverage on the table.
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