Trump land in South Africa may shift from aid to trade

South Africa appears to be at a crossroads in its waxing and decline relations with the United States after Donald Trump’s decision last week to reduce economic aid to the country.

Trump said South Africa is pursuing what he calls “unjust and immoral practices” against white Africa Dutch communities and filed a genocide case against Israel in December 2023 at the International Court of Justice (ICJ).

His move has caused shock waves throughout South Africa, and experts fear he may continue to take advantage of the opportunity to end preferential visits to the U.S. market with its special American African Trade Program (AGOA) (AGOA).

Since anti-apartheid idol and Nobel Peace Prize winner Nelson Mandela was elected as South Africa’s first black president in 1994, the two countries have usually developed friendly relations.

Although it took us 14 years to remove Mandela from his “horror watch list” for his role in the racist system with racism, which was the then Afrikana ruler of South Africa in 1948 Introduced in 2019.

South African President Cyril Ramaphosa broke out in the latest tension just days after Trump’s inauguration last month Signing the Law Examination ActThis allows the government to confiscate land without compensation in some cases.

Trump’s response came last week When he threatens to cut future funds The country’s leadership is doing what he calls “terrible things, terrible things”.

The U.S. President further accuses South Africa of having no basis and not actually “confiscating the land” and “doing something that might be worse than that.”

He doubled in the face of a strong rebuttal from the South African government and signed an executive order last Friday.

That totals nearly $440 million (£353 million) – amounts of aid allocated in 2023 – although the U.S. Embassy in South Africa later said the U.S. plan funding was funding for a U.S. program targeting global HIV disease Will not be affectedplus the warning that “not all Pepfar activities will resume”.

South Africa is one of the biggest beneficiaries of PEPFAR, which contributes about 17% to its HIV/AIDS program, which has approximately 5.5 million people undergoing antiretroviral disease.

Trump also accused South Africa of “shockingly ignoring its civil rights” under the execution order and “positive stance” on the United States and its ally Israel in the International Court of Justice.

In addition to the aid freeze, Trump has also proposed to help refugees in the Afrikaan community, the whitest descendants of early Dutch and French settlers to settle in the United States.

His stance has been played in the hands of conservative Afriforum and Locarity, including Afriforum and Locarity, who want the government to repeal what it calls “race-based laws” such as affirmative action and black economic empowerment.

That’s the view of Elon Musk, a close adviser to Trump, the South African-born billionaire. He questioned why Ramaphosa “opened racist ownership law.”

This is not the first time South Africa has aroused Trump’s anger.

In 2018, during his first presidency He accused South African authorities of “mass killing farmers” And asked his then Secretary of State to investigate the government’s “grab land from white farmers.”

Trump’s rhetoric triggered a rebound at the time, but Dr. Oscar Van Heerden, a political analyst at the University of Johannesburg, told the BBC that “that this radical action has never been taken, so much so that The point of signing the executive order”.

As their relationship is now in a volatile state – both countries are weighing the next move.

On the trade side, Donald Mackay, CEO of Johannesburg-based trade consulting firm XA Global Trade Advisors, said that although the United States is one of South Africa’s largest partners, it is not its “closeest trading partner.”

South Africa exports a variety of minerals, including platinum, iron and manganese, to the United States.

It is also one of the largest exporters under AGOA, with revenue of approximately $2.7 billion in 2023, mainly from the sale of vehicles, jewelry and metals.

“For years, this relationship has been waxed and weakened. It has never been very powerful (because white fine rule ended in South Africa). But at the same time, I don’t think it has worsened as it has in recent years. I don’t think it’s South Africa’s. Wrong,” Mr McKay told the BBC.

But he admits that in recent years, South Africa has done a lot of “a lot” to stimulate the United States.

“These stimulus can accumulate and under President Trump’s leadership … This is seen as an opportunity to replace South Africa.”

Dr. Van Heerden attributes the dynamic changes in part to “global change” and “new competition, from China, India and Brazil, all from the United States to the United States.”

While experts talk about the benefits of the AGOA to be reviewed later this year, they agree that the impact may not be as important as some fears.

AGOA was launched in 2000 It offers over 1,800 products with no remittance scope for eligible sub-Saharan African countries.

Mr McKay said he would be surprised if South Africa continues to benefit from the offer agreement after the review.

“My instinct is that no matter what the reason why Trump is upset about South Africa, Agoa is the easiest mechanism to punish South Africa at the moment.”

Dr Van Heerden added that even if there is no renewal, or South Africa is ultimately excluded, those businesses that currently benefit from it will suffer short-term losses but will rebound within a few years.

He said that at present, President Ramaphosa’s administration has chosen a diplomatic avenue – although the Trump administration appears to have insufficient interest in diplomacy, greatly reducing the chances of success.

South African Foreign Minister Ronald Lamola Blunt’s reaction to Trump’s actions on Wednesday may not help, saying South Africa has no chance to withdraw its case against Israel in the International Court of Justice.

“Relying on our principles sometimes has consequences, but we firmly believe that this is important to the world and the rule of law,” he said. Ramora told the Financial Times.

South Africa accused Israel of genocide against Palestinians living in Gaza, an allegation that Israel denied.

Meanwhile, Ramaphosa announced as G20 president that he would send delegations around the world to clarify South Africa’s domestic and foreign policy – Washington is the key to stop.

Last December, South Africa served as president of the G20, a series of countries discussing global economic and political issues with global economic and political issues, and believes it is an opportunity to strengthen their international status.

But in a snub to South Africa, U.S. Secretary of State Marco Rubio announced that he would not attend the Foreign Secretary meeting next week in Johannesburg.

“My job is to promote the national interest of the United States, not to waste taxpayers’ money or anti-Americanism,” he said.

South Africa is part of the BRICS countries, as well as a coalition of major developing countries, including Brazil, Russia, India and China, who are trying to challenge the political and economic power of wealthy countries in North America and Western Europe.

Mr McKay believes that South Africa and other countries will have a hard time driving relations with the United States under the “most unpredictable politician in the world”, indicating that they will have to increasingly see the BRICS countries as alternative partners.

But for South Africa, the EU (EU) is one of its largest trading partners, reaffirming its support for the country.

European Council President António Costa sets general political direction and priorities for the EU – Posted on X on Monday He spoke with Ramaphosa over the phone to highlight “the EU’s commitment to ties with South Africa”.

Mr Van Heerden suggested that if South Africa’s charm offense fails, the government can choose to “negotiate hard” and use the minerals it provides to the United States as “bargaining chips.”

But he issued a warning: “South Africa will have to think carefully about how they play this chess game (where) President Trump and Elon Musk have made the opening remarks.”