The United States will remove South Africa from the African Growth and Opportunity Act (AGOA) on 1 January 2027, ending duty-free access to the US market for qualifying South African exports. Economists say the direct cost to growth will be modest but warn of a larger effect on investor confidence.
US Trade Representative Jamieson Greer announced the decision on 2 November after an annual review of eligibility. He said President Donald Trump had notified Congress and the governments of South Africa and Rwanda of his intention to end both countries’ eligibility. Greer cited barriers to US trade and investment, corruption, and threats to US national security and foreign policy interests in South Africa. He added that Washington was working to ensure African partners meet the programme’s criteria, and that countries removed from AGOA can be reinstated.
South Africa is the largest beneficiary of AGOA, which gives duty-free access to more than 1,800 products from eligible sub-Saharan countries. Johann Els, chief economist at PSG Financial Services, said South Africa accounts for more than half of all AGOA-related exports to the US.
| Indicator | Value |
|---|---|
| SA goods exports to US, 2025 | about $16.5bn (R272bn) |
| US share of SA’s total goods exports | about 7% |
| Exports entering under AGOA preferences | about $1.6bn (R26bn) |
| AGOA share of SA exports to US | about 10% |
| AGOA share of SA’s total goods exports | about 0.7% |
| SA share of all AGOA exports to US | more than 50% |
Els said the headline figures overstate the direct exposure. Only about 7% of South Africa’s goods exports went to the US in 2025, worth around $16.5 billion (R272 billion). Of that, about $1.6 billion (R26 billion) entered under AGOA preferences, which is around a tenth of exports to the US and less than 1% of total goods exports. He said exports to the US would continue, although some products would become less competitive once ordinary import duties apply.
The Department of Trade, Industry and Competition gave similar figures last week. It said it was prepared for the decision, and that AGOA was important but did not make up the whole economic relationship with the US. The government said on Monday that it would support affected sectors. President Cyril Ramaphosa had earlier urged exporters to prepare for exclusion by looking for new markets, including China.
The impact will not be spread evenly. Els identified automotive, agriculture (including citrus, wine and table grapes), and some manufacturing and metals producers as the most exposed. Jobs in the citrus industry are seen as particularly vulnerable. He also pointed out that AGOA removes only ordinary import duties and does not shield goods from additional US tariffs. South African exports have faced a 12.5% Section 301 tariff since July, although products already covered by Section 232 duties are exempt.
The decision comes after more than a year of deteriorating relations. AGOA lapsed in September 2025. Trump signed an extension in February that ran to the end of 2026, and then a further extension in September that took the programme to 2028, well short of the 15 years Pretoria had wanted. The president retains the power to review each country’s eligibility every year. Washington has criticised South Africa’s ties with Iran, its case against Israel at the International Court of Justice and its black economic empowerment laws. US Ambassador Brent Bozell said the termination followed South Africa’s failure to make the policy changes the US had sought.
In Washington, Richard Neal, the senior Democrat on the House Ways and Means Committee, said the move could disrupt the US economy. He called on the administration to set out clearly how South Africa could be reinstated.
Els said the main risk lies beyond the trade numbers. Less than 1% of goods exports depend on AGOA, and the direct effect on growth is likely to be small. He said the losses would still matter for the companies and workers affected, but the larger concern is the signal the decision sends to investors and its effect on confidence, investment and relations between the two countries. He cautioned against confusing South Africa’s large share of total AGOA trade with the much smaller share of its own exports that relies on the programme.