THE PHOENIX
The end is naai?
When the US administration threatened to implement 50 percent tariffs on Lesotho in April 2025, many US importers cancelled orders for Lesotho produced textiles, which led to the loss of many jobs. And even though Lesotho has been given a revised tariff rate of 15 %, the damage has been done, and as one wag put it, for a lot of them the end is naai.
For those who don’ t understand, naai is actually the Afrikaans word for sew, not the( ahem) common slang meaning, and the wag was basically saying that the export deal that had been sewed up, years ago, was now unravelling. A similar situation is now facing the South African automotive industry.
When US President Donald Trump announced that imports from South Africa will be subjected to 30 % duties, among a slew of levies that will be imposed from August 7th as part of his efforts to reshape America’ s relationships with its trading partners, a Lesotho type scenario unfolded, and sent shivers down the spines of our automotive executives. advise companies affected by the tariffs and indicated they would be assisted financially, but didn’ t specify how much money would be made available or how it would be disbursed. Also on the cards are changes to anti-trust rules, including a block exemption that will allow exporters to collaborate.
“ We are going to cabinet on Wednesday with a set of more detailed proposals that we are finalising, that will elaborate on the structure of the
The country also plans to sign a memorandum of understanding on industrialisation with China, which aims at further enhancing its export offering, he said.
South Africa shipped goods worth $ 14.7 billion( R263 billion) to the US last year, its second-biggest export destination after China. While the government’ s efforts to open up new markets is a welcome development, the process will take time and it will be hard-pressed to compensate for less favourable access to the world’ s biggest economy, analysts and business groups say.
Lobby group Business Leadership South Africa expects the new tariffs to pose a severe threat to the country’ s manufacturing and farming industries, particularly in the Eastern Cape province.
A little bit late, but an article that was sent to me on 6 August, shows that the South African government is sitting up and taking notice. https:// topauto. co. za / reports that“ South Africa’ s government is putting the final touches to an overarching package that aims to shield businesses against the fallout from punitive US trade tariffs and plans to present it to lawmakers later this week”. The article, titled How South Africa plans to save its car factories, says that“ The move will affect about 30 000 jobs in South Africa”, as Simphiwe Hamilton, the trade department’ s director-general, told reporters at a briefing in Johannesburg.
The impact will primarily impact the agricultural and manufacturing sectors, including the country’ s major car factories. The department last week said it would set up a support desk to support package,” Trade, Industry and Competition Minister Parks Tau told the briefing.
In his weekly newsletter issued earlier Monday, President Cyril Ramaphosa said South Africa plans to scale up its trade missions into new markets in Africa and beyond. He also mentioned the National Exporter Development Programme, which aims to grow the pool of export-ready companies. Tau said the market-diversification drive is already bearing fruit, with exporters making significant inroads into new, high-growth markets across Asia and the Middle East, including the United Arab Emirates, Qatar and Saudi Arabia.
“ A Trade Crisis Committee should be established, modelled after successful crisis response frameworks like the National Electricity Crisis Committee,” it said on Monday.“ This body, including the National Treasury, business leaders, and key government departments would ensure fast, coordinated action to open new markets, provide financial support and maintain employment.”
We shall see, but at the moment I think the end is naai for the automotive industry, unless more aggressive action is taken.
AUGUST 2025 3 WORDS IN ACTION