Hello and welcome to the So What Podcast, in
which political economic analyst J .P. Landman
discusses the issues uppermost in the minds of
South Africans. You can find a written version
of this content on J .P.'s website, jpluntman
.co .za. I am Ruda Landman, and I am your host.
The So What Podcast goes with J .P.'s newsletter,
which you can find on his website. This one is
dated the 20th of March, 2026. And the title
is US, China, South Africa, Corvadas. With the
whole world focused on the Middle East, what
draws your attention to this discussion? Indeed,
and two things happened. The one was, which was
very well covered in the media, the comments
that the new US ambassador to South Africa, Mr.
Boesel, made, which, as I said, enjoyed a lot
of media coverage. And then a statement which
was made by President Xi Jinping in Beijing,
which attracted a lot less coverage. And so...
Those are the two things that spurred me on to
focus on this topic. Now, to discuss this topic,
I think we must first take a step back and go
14 years back in history to 2012 when the National
Development Plan was released. by the then National
Planning Commission, chaired by then Minister
Trevor Manuel. And essentially what the National
Development Plan postulated in 2012 was that
power is shifting from the West to the East and
that South Africa must position itself accordingly.
Now, you may well ask, what does that mean? And
I think the meaning is that you've got to maintain
relations with the old, but also develop relations
with the new. So you've got friends in the West.
maintain those relations, but there are new powers
coming up in the East and develop new relations
with them. That was long before it was anything
near as clear as it is now. No, absolutely. Almost
a decade and a half ago. And what has happened
over this decade and a half is that South Africa's
trade, South Africa's exports have followed that
trajectory. Today, as in 2025, 35 % of our exports
go to Asia. Now, Asia includes China, of course,
India, but also other countries. 25 % of our
exports go to the European Union, 25 % goes into
Africa, and the remainder, 8%, goes to North
America, 4 % to the Middle East, and 3 % to South
America and Australasia. So you can see that
our trade has already shifted along the lines
that a national development plan postulated 14,
almost 15 years ago. Now, I think what is important
to do is to appreciate that. When we say South
Africa exports to China or South Africa exports
to the EU, in a sense it's nonsense because it
is not the countries of Africa that are exporting.
It's not the government. It's not a central agency
that collects all the exports and takes them
out. It is hundreds if not thousands of individual
businesses, some of them small craft makers,
some of them big mines, some of them big factories.
It's a range of individual businesses and enterprises
that take these export decisions. And their decisions
over time has added up to the numbers that I
quote. And I think that's a very important point.
It's individual businesses taking decisions.
What was President Xi Jinping's announcement?
It's a very interesting announcement. On the
12th of February, he announced that in future,
from the 1st of May, 2026, all tariffs on all
products from all African countries are scrapped,
made null. The only exception is Eswatini because
Eswatini recognizes Taiwan. But all other countries
in Africa can now export tariff -free into China.
What are we paying at the moment? It varies.
On some products, it's null. But in general,
the tariffs that South Africa pay on exports
into China is between 10 % and 25%. So it's a
big change that is being made. At the moment,
the estimate is that about 8 ,940 product lines
will go into China data -free. It's a huge announcement
for the exporters of this country. Are you seeing
other indications on the ground of the rising
importance of China? Oh yes, absolutely, particularly
in the motor industry. You would have seen that
Nissan, it's been in South Africa for many years,
is closing its factory that it has in Tswane,
but the factory and the staff. will be taken
over by Chedi, the Chinese company. So you're
just replacing one manufacturer with another
and production carries on with of course different
products. The other announcement was subsequent
to that was the Great Wall Motor Company, GWM.
they revealed that they are talking to Mercedes
-Benz to use the Mercedes -Benz factory in East
London for the production of GWM products. Now,
they haven't made a deal yet. They made that
clear. And they're also talking to other parties.
But it is possible that a deal may, kind of a
sharing deal may be concluded. Now, what is interesting
here is that an old hand in the motor industry
told me that when he bought his first car many
years ago, it was an Alfa. And the Alfa was manufactured
in that Mercedes -Benz factory in East London.
So sharing is not a new idea. And it looks as
if the Great Wall Motor Company is looking at
that. And what about exports to America? What's
happening there in the meantime? Well, as you
know, America has levied a 25 % tariff on automotive
exports. That's this week. It might be different
next week. Indeed. 25 % duty on exports into
America. Now, that, of course, must hit the Mercedes
-Benz factory in East London really hard because
they produce the C180 Mercedes for export into
the US. And one can only assume that those exports
are taking a knock. And for them, therefore,
it will make sense to share the factory with
the great Walmart company. So our trade with
China is very definitely on an upward trajectory.
What's happening with the US? I think you've
just started to indicate that that's going down.
No, indeed. We don't have the latest numbers
yet. We'll only get it in due course. But look,
the trend, I think, is clear. First of all, President
Trump believes in tariffs. He has believed in
them for many, many years, and it's a fundamental
part of his thinking. So he has imposed tariffs
on the whole world, friend and foe. Whether you
were a friend of the United States or an enemy
of the United States, you got tariffs. In fact,
it looks as if some enemies like the USSR or
Russia, rather, and China were treated more benignly
than some of his friends. some of the loyal friends
over many years. But be that as it may, he levied
tariffs on all of them. Even countries that have
succeeded in negotiating a trade agreement with
the US. are levied with tariffs. They had to
agree to tariffs in order to get the agreement
with the US. So I think we must accept that US
tariffs on exports or imports from the world,
exports from the rest of the world into the US,
will remain under tariffs in one way or another,
certainly as long as Trump is around, and I think
even after him. And the reason I say that is
we know from history that tariffs are very sticky.
Once you've put them into place, it's very, very
difficult to get rid of them. Because tariffs
create beneficiaries and they create advantages
for some classes of people. And those people
will fight like hell to retain them. So tariffs
are sticky. And I think we can accept that they
will stay with us. Some of our exports are exempt
from the tariffs, though. About half are exempt
from tariffs. You're quite right. It's mainly
minerals as well as citrus. So clearly, Mr. Trump
would like to have those products at a cheaper
price and not a price plus tariff. That's how
it is in the moment. So South Africa has tabled
a draft agreement, trade agreement with the US.
We're keen to negotiate one. That agreement was
tabled last May already. So it's almost a year
ago. And since then, there's been no public progress.
Maybe there has been progress in private, but
it doesn't look like it. In January this year,
when he was in Davos, our trade minister, Park
Stau. revealed that we're still waiting for the
Americans to give us dates for meetings to take
place. Now, apparently, I understand that recently,
in the last week or 10 days, meetings have been
arranged, but whether anything will come of it,
we'll have to wait and see. I'm very doubtful.
I will not hold my breath, simply because the
Americans have now introduced five preconditions,
which are non -trade conditions that must go
into a trade agreement. And this was clearly
spelled out by Ambassador Boesel in his speech
in South Africa. And they relate to expropriation,
farm murders, B .E., kill the Boer chant, as
well as geopolitical alignment. The ambassadors
made it clear that the U .S. is not going to
look at anything if it doesn't accommodate these
five demands. On the other hand, it's quite clear
that the five demands are politically impossible
and they really are an attack on the sovereignty
of South Africa. So I don't see much room here
for a trade agreement, unless the Americans give
way, which is not impossible. But I don't think
there's a chance for an agreement to come into
existence. So we will have to live with whatever
tariffs the U .S. wants to impose. What about
AGOA? AGOA is dead. People constantly refer back
to it. The reality is simple. AGOA expired in
September last year. In February, it was renewed,
but it's only renewed until the end of 2026.
It's now already March, so you only have about
nine months left. In any case, the tariffs that
Trump has levied... overtake or override AGOA.
So, for example, the general 10 % tariff on air
exports, that overrides AGOA. The 25 % tariff
on automotives and automotive products, that
overrides AGOA. So AGOA, for all practical purposes,
is dead. And certainly after 2026, it will be
completely dead. So I don't pay any attention
to AGOA as a means of regulating trade. But then
you say, in the meantime, as you put it, life
carries on. What do you mean? Life carries on
in the sense that there are currently more than
500, some estimates say 600, US companies operating
in South Africa. That's a large number of companies.
And presumably they won't operate here if they
don't make money, if it's not to their benefit.
So they carry on. They make money. They're happy.
They comply with BE legislation and so on. And
they live with whatever the problems and constraints
are in South Africa. And it looks as if more
companies keep on coming. I mean, just in the
last week. The big IT company, IT servicing company,
Spinnaker, announced that they are operating,
opening an office in South Africa in partnership
with Patrice Motsepi's ARC, African Rainbow Capital.
It's a middle -sized company, but it's taking
on other people operating in the South African
market, bringing competition. Secondly, there's
a U .S. company called Rainbow Minerals, not
to be confused with Mozepe's Rainbow Minerals,
and they are testing it at the laboratories at
Mintec in Randberg to extract rare earths from
the soda ash at Palaborba. That's quite an important
project, rare earths for the U .S. And lastly,
Amazon, in direct competition with Starlink,
is preparing to launch its own low -Earth orbit
satellites with South African partners that are
locally licensed. So Starlink is not the only
low -Earth orbit satellite provider. Others are
there too, and they're making their services
available. So it is the same as with exports.
Individual companies take decisions and they
carry on with their business. They want to export
to a country, they will do that. They want to
open business, they will do that. And that's
what we're seeing here. What's happening between
us and the EU and the UK? Well, very interesting.
It's beyond the scope of this note, but I think
one should just note that, as I've said, the
EU takes 25 % of our exports. We've now, in the
last year, in 2025, towards the end of the year,
we've signed three agreements with them. One
is a clean energy and investment agreement. A
second one is on rare earth minerals. and how
one has to deal with that. And the third one
is a comprehensive package of project totaling
about 12 billion euros, which is a lot of money.
So these three agreements were signed in the
latter half of last year, and our trade with
the EU will just carry on. There are at the moment
about 1 ,000. EU and UK companies operating in
South Africa. Compare that to the 600, 500 to
600 from the US. And it gives you an indication
of how strong our trade relations with the EU
are. And it will probably expand. I think that's
the way it's going. So what? Well, I think the
first so what is that the question I ask in the
topic, in the title of this piece, South Africa,
US, China, Quo Vadis, where to? I think the answer
to the Kuwaitis question is that there's a big
repositioning taking place. And this repositioning
was predicted as long ago already as in 2012.
So in that sense, it's not new. And we've seen
how our trade has changed to accommodate that.
So it is not a new development, but I think it's
a very decisive development. I think the other
so what is that the contrast between the way
that China approaches South Africa. and the whole
of Africa, for that matter, and the way that
China and the way that the U .S. approaches South
Africa is very, very different. And you can only
draw your own conclusions as to how that will
affect trade going forward. Likewise, the EU
and South Africa are moving closer together,
and the trade and investment on that front will
probably also increase. I think the other so
-what -to -do is that The United States and its
Margo supporters here in South Africa will have
to accept that the problems in this country,
whether it's expropriation or crime or whatever,
will be solved by the people of this country.
It will be solved through executive action, through
political negotiations and through the courts.
It is not going to be solved by outside diktat.
Trump is not going to rush in on Air Force One.
and tell the country what to do. That's not going
to happen. So those problems must be sorted out
here. And people will have to accept that. I
think it's very sad that the US policy towards
South Africa has been captured by the Afrikaner
genocide narrative. That brings distortions which
are not good for the relationship. And they will
have to work through that. So many people say...
We were at fault in our relationship with the
US and that's why they are so nasty towards us,
President Trump specifically. I don't buy that
at all. I think it is true that South Africa
has neglected the relationship. We haven't had
good, efficient ambassadors there. The last one
was Ibrahim Rasool in his first term, which ended
in 2014, I think. You'll recall when we were
in the US in 2013 -14, Rasul was regarded as
one of the most effective ambassadors. His second
term, of course, didn't work out like that. But
after Rasul, we haven't again had effective diplomacy
in the US. So in that sense, it's true. But no,
I don't think it's our fault. Trump made it clear
that very good, loyal friends like Japan, like
South Korea, like Canada, they all got a kick
in the butt or a kick in the face, should I rather
say. That is what Trump, that's his style. That's
what he's doing with tariffs. So, no, I don't
think it's our fault. We have the right to decide
how we run our affairs here inside the country,
just as the Americans have got the right to decide
theirs. We don't criticize their domestic policies
or, for that matter, their foreign policies,
like the current war in Iran, for example. So,
no, I don't buy the argument it's our fault.
The furthest I would go is to say that we've
neglected the relationship and we've got to rebuild
it. Whether you can rebuild it with this kind
of attitude remains to be seen. My late father
always said, you can only do business with a
man who wants to do business. And we'll have
to see whether the US wants to do business. A
last comment on the impact of the war, the Middle
East war? Well, I think it's extremely serious
and it's quite clear what it's doing to the world.
It'll be bad for everybody, also for South Africa.
And I think what the war also underscores is
the fact that power is shifting. Who would have
thought that a country like Iran, which is really
a middle size to small power, can exert the influence
that it does. So power is shifting and it's important
that we stay abreast of that. Thank you very
much. Thank you. And to our listeners, go well
until the next time. Thank you for listening
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