President Cyril Ramaphosa said the outcome of the US midterm elections signals a shift in the geopolitical landscape that could open the way for a reset in Pretoria’s strained ties with Washington.
America’s Democratic Party swept both chambers of Congress in Tuesday’s vote in an election landslide that amounted to a rejection of President Donald Trump’s policies.
The rand was among the best-performing currencies in the world tracked by Bloomberg on Wednesday, rising around 1% against the US unit to 16.46 per dollar.
“I do think that this is going to introduce a new era in world relations,” Ramaphosa said as he cast his vote in municipal elections in Johannesburg.
“We’re hoping that, on a bilateral basis, there will be a coming together of minds, where we will find a proper path forward on geopolitics as well as on trade matters and investment matters.”
South Africa’s relations with the US have deteriorated since Trump returned to the White House last year.
He quickly froze US assistance to South Africa, falsely claiming the government is allowing a genocide of White Afrikaner farmers.
Trump has also criticised the country’s Black economic-empowerment laws, which were introduced to address inequalities created by apartheid.
Earlier this week, the US announced plans to revoke South Africa’s access to a duty-free trade pact under the African Growth and Opportunity Act. US Trade Representative Ambassador Jamieson Greer said the decision was taken because of unspecified “concerning and pervasive practices” that he said undermine American trade and investment, and pose a threat to US national security.
America ranks as South Africa’s third-biggest trading partner, after China and the European Union.
Bilateral trade between South Africa and the US last year was $24.1 billion — less than half the $55.6 billion of commerce with China, according to data compiled by Bloomberg.
“Exclusion from Agoa is indeed a negative for us,” Ramaphosa said in remarks broadcast on Johannesburg-based eNCA.
Still, South Africa’s trade relations with the US don’t only centre on the duty-free pact, the president said. Agoa exports account for about 10% of total shipments to America, according to South African government data.
“We also have trade dealings with the US on a variety of products, which are outside Agoa,” Ramaphosa said. “Our trade relations with the US continue, and we want it to get even better through bilateral dealings.”
BLOOMBERG
