South Africa is working to reset US relations that have been under assault by Donald Trump since his return to the White House.

Pretoria is preparing a bilateral trade agreement as a backstop in case it loses access to a preferential accord, according to the deputy trade minister. And it’s shoring up its diplomatic presence in Washington following the expulsion of the country’s ambassador this month.

As part of the multi-pronged strategy, a South African business delegation also visited New York this week for talks with some of the 600 US companies who operate in the country on how to prepare for the potential loss of duty-free access.

Ties between the two nations have been battered by a cascade of actions by the US president. Trump’s objections include South Africa’s genocide case against Israel at the International Court of Justice and claims of land seizure at the expense of white farmers. South Africa hasn’t confiscated any land since the end of apartheid in 1994.

While the rand has been jolted intermittently by Trump’s outbursts — most recently on 7 March — the currency has so far weathered the stormy relations, gaining 3.2% against the dollar so far this year.

“One would have expected the rand to have blown out already, given the diplomatic fallout between South Africa and US, but it has been surprisingly stable,” said Reezwana Sumad, senior research analyst at Johannesburg-based lender Nedbank. “But what we’ve also seen is that the whole majority of the emerging market FX universe has also been stable. Sharp dollar weakness has supported emerging market currencies. The rand is also benefiting from that.”

Important role

Still, US investors play an important role in funding South Africa’s current account deficit and any US investment restrictions, should relations deteriorate further, would trigger a major financial shock, Deutsche Bank said in a note last month.

South Africa must “find a new equilibrium between the tensions that will likely continue to exist over domestic policy that the Trump administration has repeatedly criticised, and the business relationships and trade ties that would be negatively affected by a complete breakdown”, said political analyst Ziyanda Stuurman.

The air between Washington and Pretoria was already chilly before Trump’s return to power, with the US critical of South Africa’s non-aligned stance on Russia’s invasion of Ukraine.

Read: EU risks Trump backlash as it warns Apple, Google of big fines

Since Trump was sworn back into office on 20 January, he’s halted US aid to South Africa and his secretaries of treasury and state have both snubbed G20 meetings, which the country is hosting this year.

Among the measures being considered by Pretoria are a new trade deal to present to the US in anticipation of the country’s duty-free access under the African Growth & Opportunities Act, known as Agoa, being revoked.

Thousands of South African goods enter the US duty free under Agoa and the so-called Generalised System of Preferences, America’s oldest and largest trade-preference programme for the world’s poorest economies.

The department of trade, industry & competition is working to secure continued preferential access, while preparing a bilateral agreement that would be used in event that it’s revoked, said deputy trade minister Andrew Whitfiled.

“A key part of our effort is to work together with business to achieve the most favourable outcome possible,” he said by text message. “There are more than 600 US companies invested in South Africa and we are confident that we can maintain strong trade and investment relations with them.”

Trade ties with the US remain a strategic priority, presidency spokesman Vincent Magwenya said by text message. America is South Africa’s biggest individual trade partner after China, with goods worth US$14-billion shipped to the US in 2023 and imports totalling $9.75-billion.

“The trade proposal we are formulating is in anticipation of either the scrapping of Agoa entirely or the termination of South Africa’s participation,” Magwenya said. “The current diplomatic tensions have not impacted our bilateral trade.”

South African foreign ministry officials are also in the US this week for G20 meetings, and are using the occasion to meet with their US counterparts. Among other plans being considered is the deployment of a white Afrikaner as ambassador to replace Ebrahim Rasool, who was declared persona non grata by the US on 14 March.

Starlink

That approach may serve to counter the false narrative within the Trump administration — amplified by his South African-born billionaire ally Elon Musk — that the ethnic group is being persecuted by the government.

Musk has sought approval to expand his Starlink in the country, but has objected to its legislation that seeks to boost black participation in the economy, accusing the government of having “openly racist ownership laws”.

“Elon Musk falsely believes that ‘white genocide’ is being perpetrated here in South Africa,” Magwenya said. “Perhaps he has lost the appetite to have any business exposure here. Otherwise, how will his team be able to operate here if one follows his logic.”

Read: Elon Musk: Starlink ‘not allowed’ in South Africa ‘because I’m not black’

Among people being considered for the ambassador role are deputy justice minister Andries Nel and former tourism minister Martinus van Schalkwyk, according to people familiar with the matter. Another vacancy in the US is the position of consul-general in Los Angeles, for which former South African ambassador to Ireland Melanie Verwoerd is being considered, said the people who asked not to be identified because the discussions are private.

The names are among candidates that may be recommended to Ramaphosa in the coming weeks, though he may select his own candidate for the job, the people said. The appointment of the new ambassador may take months, as Ramaphosa continues to assess the situation in the US, they said.

Earlier this week, the Trump administration nominated Leo Brent Bozell III, a conservative activist and writer, to be the country’s ambassador to South Africa.

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