Tariffs threaten Eastern Cape manufacturing, but something can be done

The announcement by US President Donald Trump that South African goods will be subject to 30% import tariffs from 1 August is the latest addition to the clamour of alarm bells about the viability of manufacturing in the Eastern Cape, potentially putting thousands of jobs at risk.

- Denise van Huyssteen

The reality is that a number of countries will now have significant cost advantages over South Africa. In addition, this will strengthen countries with lower tariffs that we did not compete with in the past. And if imports from South Africa are replaced with products made by new US manufacturers, there will be an oversupply of these products in the global marketplace.

Analysis by the Nelson Mandela Bay Business Chamber indicates that thousands of direct and indirect jobs in manufacturing in the Eastern Cape are at risk from the impacts of the new US tariffs. This is in terms of reduced competitiveness and economies of scale of South African manufacturing against more favourable locations worldwide, as well as the knock-on effects on other trading relationships and the responses of other countries in an escalating tariff war.

Such job losses will have a vast socioeconomic impact, given that each employed breadwinner supports an estimated 10 other people in families and communities.