Star 2025-04-08

Rand plunges to two-year low by 1.6% to R19.44 against the dollar, its lowest since May 2023 The fallout from escalating US import tariffs reverberated across global markets on Monday as fears of trade tensions between the United States and China grew, with South Africa's economy bearing the brunt of the turmoil exacerbated by domestic political uncertainty. The rand plunged to a near two-year low by 1.6% to R19.44 against the US dollar during early trade on Monday, its lowest level since 26 May 2023 when it hit R19.65/$1, worsened by the uncertainty over the future of the Government of National Unity (GNU). The rand also hit R25 to the British pound in early morning trade on Monday - the worst level ever against the pound. Financial markets remained on…

In a massive diplomatic push, economic advisors of US President Donald Trump, have said that 50 countries have come forward to negotiate for better tariffs from the country. This comes after Trump announced sweeping tariffs across the board last week that brought the global economy to its knees, with markets crashing to lows that had economists and analysts alike, fearing for a global recession. Countries are keen on restructuring these financial barriers to foster co-operative trade relationships that could bolster their economies while alleviating the strains of recent trade disputes. These tariffs have not only altered the landscape of international commerce but have also triggered retaliatory measures from some nations, further complicating global trade relations. With inflation rates and economic recoveries at the forefront of global policies, the need for…

The African Union said on Monday that US tariffs imposed on countries across the continent threatened decades of "mutually beneficial trade and cooperation". AU Commission chairman Mahamoud Ali Youssouf expressed deep concern over the tariffs and urged the US government to reconsider, an AU spokesman said. Youssouf "calls on the US to strengthen, rather than strain, the longstanding partnership rooted in shared values and mutual aspirations," said spokesperson Nuur Mohamud Sheek. Some African countries have been hit harder by tariffs - ranging from 50% for the small African kingdom of Lesotho, a major textile exporter, to 30% and above for South Africa, Madagascar and Botswana. About 30 sub-Saharan African countries benefit from duty-free access to the US market through the African Growth and Opportunity Act (Agoa), an agreement whose future…

Cryptocurrencies wiped out almost all their gains since Donald Trump’s election win in early November as fallout from the US president’s tariff onslaught sparked heavy selling in an asset class he’s vowed to champion. Bitcoin briefly tumbled below $75 000 (R1.4 million) on Monday for the first time since November 7, dropping as much as 5.3% before recovering slightly. Smaller tokens remained subdued, however, with XRP, Solana and Cardano all trading down between 5% and 10% as of 8.57 am in New York. Ether traded at its lowest since March 2023. The total market capitalisation of all cryptocurrencies fell about 11% to $2.5 trillion, roughly where it stood when Trump sealed his victory, according to CoinGecko data. The slide comes as Trump dug in on sweeping tariffs that have already…

Last week saw South Africa’s Parliament approve a phased increase in VAT, sparking debates about its impact on the economy. Meanwhile, the ongoing trade conflict with the US intensified as President Trump imposed new tariffs, leading to fears of a global economic slowdown. Trump’s sweeping tariffs have ignited trade wars, causing market turmoil and uncertainty. As Peter Drucker once noted, “The best way to predict the future is to create it,” and South Africa must navigate these turbulent waters with resilience and strategic foresight. I was encouraged to see a statement by ministers Ronald Lamola and Parks Tau largely agree that the best way forward is to work hard to improve relations with the US but also enhance the focus both on stimulating domestic growth and improving our trade relations…

The hostile disposition of the US’ President Donald Trump towards South Africa raises serious concerns about the possible exclusion of South Africa as a beneficiary of the African Growth and Opportunity Act (Agoa), which is set for renewal in 2025. With South Africa consistently ranking as the top Agoa user, as well as the number one African agricultural exporter under Agoa, we look at the possible ramifications for agriculture. A law implemented in 2000 by the US, Agoa, establishes a unilateral trade preference programme, allowing certain exports from South Africa and many other eligible sub-Saharan African countries to enter the US market, duty-free. Under Agoa, two-thirds of South Africa’s agricultural exports to the US benefit from tariff-free treatment. Since its inception, South Africa has exported over $7 billion (R25bn) worth…