COSATU calls for urgent government intervention after SA’s AGOA removal

COSATU calls for urgent government intervention after SA’s AGOA removal, warning that the decision by the United States to end South Africa’s participation in the African Growth and Opportunity Act (AGOA) could place jobs, exporters and key economic sectors under increasing pressure.

The Congress of South African Trade Unions (COSATU) has called on the government to urgently address the implications of South Africa losing its preferential trade access to the US market from January 2027.

Although South African businesses will still be able to export goods to the United States, the federation says the removal from AGOA means exporters will lose duty-free benefits and face additional costs when trading with American customers.

COSATU Parliamentary Coordinator Matthew Parks has expressed particular concern about the potential impact on workers, farmers and businesses that rely heavily on exports to the United States.

The development has renewed concerns about employment, economic stability and the future competitiveness of South African products in one of the country’s important international markets.

COSATU warns of AGOA consequences for South African exporters

COSATU says the termination of South Africa’s participation in AGOA could have serious consequences for exporters who have benefited from preferential access to the American market.

The trade programme was designed to provide eligible African countries with duty-free access for thousands of products entering the United States, helping businesses remain competitive and supporting economic growth.

According to Parks, the loss of these benefits could make South African products more expensive for American consumers and businesses.

Exporters face increased costs under new tariffs

Parks explained that South African exporters would continue trading with the United States despite the removal from AGOA.

However, businesses would lose the approximately 3.5% preferential tariff reduction associated with the programme, meaning that their products could become more expensive for customers in the US market.

This change could place additional pressure on exporters already dealing with fluctuating trade policies, rising operational costs and uncertainty in international markets.

COSATU believes government intervention is necessary to help affected industries adapt to the changing trade environment and protect workers whose livelihoods depend on exports.

Agricultural sector faces potential job losses

One of COSATU’s biggest concerns is the possible impact on South Africa’s agricultural sector, particularly farmers exporting citrus and other agricultural products to the United States.

Parks highlighted the Western Cape, Limpopo and Northern Cape as provinces where agricultural workers and businesses could be affected by changes in trade conditions.

Citrus farmers and agricultural exporters under pressure

South Africa’s agricultural exports play an important role in supporting rural economies, creating employment and sustaining businesses throughout the supply chain.

Citrus farming, in particular, depends on access to international markets where South African produce competes with products from other exporting countries.

Higher tariffs could affect the competitiveness of South African products, potentially placing pressure on exporters to absorb additional costs or reconsider their pricing strategies.

COSATU says the potential consequences extend beyond farmers and exporters to workers employed in farming, packing, transportation, logistics and related industries.

COSATU concerned about employment security

Parks warned that job losses had already occurred during the previous period of uncertainty surrounding changes in US tariffs.

He said the federation was concerned that further instability could threaten employment, especially in sectors that depend on consistent access to international markets.

The union movement has consistently argued that trade policy decisions should consider their impact on workers and communities, rather than focusing only on business and economic figures.

COSATU is therefore urging government to take steps to protect employment and support industries that could experience difficulties following the AGOA decision.

Government intervention needed to protect jobs

COSATU’s call for urgent government intervention comes amid growing concerns about South Africa’s trade relationship with the United States.

The federation believes government must engage with relevant stakeholders to identify practical solutions that can reduce the impact of losing preferential trade benefits.

Strengthening trade relations with the United States

Maintaining stable trade relations with the US remains important for South African businesses operating in sectors such as agriculture, manufacturing and other export-driven industries.

Government engagement could help address concerns about tariffs, improve communication with American authorities and explore opportunities to maintain market access for local exporters.

COSATU’s position reflects the need for a coordinated approach involving government departments, business organisations, labour representatives and affected industries.

Supporting affected exporters and businesses

The federation’s concerns also highlight the importance of providing support to exporters who may face increased costs or reduced competitiveness.

Possible responses could include strengthening alternative export markets, improving local production efficiency and supporting businesses in adapting to changing international trade conditions.

However, any measures introduced would need to consider the financial and operational realities facing businesses, particularly smaller exporters and agricultural enterprises.

The government will also need to consider how trade-related challenges could affect workers and communities that depend on export-driven industries for employment.

South Africa’s AGOA removal raises wider economic concerns

South Africa’s removal from AGOA has raised questions about the country’s future trade relationship with the United States and the potential consequences for businesses operating across international markets.

While exporters can continue selling goods to American customers, the loss of preferential access could affect the competitiveness of certain products.

Trade uncertainty and economic stability

Changes in tariffs and international trade arrangements can create uncertainty for businesses that rely on long-term contracts, investment decisions and predictable export conditions.

Exporters may need to reassess pricing, supply agreements and production costs to remain competitive.

For workers, uncertainty in export markets can translate into concerns about job security, reduced working hours or possible retrenchments if businesses experience declining demand.

COSATU has therefore emphasised the need for government to act quickly to prevent the trade development from worsening existing employment pressures.

COSATU calls for a balanced response to AGOA removal

Although the federation has expressed serious concerns, Parks also cautioned against creating unnecessary alarm over the decision.

He stressed that South African companies would not be prohibited from exporting to the United States.

Instead, the primary concern is the loss of preferential tariff treatment, which could make products approximately 3.5% more expensive for American customers.

This distinction is important for businesses assessing the impact of the decision and considering how to respond.

COSATU’s position is that government must nevertheless take the development seriously because even relatively small increases in costs can affect competitiveness, particularly in sectors operating on tight margins.

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Conclusion

COSATU calls for urgent government intervention after SA’s AGOA removal as concerns grow about the potential impact on exporters, agricultural businesses and workers.

The federation has warned that the loss of preferential trade benefits could increase costs for South African products entering the US market and place employment under pressure.

While exports to the United States will continue, COSATU believes government must urgently engage with stakeholders, support affected industries and explore measures to protect jobs.

As South Africa prepares for the changes taking effect in January 2027, the response from government and industry will be critical in determining how exporters adapt to the new trade environment.

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References from mainstream media

• SABC News: “COSATU calls for urgent govt intervention after SA removal from AGOA” (Covers COSATU Parliamentary Coordinator Matthew Parks’ concerns regarding the impact on agricultural jobs and the 3.5% tariff increase for US customers) – https://www.sabcnews.com/sabcnews/cosatu-calls-on-govt-to-intervene-after-us-ejected-sa-from-agoa/

• Channel Africa: “COSATU urges government action over SA’s removal from AGOA” (Highlights the federation’s specific concerns for the Western Cape, Limpopo, and Northern Cape citrus farmers who rely on duty-free access) – https://www.channelafrica.co.za/channelafrica/news/cosatu-urges-government-action-over-sas-removal-from-agoa/

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