South Africa is actively strengthening its international trade and industrial development agenda through strategic engagements with global partners. In its efforts to maintain access to U.S. markets under the Africa Growth and Opportunity Act (AGOA), the country submitted a Framework Deal in May 2025 and signed a condition precedent document with the U.S. Trade Representative.
According to Minister of Trade, Industry and Competition, Parks Tau, this marks a critical step in advancing bilateral trade talks. He emphasized the role of collective engagement particularly by business, organized labor, and civil society in influencing U.S. Congress to preserve South Africa’s AGOA status and address the concerns raised in the U.S.-South Africa Bilateral Relations Review Act.
Parallel to its Western engagements, South Africa continues to deepen its trade relationships in Asia. Ongoing discussions with China focus on green industrialisation, improving industrial supply chains, and enhancing the domestic processing of critical minerals. These efforts are closely tied to South Africa’s broader reindustrialisation strategy, particularly within Special Economic Zones (SEZs) and Industrial Parks. Additionally, South Africa is renewing its investment collaboration with Japan through the Japan External Trade Organisation (JETRO) and InvestSA, aiming to attract more strategic investment and industrial growth.
Carbon Border Adjustment Mechanism
Minister Tau also raised concerns about the impact of the European Union’s Carbon Border Adjustment Mechanism (CBAM), warning it could lead to a 1% reduction in Africa’s GDP. In response, South Africa is advocating for the protection of a fair, multilateral trading system based on principles upheld by the World Trade Organization (WTO) and the United Nations. This message will form a core part of South Africa’s position at the 14th WTO Ministerial Conference scheduled to take place in Cameroon next year.
Furthering its decarbonisation agenda, South Africa welcomed the Clean Trade and Investment Partnership (CTIP) announced with the European Union in March 2025. The agreement is expected to benefit local governments and provinces by supporting climate goals and unlocking R90 billion in initial funding for clean investment facilitation.
On the domestic front, the Industrial Development Corporation (IDC) has revised its financial commitments for the 2025/2026 period, earmarking R12 billion (approximately $779 million) to support economic transformation. This includes targeted funding of R7.4 billion for black industrialists, R3.5 billion for women-owned businesses, and R1.5 billion for youth-led enterprises. Deputy Minister Zuko Godlimpi highlighted key regional initiatives such as support for small-scale sugarcane growers in KwaZulu-Natal, funding for black grain producers in the North West province, and green hydrogen development in the Eastern Cape.
The Department of Trade, Industry and Competition (DTIC) allocated a total budget of R11 billion ($714 million) for 2025/2026. Of this, business incentives represent the largest portion 35.15% marking an increase from the previous year’s R9.6 billion allocation. Infrastructure funding constitutes 10.2% of the budget, with R5.2 billion supporting key incentive programmes to stimulate investment and industrial development across the country.