Economist and futurist Prof André Roux shares his perspective on how Trump’s presidency may influence South Africa and its trade relations.
With President-elect Donald Trump’s recent electoral victory as the 47th President of the United States of America (USA), concerns and questions arise on the global economic impact, particularly on Africa. Following the announcement of Trump's re-election, Prof Andre Roux, a respected economist and futurist at the Stellenbosch Business School, provided his perspective on how Trump’s presidency may influence South Africa and its trade relations.
Potential economic impact on South Africa
Prof Roux emphasised that Trump's focus on protecting the US economy could have dire ramifications beyond American borders. Trump's “America First” stance is expected to bring increased tariffs on imports, impacting South African exports, especially if the USA revisits or reshapes agreements like the African Growth and Opportunity Act (AGOA), which supports trade with African nations.
Roux expressed concerns that; "Trump's victory probably does not bode well for Africa, South Africa, or the developing world at large, given Trump's history of prioritising domestic economic concerns over international partnerships, especially with Africa."
With Trump’s preference for a protectionist trade policy, Professor Roux warned of collateral impacts on South Africa, both positive and negative. For instance, while the shift might lead to a resurgence of USA domestic manufacturing, it may reduce demand for some African exports.
Global trade dynamics and the BRICS factor
This Trump presidency could further complicate relations between the USA and China, a significant trading partner for African nations. If Trump escalates trade tensions with China, it may affect African economies that rely on Chinese trade and investment.
"Relationships between China and America will probably be more troubled and any major disruptions could reverberate across Africa’s trade channels.”
Environmental policy and long-term concerns for Africa
Prof Roux pointed out that Trump’s stance on climate change, which often leans toward scepticism, is likely to impact long-term environmental goals.
"The fact that Donald Trump seems to be less enthusiastic about climate control and climate mitigation, is not very positive for the world at large, especially for Africa. With Africa already facing significant climate challenges, reduced USA engagement in global climate initiatives could hinder progress on climate resilience efforts across the continent."
A shift in global investment trends
Despite these challenges, Prof Roux highlighted that markets might view Trump’s leadership as favourable for investment in the USA, potentially to the detriment of gold and emerging markets. America’s renewed appeal as an investment destination may encourage capital inflows, reinforcing the dollar while potentially drawing investment away from other regions.
As the world adjusts to a second Trump leadership, African economies - including South Africa - may find themselves navigating new economic challenges and adapting to shifts in global alliances.