Western Cape Government Assessing Impact of AGOA Notification on Jobs & Growth
Joint Media Release by Alan Winde, Premier of the Western Cape and Western Cape Minister of Agriculture, Economic Development and Tourism Dr Ivan Meyer
The Western Cape Government and its official tourism, trade and investment promotion agency, Wesgro are in the process of assessing the impact of South Africa’s removal from the Africa Growth and Opportunity Act (AGOA) on jobs and growth in the province. This follows last night’s notification by United States of America of its intention to remove South Africa from AGOA, effective from 1 January 2027.
By providing duty free access for certain goods to the USA, AGOA has been an important trade instrument for the Western Cape and South Africa. For years it has benefitted the Western Cape’s economy, particularly the region’s job-creating agriculture sector. The Western Cape accounted for over 50% of South Africa’s total agriculture and agri-processing goods to the United States in 2025.
The USA is the province’s number one source of foreign direct investment, a key market for Western Cape exports, as well as the province’s second largest tourist source market, supporting tens of thousands of jobs.
This decision is expected to have varying impacts across sectors and product lines. While certain businesses may be able to absorb the additional tariff on their exports, we should not underestimate the impact this will have on businesses struggling under the current economic climate that may now lose their competitive advantage in the US market.
Premier Winde stated, “We appreciate the gravity of this move and the concerns of stakeholders, especially in the agricultural and agri-processing sector. The Western Cape’s economy will no doubt feel the impact of not having AGOA preferences in the US market. The notification by the US government is deeply unfortunate, however, it was not unexpected.”
While AGOA benefits many Western Cape exporters, with half of the province’s top ten export products qualifying, it is important to note that our trade relationship with the US extends well beyond AGOA and is underpinned by broader commercial and investment ties.
Industry insights and tariff analysis conducted by Wesgro indicated that AGOA preferences significantly benefited yachts, certain engine parts, citrus, wine, and fruit juices. However, these benefits have since been undermined by repeated tariff actions, including up to 30% tariffs last year, and the current 12.5% tariff under S 301 of the US Trade Act.
The Western Cape Government had been working incredibly hard to advocate for the maintenance of mutually beneficial relations, the expansion of product line tariff exemptions, and put forward our case as to why South Africa should not be removed from AGOA.
“While respecting that international trade negotiations remain the mandate of national government, I wish to encourage further engagement in the interest of protecting jobs and growth. With already unacceptably high levels of unemployment in our country, we must double-down our efforts to break the diplomatic deadlock, protect existing jobs and drive greater investment to create more employment opportunities for our residents,” said Premier Winde.
Premier Winde will also seek a meeting with the Minister of Trade, Industry and Competition, Parks Tau, to offer his support and contribute in any meaningful way to ongoing efforts.
“This notification also reinforces the importance of building a more diversified, resilient export base to reach our target of becoming a R1 trillion provincial economy and tripling our exports by 2035; particularly as access to individual markets can be affected by factors beyond our control,” said Western Cape Minister of Agriculture, Economic Development and Tourism Dr Ivan Meyer.
The Western Cape Government is intensifying its export promotion and reducing reliance on any single market, with the launch and initiation of the Western Cape Export Strategy in July 2026. Through Wesgro and the Western Cape Departments of Agriculture and Economic Development and Tourism, the Province is advancing market diversification support, Africa and Asia-focused market activations, exporter competitiveness support, international buyer matchmaking, #MadeInTheCape retail partnerships and measures to address trade barriers and improve logistics.
These efforts are starting to produce some early results in affected industries. While our data shows that provincial citrus exports to the US declined by 10,300 tonnes (or -8%) between August 2025 – July 2026 compared with the preceding 12 months, exports into the rest of Africa increased by 17,800 tonnes over the same period (or 40%), while citrus into Asia increased by 111,000 tonnes (or 21%), also over the same period. The growth in the quantity of citrus exported globally over the period since tariffs took effect was 33 times more than that lost to the US market; indicating early payoffs in market diversification efforts.
“We must intensify our efforts to diversify our province’s export markets. This, however, will take time and must be accompanied by continued efforts to strengthen SA-US trade relations,” concluded Premier Winde.
