Large volumes of SA exports to the UK are still paying full duties — costing the economy billions — under a trade deal that should grant tariff-free access.
Figures at Wednesday’s department of trade, industry & competition and SA Chamber of Commerce and Industry seminar co-hosted with the British high commission underline the scale of the underutilisation.
The high commission showed that in 2024 alone, £114m (about R2.7bn) in vehicle exports to the UK paid the standard UK global tariff of 10%, rather than the 0% duty guaranteed under the Sacu member states and Mozambique (SACUM) and UK economic partnership agreement, SA’s post-Brexit trade deal with the UK.
A further £40m in white wine exports missed out on preferential access, as well as £18m in fruits and nuts, including £3m in avocados — a product that qualifies for duty-free access but still paid a 4% UK tariff.
While the UK is not certain why this is happening, officials there and at SA’s trade department said they were working to fix the problem.
The US’s 30% tariff wall has walloped SA, launching ministers into action to seek new markets and prompting warnings that the steep levy will lead to job losses. The full use of SACUM-UK economic partnership agreement could recoup hundreds of millions in lost savings, potentially helping to blunt the US sting.
Snapshot
South African exporters are losing billions in potential savings as large volumes of goods continue to pay full UK import duties, despite the SACUM-UK Economic Partnership Agreement guaranteeing tariff-free access.
In 2024 alone, £114m (R2.7bn) in vehicle exports and millions more in wine, fruit, and nuts paid standard UK tariffs. The issue stems from underutilisation of the deal, often due to unmet rules of origin and administrative barriers.
The UK is SA’s second-largest agricultural export partner and fourth-largest source of imports. The SACUM-UK economic partnership agreement is a duty-free and quota-free arrangement that allows most SA goods to enter the British market without tariffs provided they meet certain requirements, such as "rules of origin". These rules ensure that products are either made in SA or include a high enough proportion of inputs sourced from the SACUM region (which includes SA, Botswana, Eswatini, Lesotho, Namibia and Mozambique).
Emily Mphahlele, a director in the department’s trade branch, said it is actively engaged with industry and its UK counterparts to resolve these issues. She said the department is supporting wine exporters through legal and diplomatic channels, while technical matters are handled in co-ordination with agricultural authorities.
"We are fixing the problems provided the magnitude of those problems is within the scope of our relations," Mphahlele said. "If they [the barriers] are technical, we call colleagues from [the department of] agriculture to deal with the technical aspect, but the legal part, that’s where [the trade department] comes in," she said.
On the vehicle side, Mphahlele said it is pushing for "extended cumulation", a change that would allow SA car manufacturers to include a greater share of imported parts from outside the SACUM region and still qualify for duty-free access under the economic partnership agreement.
"The world has moved from the hybrid to electric vehicles. There are ongoing discussions with the UK and EU to ensure that our vehicle industry is ready to tap into that market. We are waiting for the UK to reflect on our proposal."
UK officials also said they are working to bridge gaps in the system. Natasha Stotesbury, head of trade policy at the British high commission in SA, used wine as an example, saying the UK is focused on improving utilisation in the wine sector through business-to-business support and greater transparency around barriers such as rules of origin.
"We’re very pleased that, as part of the [UK-SA trade partnerships] programme, a cohort of wine companies is being supported in particular," Stotesbury said. "This month, we’ll have a delegation of UK wine buyers flying out to be part of business-to-business meetings and attend Cape Town’s International Wine Festival. That’s one way in which we are trying to actually make the business-to-business linkages," she said.
"We’re really keen to understand if there’s an issue around, say, rules of origin; to get that proof right and ensure that where the export is happening, but tariffs are being paid, understanding why that’s happening, and if we can try to rectify it."
On the sidelines of the seminar, Mphahlele said SA was looking to the UK and EU to help offset the potential effect of the US’s 30% tariffs on SA.
The US has long been a key market for SA exports ranging from vehicles to wine, citrus, and fruit and nuts, much of it shipped under the duty-free terms of the African Growth and Opportunity Act. Citrus producers count the US among their top three global markets, while wine continues to make inroads with American consumers.
But the imposition of the steep tariffs — including a 25% section 232 duty on vehicles, combined with retaliatory duties of up to 55% — has thrown this trade relationship into turmoil.
"There’s a team of colleagues that are working towards having alternative markets," Mphahlele said, adding that they are also in discussions "with the UK in particular".
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