The 30% tariff on exports to the US from August 1 is the kind of policy threat that should have everyone in our economic system on high alert.
But behind the diplomatic skirmish is a more important question: what kind of investment partnerships are we building to protect the businesses that hold our economy together when global shocks hit? Because right now, they are not strong enough.
We’re often told the biggest challenge for SA businesses is access to capital. That’s only half true. There is capital available — in pension funds, direct foreign investment pipelines and blended finance instruments. What’s missing is a model of partnership that understands how power, trust and relevance actually work when the stakes are high and the markets are uneven.
We need to stop thinking of capital markets as neutral delivery systems. They are not. They are shaped by who designs the deals, who sets the thresholds, who gets heard, and who gets paid first. And right now that system isn’t working for the people trying to build viable businesses in a fragile and complex environment.
In too many transactions the terms are set offshore and shaped by international development institutions, global advisory firms, or donors looking to derisk their participation. Local investors are invited in at the tail end, expected to endorse a structure that was never designed with their priorities in mind. Meanwhile, domestic firms are asked to reshape their operations to fit the capital, rather than the capital adapting to support the real challenges those businesses face.
Many of the investments currently offered in the name of resilience or development fail to solve the actual problems SA firms are dealing with.
That’s backwards. If we want investment partnerships to work, especially in moments of volatility like the one we’re entering now, we need to reverse this process. Let local stakeholders, including asset managers and business operators, shape the instrument from day one. Let them define what success looks like. Let them own the risk.
Many of the investments currently offered in the name of resilience or development fail to solve the actual problems SA firms are dealing with. They may be aligned to international environmental, social & governance (ESG) frameworks, or promote admirable goals on paper, but they don’t address the acute realities of operating in this context. Right now, those realities include tariff exposure, delayed payments, commodity price swings, energy uncertainty and fluctuating cost of capital.
For many firms these are existential risks. Tariffs could cause severe disruption in sectors like citrus, aluminium and automotive, threatening jobs and earnings in some of SA’s most export-reliant industries. So the question becomes: where are the investment vehicles that actually protect them?
Imagine a bond issued on the JSE that combines risk-sharing mechanisms, tariff mitigation and working capital buffers specifically designed to help exporters absorb external shocks.
Imagine that bond being co-designed by local asset managers, rated by institutions with experience in regional volatility, and carried forward by domestic pension funds after international seed capital exits. That is the kind of innovation we need — not just for ESG headlines, but for market stability and commercial legitimacy.
Trust gap
There’s also a trust gap between capital markets and communities. If a deal is successful on paper but invisible to the people it claims to support, it creates resentment, not resilience. People trust what they can see: infrastructure improved, jobs protected, new opportunities unlocked in sectors that matter. If we want to build public confidence in the value of capital markets, we have to connect capital to consequence in ways that are measurable, visible and enduring.
This is also where most donor-driven deals fall down. Too many lack any clear plan for continuity. When the initial funder leaves, there is often no pathway for domestic capital to take over. No clarity on who maintains the trust, who holds the accountability or who carries the work forward. A good investment model is one that gets stronger over time, not more fragile once the donor steps back.
SA doesn’t lack ambition. Nor does it lack capital. What we lack is a system that lets businesses, communities, asset managers and institutions build together on fair terms, with clear purpose and with a model of ownership that evolves over time.
The Trump tariffs may not land. But the structural weakness they expose — our fragmented, misaligned approach to partnership and capital design — is real. And unless we fix that architecture, no amount of funding will deliver the outcomes we say we care about.
We don’t need more capital. We need better deal-making. That means partnerships grounded in relevance, shaped by those closest to the risk, and designed to endure.
The next crisis is already on its way. What matters is whether our systems are ready for it, or whether they fall back into the same patterns that left us exposed the last time.
• Polley is managing partner and senior emerging markets adviser at Instinctif Partners.
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