In a week in which SA’s finance minister stood up for the third time to try tabling a budget, it is most extraordinary that the story of the country’s finances is not the primary focus area absorbing all the attention. Rather, the nation’s attention will be split between the budget and a meeting in Washington involving presidents Donald Trump and Cyril Ramaphosa.
SA has been finding itself at the epicentre of shifts in the US administration since January that have the singular mission of rewriting the script of global trade, diplomacy and the way the world has marched towards globalism and multilateralism since the end of World War 2. After the war, the US emerged as the de facto leader in the global economy and the central player and host to many multilateral agencies and institutions created to guide the world towards convergence rather than perpetual conflicts.
The location of these institutions within the US borders and the prevalence of written and unwritten pacts that ensure American interests and preferences take pride of place in the way these institutions are managed and governed, created dependencies on the US that are now proving to be a fatal weakness for such institutions. When the World Health Organisation found itself out of favour with Trump at the height of its most demanding crisis of Covid-19, it exposed long-standing fragilities in its financial model. Alliances such as Nato similarly had to revisit their models in light of the end of long-term assurances on US support.
In the second Trump administration, the dependency crisis has hit state and nonstate actors through the tariff war and the wholesale shutdown of aid programmes such as USAID. For SA, the Trump guillotine has hit on all fronts. The cancellation of aid hit many nonstate actors running critical programmes — particularly in healthcare and research — which so far, have yet to find alternatives to close the gap. According to those at the front line of the cuts, in the absence of immediate solutions, the progress made over many years is at risk of serious reversal.
On the economic front, the sweeping tariff war has not only killed off the long-standing tariff concessions under the African Growth and Opportunity Act but it has also exposed SA companies to new tariff rates that make the possibility of maintaining trade volumes with the US market dependent on many unpredictable factors, including the US consumer market’s ability to absorb tariffs.
While these developments form part of the general Trump approach to the rest of the world and all alliances, it is in the specific focus on SA where neither common sense nor logic seem to be at play, but the consequences are dire. In issuing an executive order indicating the intention of the US government to intervene in the fate of white farmers apparently under siege, Trump has relied on a blend of fiction and right-wing propaganda to form the view that the SA government is incapable of managing the nation’s affairs and hence US intervention is required.
While this is different to the intervention approach of modern US governments, who unleash their armies on foreign territories, the idea that Afrikaners were subject to a genocide was damaging enough for Ramaphosa to undertake the trip to meet Trump directly. Success in the mission will mean that the possibility of containing the fallout on the economic and aid front exists. Anything less than that will mean that the budget will need to find some rand and cents to cover the gap created by the bigger diplomatic fallout.
• Sithole is an accountant, academic and activist.
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