MARKETS | U.S.-AFRICA RELATIONS
The Trump administration is moving to terminate Rwanda and South Africa’s participation in the African Growth and Opportunity Act, adding a new economic dimension to Washington’s increasingly strained relations with two of Africa’s prominent investment destinations and regional business gateways.
U.S. Trade Representative Jamieson Greer said President Donald Trump has notified Congress and the governments of both countries of his intention to end their participation in the trade preference program effective January 1, 2027.
The announcement follows a series of increasingly confrontational actions by Washington against both governments, including new Treasury sanctions against Rwanda over its alleged support for M23 rebels in eastern Democratic Republic of Congo and restrictions targeting South African officials over the Trump administration’s claims of discrimination against white Afrikaners.
Greer said the decision followed an annual interagency review of sub-Saharan African countries’ eligibility for AGOA.
“Based on the review, President Trump found that the governments of Rwanda and South Africa are engaging in practices that are inconsistent with AGOA’s eligibility criteria,” Greer said in a statement Monday.
He cited what he described as “concerning and pervasive practices,” including barriers that undermine American trade and investment and actions that pose threats to U.S. national security and foreign policy interests in the region.
The administration said it is working to ensure that its African partners take the necessary steps to meet the program’s eligibility requirements.
The announcement comes less than a week after the U.S. Treasury Department imposed sanctions on Rwanda’s Ministry of Defence and Zigama Credit and Savings Society, a financial institution serving Rwanda’s security services, over alleged support for the M23 armed group. The October 28 sanctions are part of the Trump Administration’s effort to pressure Kigali to meet its commitments under the U.S.-brokered Washington Accords for Peace and Prosperity between Rwanda and DRC, signed by the presidents of Rwanda and the DRC in December 2025.
The agreement, which was meant to end the conflict in eastern Congo and establish a framework for regional trade, investment, and cooperation, including greater transparency in critical-minerals supply chains, has faced hurdles in being implemented, with both countries pointing the finger at each other for failing to abide by the rules.
Washington accused Rwanda’s military of providing troops, weapons, logistics and training to M23, which has seized territory in mineral-rich eastern Congo. The Treasury also accused Zigama of facilitating financial transactions supporting the armed group.
Treasury Secretary Scott Bessent said the sanctions were intended to hold Rwanda accountable for its commitments under the agreement, calling on Kigali to end its support for M23 and withdraw its troops from eastern Congo.
Rwanda has denied supporting armed groups and maintains that it is prepared to implement the Washington Accords.
South Africa’s confrontation with Washington has followed a different course.
The Trump administration has accused Pretoria of pursuing policies that discriminate against white South Africans, particularly Afrikaners, through land reform, affirmative action and other measures. Trump issued an executive order in February 2025 directing U.S. agencies to halt assistance to South Africa and prioritizing refugee resettlement in the U.S. for Afrikaners.
In September, Secretary of State Marco Rubio announced a visa restriction policy targeting foreign nationals accused of being responsible for or complicit in race-based discrimination, uncompensated land seizures, and incitement of violence against minority groups in South Africa.
The South African government has rejected Washington’s allegations, arguing that its land and affirmative-action policies are intended to address inequalities rooted in colonialism and apartheid.
The latest AGOA decision adds trade pressure to an already deteriorating relationship, with significant implications beyond the diplomatic dispute.
South Africa and Rwanda occupy distinct but important positions in Africa’s economic landscape.
South Africa is the continent’s largest industrial economy and a major destination for foreign investment, with established manufacturing, financial services, mining, and automotive industries. It is also an important gateway for companies seeking access to markets across Southern Africa.
Rwanda, meanwhile, has built an international profile as an investment and business destination, positioning Kigali as a regional hub for finance, tourism, technology and services.
The country’s transformation has been particularly significant given its history. The 1994 genocide against the Tutsi killed an estimated 800,000 people and devastated the country’s institutions and economy. In the decades since, Rwanda has rebuilt its economy, attracted investment and developed a reputation for its business environment and infrastructure.
South Africa’s emergence from apartheid similarly reshaped its political and economic trajectory, although the country continues to grapple with deep structural inequalities inherited from its history.
Their potential removal from AGOA could be consequential for trade, investment and the wider U.S.-Africa commercial relationship.
Enacted in 2000, AGOA provides eligible sub-Saharan African countries with duty-free access to the U.S. market for thousands of products. South Africa has been the program’s largest beneficiary, exporting approximately $1.7 billion in goods under AGOA in 2025, including automobiles and components, citrus and wine.
Rwanda’s key exports to the U.S, include coffee and minerals, while the country has also sought to expand its role in regional trade and investment.
While the administration’s decision does not preclude either country from regaining eligibility if it addresses Washington’s concerns and meets the program’s requirements, however with the proposed January 2027 termination date approaching, the announcement raises fresh questions about the future of U.S. trade engagement with two countries that have become important players in Africa’s investment and commercial landscape.
the administration identified trade and investment barriers, concerns over the rule of law, political pluralism, internationally recognized worker rights and human rights, alongside issues relating to U.S. national security and foreign policy interests in its argument against Rwanda.
South Africa, meanwhile. Washington pointed to barriers to U.S. trade and investment, corruption, and concerns over national security and foreign policy interests.
If not addressed before the due dates, Washington’s actions could kneecap both economies and lead to significant job losses
“I’ve seen a lot of commentary diminishing the importance of AGOA to our economy. The fact is that the South African economy needs every possible competitive edge we can get. For the affected industries, it means more unemployment, production cuts, investment risk.
South African Andrew Whitfield, MPL wrote on X that the impact on his province, the eastern Cape, the economic impact is significant for citrus, automotive and components manufacturers.
*This article has been updated.
