SA wants to eat and have, and bake, too much cake

NEW WORLD ORDER

SA wants to eat and have, and bake, too much cake

It is time to play a smarter game in our relations with the US if we want to thrive under Trump 2.0. GIULIETTA TALEVI of Currency News has some questions for Greg Mills, head of the Brenthurst Foundation.

ANGELA TUCK
ANGELA TUCK

US president Donald Trump means business – for America first. What then are the clever choices South Africa needs to make? Currency News talks to Greg Mills, head of the Brenthurst Foundation.

What’s at stake for us under the Trump presidency? How do we play our cards right? 

[Donald Trump] certainly likes to portray himself and is likely to be a disruptor, so it’s hard to know how to pitch your offer when the environment is so uncertain. Given what we know, I think there are two competing tensions here: trade and investment on the one hand, and on the other, our relationship with nascent groupings such as the BRICS, and Russia and China in particular.

South Africa keeps trying to align itself more closely with the interests of the “global South” and if you mention the word amorphous there never has been a more amorphous concept. So we have this tension at the heart of the US-South Africa relationship: one, we want a more radical change in the world order; Trump wants a more radical change in the world order but he wants it pretty much in the opposite direction.

And then there are several different aspects: we have a trade and investment relationship with the US which has done well out of the last decade and America has increased its stake in SA’s economy; it remains a very important trade partner – one of the top 3 – and we are beneficiaries of Agoa [the preferential tariff agreement under the African Growth and Opportunity Act]. As the major industrialised economy in Sub-Saharan Africa, we have a natural leadership role in that regard as well. Yet we are trying to have our cake and eat it – that cake, and trying to bake another with the global South. 

Will we be forced to choose which cake we get to eat? 

Trump is pretty anti-free trade, using tariffs as a stick with which to beat his closest allies. So I would imagine that in those circumstances, Agoa might well be a stick with which we are beaten. But let me say this: he’s a New York property guy and this is a negotiation. He comes up with an offer, you come up with an offer and you hammer it out and you cut the art of the deal somewhere in the middle. It’s not generally how international diplomacy works but in the case of Trump it seems to work for him, [like] the progress he’s made in the Middle East after months of faffing around by Joe Biden.

But he’s a conservative so our position on things like the ICJ [International Court of Justice] case in the Middle East is unlikely to endear – and certainly hasn’t endeared SA - to influential Republicans. So we have these causes we’ve taken up which are antithetical to the belief [of] many in the Republican camp and that’s going to complicate the relationship. He is going to expect us to do things in Africa which are aligned to US interests and if we run counter to those interests, we’re likely to be the target of American opprobrium. 

What about American foreign aid? 

They’ve suspended foreign aid for 90 days as they repurpose and try and work out what’s working. And it’s a fairly cumbersome bureaucracy on a good afternoon so it’s probably going to take a lot longer, but it’s a sign that it’s not business as usual. But actually in many parts of Africa, paradoxically, that’s going to be welcomed because business as usual implies an elite which pretty much goes off and does its own thing and a fairly careless international order that’s not really concerned about everyday challenges facing the average African: 93% of Africans live in authoritarian circumstances; just 7% live in democracies.

Perhaps that’s the most interesting question: is Trump going to be so transactional that he simply pursues naked self-interest, or will he see democracy as part of that bouquet of interests that the US holds? And if he does, SA’s ambiguous view about democracy promotion in Africa and supporting election processes will find us in further conflict if America takes that turn. 

How much aid do we get from the US? 

US aid overall to Africa is about $60bn; or 27% of global aid, so the SA total is about $700m. And the Heritage Foundation in the US says it’s time to cut aid to SA. They say that all it does is reduce the link of accountability with African electorates – and why is the US taxpayer funding us when we’re doing things that are antithetical to their national interest? SA has to be very careful not to get into Trump’s sights.

If there were three savvy things to do now as SA, what do you think they should be? 

  • Wind our neck in on Israel,
  • Make renewed efforts to partner with the US in resolving conflicts in places like Sudan although that’s going to be very hard for us to do, and
  • Work on democracy promotion across the continent because it’s in the interests of economies because democracies grow faster, are wealthier, etc.

Come up with a programme that aligns. So turn down the volume on issues of difference and turn up the volume where we have common interests.

  • Dr Greg Mills heads the Johannesburg-based Brenthurst Foundation, established in 2005 by the Oppenheimer family to strengthen African economic performance.

  • Find Currency News here.

♦ VWB ♦


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