SOUTH AFRICA PROPOSES $12B LNG DEAL WITH US FOR DUTY-FREE TRADE

South Africa offers $12B LNG deal with US, seeks duty-free vehicle, steel exports in 10-yr trade package to boost energy security, ties.

South africa us trade Lng deal 2025 Duty-free exports

South African President Cyril Ramaphosa and U.S. President Donald Trump at the White House

South Africa has put forward a $12 billion trade proposal to import liquefied natural gas (LNG) from the United States over a decade, aiming to secure duty-free access for its vehicle, steel, and aluminum exports. The deal, announced on May 26, 2025, by Minister in the Presidency Khumbudzo Ntshavheni, was proposed during a May 21 meeting between South African President Cyril Ramaphosa and U.S. President Donald Trump at the White House. The initiative seeks to reset strained bilateral relations and bolster South Africa’s economy amid looming U.S. tariff threats.

The trade package includes South Africa importing 75–100 petajoules (approximately 75–100 million cubic meters) of LNG annually from the U.S., the world’s leading LNG exporter. Ntshavheni stated this could generate $900 million to $1.2 billion in annual trade, totaling $9–12 billion over 10 years. The deal would be complemented by U.S. investment in South African gas infrastructure, including fracking technology to unlock domestic gas production in regions like the Karoo, where exploration has been stalled due to environmental concerns.

South Africa, facing potential gas shortages as supplies from Mozambique dwindle, aims to diversify its energy sources while transitioning from coal. Ntshavheni emphasized that U.S. LNG imports would complement, not replace, existing suppliers. In return, South Africa seeks duty-free quotas for 40,000 vehicles, 385,000 tonnes of steel, and 132,000 tonnes of aluminum exported annually to the U.S., alongside tariff-free automotive components for U.S. production.

The proposal comes as U.S.-South Africa relations face challenges, with Trump criticizing South Africa’s land reform policies and making unfounded claims of “genocide” against white farmers. With the African Growth and Opportunity Act set to expire in September 2025 and Trump’s 30% tariffs looming, South Africa aims to secure economic stability through this deal. Negotiations with the U.S. Trade Representative are ongoing, with Ramaphosa emphasizing the strategic importance of deepening trade ties with the U.S., South Africa’s second-largest trading partner.

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SOUTH AFRICA PROPOSES $12B LNG DEAL WITH US FOR DUTY-FREE TRADE

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