While premier Oscar Mabuyane used his policy speech on Tuesday to warn of a looming economic crisis in the province as a result of new US export tariffs, he also took a swipe at SA-born American-based billionaire, Elon Musk.
Mabuyane accused Musk of “trying to collapse a rainbow nation that many people sacrificed their lives for”.
Delivering his budget and policy speech at the Bhisho legislature, Mabuyane said the province should brace itself for “terrible times ahead when it comes to economic growth”.
“Despite the current trade war the US is waging against our nation as well as a number of other countries, we remain resolute in finding alternative markets to minimise the impact on our economy.”
This was in reaction to the steep tariffs imposed by US President Donald Trump, which took effect on Wednesday.
Mabuyane referred to the US move as a trade war.
The tariffs exceed a base rate of 10% imposed on many other countries last week.
In all, imports from 86 countries, are now subject to higher tariffs ranging from 11% to 84%, with SA’s new tariff standing at 30%.
Mabuyane said the US move would be “quite negative on the Eastern Cape economy”.
“We aspire that by 2030, the Eastern Cape will be an enterprising and connected province where its people reach their full potential.
“We are building on a solid foundation of progress, which we achieved on many fronts in the past five years.
“Despite the current trade war the US is waging against our nation, as well as a number of other countries, we remain resolute in finding alternative markets to minimise the impact on our economy.”
After meeting business leaders in Gqeberha this week, Mabuyane said he was informed that tariffs on cars manufactured in SA for export to the US could go up to as much as 55%, saying this would be “terrible for the province’s economy”.
Mercedes-Benz SA exports cars to the US, and other car manufacturers are some of the province’s major employers.
“This is going to be quite negative on our economy, so we must brace ourselves for more terrible times ahead when it comes to economic growth.
“We now don’t have a choice, we need to think deep, think serious. We need to put our heads together.
“We’ve got to meet to discuss, in the light of what is happening as led by the US president, how best we can look at options to diversify and expand our resource base as well as our market out there.
“We’ve got to sit down with the US, we’ve got to talk to the US, we’ve got to find solutions in these strained relations.
“The unfortunate part is that the president of the US is surrounded by South Africans, but the way things are happening there, it is very bad.
“It is very unfortunate to have people who call themselves South Africans, but who are these dual citizens and when they like they can be here and say they are home, and tomorrow they are in another place and still say they are home.
“We’re not going anywhere. We are stuck here. We’ve got to make this country the best country our forebears sacrificed so much for.
“So it is very unfortunate seeing people like Elon Musk [a senior adviser to Trump] and others doing what they are doing, trying to collapse a country, a rainbow nation that many people sacrificed their lives for.
“We are appealing to those who are friends with them to talk to them, so they come to their senses,” Mabuyane told the legislature.
Speaking exclusively to the Dispatch on Wednesday, Mabuyane said this was a start: “From this embryonic stage it is clear that this is likely to hit us hard. If we are not able to deal with this diplomatically, this is going to give us tough times.
“There are a lot of trade relations between SA and the US, and remember, a lot of our natural resources are also going to the US.
“That is why the US president, after announcing this thing, realised he was shooting himself in the foot and started to backtrack, and removed some things from his list, because they need our natural minerals, but they do not want us.
“That can’t be a fair bilateral trade relationship. It’s exploitive and disruptive.
“But we cannot subject ourselves to any bullying, because what we have, we deserve, and it cannot just be about us being submissive and succumbing to anything that comes.”
Mabuyane said the provincial government would soon meet the automotive sector to get first-hand from them the implications of the US moves.
Meanwhile, delivering his policy speech on Wednesday, finance MEC Mlungisi Mvoko said the province’s economic landscape “remains fragile, shaped by persistent geopolitical and regional tensions that continue to impact our national and provincial economy”.
He said the shifting policies of global superpowers, such as the US, “have influenced trade, supply chains, and financial markets, creating challenges for our fiscus”.
Daily Dispatch
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