President Donald Trump has completely halted foreign aid to South Africa in response to the country's 'Expropriation Act.' In February, Trump signed an executive order that includes granting refugee status to white South Africans, thereby increasing pressure on the South African government.
On the 20th (local time), Bloomberg reported that Trump strongly criticized the South African government, stating that it is pursuing a land confiscation plan that amounts to near-genocide against white farmers. The Expropriation Act gives the government the authority to expropriate land for public purposes, but controversy arose after a clause was added allowing for compensation-free expropriation of land that is unused or held for speculative purposes.
The South African government immediately countered this criticism. President Cyril Ramaphosa stated, 'The Expropriation Act is a reasonable measure for public purposes' and emphasized that it follows both constitutional and legal standards for compensation. The government highlighted that there have been no cases of compensation-free expropriation to date, and enforcement is proceeding gradually and cautiously.
The background of this legislation lies in the deep-rooted issue of land imbalance in South Africa. Approximately 7% of the population, mostly white individuals, owns the majority of farmland, and the South African government has been pursuing land reform for decades to rectify this.
In 2017, the ruling African National Congress (ANC) attempted to push for compensation-free expropriation through a constitutional amendment but failed to gain the necessary two-thirds support in Parliament. Subsequently, at the end of last year, the Expropriation Act was finally passed in the form of a general law with a majority vote.
Domestically in South Africa, some opposition parties, agricultural groups, and investors are opposing this legislation. There are ambiguous points regarding the criteria for allowable compensation-free expropriations, and it is argued that these legal gray areas could have adverse effects on the national economy and food security.
In fact, the United States is also taking trade retaliation measures in addition to halting aid. Previously, South Africa had been able to export goods to the U.S. duty-free under the Generalized System of Preferences (GSP). However, Trump has imposed a minimum 10% tariff on global imports and a 30% tariff on South African goods, which has significantly impacted the South African economy.
However, analysis suggests that the U.S. tough response is also related to changes in South Africa's diplomatic stance. Earlier, South Africa took steps against U.S. interests by referring Israel to the International Court of Justice (ICJ) for allegations of genocide and strengthening diplomatic cooperation with Iran.
The South African government is seeking to alleviate diplomatic tensions. President Ramaphosa visited Washington on the 19th to explain the purpose and details of the Expropriation Act to the U.S. government and to initiate negotiations for tariff removal and trade normalization.
Elon Musk, the CEO of Tesla and a native of South Africa, is also opposing the country's policies. Musk criticized the black equity requirement demanded by the government during the expansion of the company's satellite internet service 'Starlink' as 'racist,' while the South African government continues negotiations by proposing alternatives such as infrastructure investment and rural area equipment distribution, according to Bloomberg.