This new policy is the latest measure of the Trump administration against South Africa, following its false accusation that the government is persecuting white South Africans.
The US government has said it is suspending South Africa and Rwanda from its duty-free trade programme under the African Growth and Opportunity Act (AGOA).
US Trade Representative Jamieson Greer said on Monday that both countries failed to meet AGOA's eligibility criteria.
He cited concerns about human rights, corruption and threats to US interests as justification for the policy, which will take effect on 1 January 2027.
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South Africa has been the largest beneficiary. In 2025, it exported about $1.7 billion worth of goods to the US under AGOA.
"President Trump found that the governments of Rwanda and South Africa are engaging in practices that are inconsistent with AGOA's eligibility criteria," Mr Greer said in a statement.
He said practices include "barriers that undermine American trade and investment and practices that pose a threat to US national security and foreign policy interests in the region."
However, he did not provide specific examples of the trade barriers or security and foreign policy issues in question.
The programme, which is reviewed regularly and was extended in February by President Donald Trump, was introduced in 2000. It is a centrepiece of US economic engagement with sub-Saharan Africa.
Access to the US market without tariffs is considered a major economic opportunity for the more than 30 African countries participating in AGOA. The agreement provides duty-free benefits for over 1,800 eligible products.
US tension with South Africa
This new policy is the latest measure of the Trump administration against South Africa since falsely accusing its government of persecuting white South Africans. The country has repeatedly rejected this allegation.
The US also antagonises South Africa for its genocide case against Israel at the International Court of Justice.
Meanwhile, the Trump administration is putting pressure on Rwanda over its alleged support of the M23 rebel group in Congo.
Last week, South Africa's Department of Trade, Industry and Competition said it was prepared for a negative outcome from the AGOA eligibility review. President Cyril Ramaphosa had also previously said the country must prepare for being cut out of the programme. He said that South Africa was already seeking new markets and signing new trade deals with other partners such as China.
In a statement issued on Tuesday, Trade and Industry Minister Parks Tau said South Africa's expulsion from AGOA was imminent, but noted it does not mark the end of trade with the US.
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Mr Tau said although the programme is important to South Africa, it accounts for only 1 per cent of the country's total global exports, and a minority of those to the US itself.
Mr Tau said South Africa has 60 days to address the concerns raised by the US, and that the government "recognises the concern that this decision may create for workers, exporters, businesses and communities linked to AGOA-value chains."
