From crisis to catalyst: How US tariffs could spur South Africas defence industry

Show Voice Options The USA has formally communicated that South African goods will be subject to a 30% tariff effect 1 August. The result is that many manufacturers are going to need to find alternative markets. Most analysis is on the larger sectors of mining and automobiles. There are the smaller manufacturing sectors aligned with the aerospace (Sling Aircraft and the many Space cube suppliers) and maritime (Robertson & Caine that support 10,000 jobs building catamarans) sectors that could be severely impacted. The defence industry is not significantly affected by this development, but it does present an opportunity, to collaborate with countries now seeking to substitute US goods due to also being penalised with excessive tariff increases. The defence industry now has a chance to exploit dual use product opportunities. South Africa is in an enviable international position. The country possesses established Research, Development, Test, and Evaluation (RDT&E) capabilities. Countries with a full RDT&E capability all leverage the defence sector as a technology incubator. The defence sector also requires testing and evaluation to strict standards. South Africa is interesting in that it is the country with the lowest defence spend that has a full RDT&E capability. South Africa is still seen as a top RDT&E country – the challenge is maintaining its test and evaluation (T&E) capability with the reduction in defence spending.