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South Africa needs to seriously rethink Expropriation Act and BEE
South Africa’s relationship with the United States has reached a breaking point, driven by policy decisions that have sparked tensions on both domestic and international fronts.
Issues such as land expropriation, Black Economic Empowerment (BEE), and the ICJ case against Israel have put South Africa at odds with Washington.
These policies have caused South Africa to lose billions in aid and raised the risk of losing critical trade benefits and facing potential sanctions.
These are the views of Joel Pollak, an influential South African-born American commentator and senior editor-at-large at Breitbart News, who in an interview with BusinessTech argued that the key to repairing relations is not diplomatic changes, but fundamental policy shifts.
The US has historically been a key ally of Pretoria, with bilateral trade hitting R377.33 billion in 2024. In 2024, South African exports to the US hit R270.57 billion, up 4.9% from 2023.
Pollak, who was once considered for the role of United States ambassador to South Africa, noted how tensions have significantly worsened over the past several months, threatening this relationship’s future.
The recent expulsion of South African ambassador Ebrahim Rasool over anti-Trump remarks serves as just one clear example.
Beyond that, the US has already cut billions in aid, offered refugee status to “disfavored minorities,” and is reassessing its entire South Africa policy.
Pollak attributes this decline to its domestic policies and its international stances, particularly its ICJ case against Israel and perceived alignment with US adversaries.
“After many warnings and back and forth in the early months of the Trump administration, the South African government still has not come to the table with policy compromises,” Pollak said.
One of the primary issues straining relations is the Expropriation Act, which allows land seizures without compensation in certain circumstances.
Pollak pointed out that Trump had “taken an interest in human rights in South Africa since his first term and did speak out against expropriation back in 2018,” adding, “now that South Africa has passed an expropriation act, that concern has risen to new levels.”
Additionally, he argues that BEE laws, meant to address economic disparities, have deterred foreign investors.
“Foreign investors do not want to come in and give up their equity to a complete stranger simply because they’re the right color and they’re attached to the right party,” Pollak argued.
He also noted that similar policies in the US, known as Diversity, Equity, and Inclusion (DEI), are “being abandoned because they don’t work” and “actually hurt the people they’re supposed to help.”
Further straining relations is South Africa’s foreign policy, including its ICJ case against Israel and its growing alignment with Russia, China, and Iran.
Pollak suggests that South Africa, which is “supposed to be an ally of the democratic West,” is instead “behaving in a fashion that is more in line with either failed states… as an ally of China, Russia, and Iran.”
US Secretary of State Marco Rubio has already skipped a foreign leaders meeting G20 hosted by South Africa in its current state.
“My job is to advance America’s national interests, not waste taxpayer money or coddle anti-Americanism,” Rubio wrote.
Paths to Reconciliation: Proposed Policy Changes
Pollak outlined several specific policy changes that could improve relations between the two nations.
Addressing the contentious Expropriation Act is paramount. To alleviate significant concerns within the US administration and among potential investors, the Act should be amended to be very clear about protecting private property rights.
Furthermore, Pollak emphasises the importance of “explicitly protecting minority rights.”
Some “Afrikaners have made it very clear both in South Africa and the United States that their language is under threat and they’ve said they are not being given their civil rights under the Constitution to govern their own schools and to use their own language.”
This refers to South Africa’s BELA Act, which gives the government the final say on language and admission policies, taking into account the area’s broader demographics.
He said addressing these concerns could foster a more positive perception of South Africa’s commitment to human rights.
On the economic front, Pollak recommends that “foreign companies need to be exempted from black economic empowerment laws which are very difficult confusing”.
He believes this would create a more attractive investment climate and align South African policy more closely with international norms.
Perhaps the most significant international policy shift Pollak suggests is for South Africa to drop the ICJ case against close US ally, Israel.
South Africa filed its complaint on 29 December 2023, with the ICJ, the United Nations court responsible for resolving disputes between states. Pretoria accuses Israel of violating the Convention on the Prevention and Punishment of the Crime of Genocide in its military assault on Gaza.
Pollak argues that “South Africa is wasting money on this ICJ case and it’s destroying its own international image”.
He believes that doing so and encouraging Palestinians to “give up terror to suspend the arms struggle, sit down, and negotiate peace” would be in South Africa’s best interest and could lead to a change in the current negative narrative.
Looming Consequences of Policy Inaction
Should South Africa fail to address these policy concerns, Pollak said that the consequences for the bilateral relationship could be severe.
The African Growth and Opportunity Act (AGOA) benefits, which allow duty-free access to the U.S. market for sub-Saharan exports, are “in serious trouble”.
“South Africa is in technical violation of AGOA because AGOA says that participating countries cannot take positions contrary to the national security interest of the United States,” he said.
“I think South Africa’s position on Israel, Iran, China, and Russia all threaten AGOA,” Pollak said. The potential loss of AGOA benefits would have significant economic repercussions for South Africa.
Beyond AGOA, Pollak also suggests the possibility of “targeted sanctions at specific government officials or leaders”.
While acknowledging that the US administration may not want to “punish South Africans collectively for the misdeeds of a few,” he notes that if policies don’t change, targeted measures become a distinct possibility.
He even speculates that South Africans might be interested to know “where are their overseas assets? Which are the assets that an American administration could seize?”.
President Cyril Ramaphosa recently responded to the various developments, saying that he had “taken note of an Executive Order and recent statements by the current US administration about South Africa and aspects of our domestic and foreign policy.”
“We have expressed concern about the mischaracterisation of the situation in our country and certain of our laws and our foreign policy positions.”
“We will continue to engage with the US and other stakeholders to correct this mischaracterisation and to restore the ties between our two countries,” he added.
Full interview with Joel Pollak
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