Carbon Competitiveness: South Africa at the Net Zero–Trade Nexus

South Africa faces significant trade risks as its carbon-intensive export model clashes with global net zero targets and Carbon Border Adjustment Mechanisms (CBAMs). Approximately 78% of its exports are sold to countries with net zero targets, and hundreds of thousands of jobs are exposed to CBAMs in the EU and UK. High embodied CO2 emissions in the basic metals and automotive sectors, combined with a carbon-intensive electricity grid, threaten competitiveness. However, the document notes South Africa's potential to pivot using its critical minerals and renewable energy resources, provided that international financial commitments like the Just Energy Transition Partnership (JETP) are fulfilled.

• A large portion of South Africa's economy is exposed to international climate policies, with 78% of exports—valued at $135 billion—going to countries with net zero targets, supporting 1.2 million jobs as of 2023.
• Carbon Border Adjustment Mechanisms (CBAMs) pose a direct threat to employment, with 422,000 jobs dependent on exports to jurisdictions with active or incoming CBAMs (such as the EU and UK) and another 89,000 jobs linked to economies considering similar measures.
• South Africa's basic metals and automotive sectors are particularly vulnerable due to high carbon intensity. The basic metals sector has nearly double the embodied CO2 emissions of its closest peer and accounts for 32% of exports; 30% of these exports—worth $16.7 billion—go to CBAM-active or incoming markets. The automotive sector has the second-highest embodied CO2 emissions globally, with 65% of its export value exposed to CBAMs.
• Corporate supply chain requirements create further pressure, as 323 major companies in South Africa's top 10 export markets (representing $11 trillion in revenue) have full Scope 3 net zero commitments, and 45 more have Scope 3 reduction targets.
• South Africa's transition depends on its critical minerals (platinum group metals, manganese, vanadium, and chromium) and the delivery of over $8 billion in support from JETP partners, including the UK, EU, Denmark, France, Germany, and the Netherlands.

APA

Net Zero Tracker (2025). Carbon Competitiveness: South Africa at the Net Zero–Trade Nexus. https://zerotracker.net/analysis/south-africa-net-zero-trade-nexus

Chicago

Net Zero Tracker. Carbon Competitiveness: South Africa at the Net Zero–Trade Nexus. 2025. https://zerotracker.net/analysis/south-africa-net-zero-trade-nexus.

Wikipedia

{{cite report |author=Net Zero Tracker |title=Carbon Competitiveness: South Africa at the Net Zero–Trade Nexus |date=9 June 2025 |url=https://zerotracker.net/analysis/south-africa-net-zero-trade-nexus |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{netzerotracker2025carbon, author = {{Net Zero Tracker}}, title = {{Carbon Competitiveness: South Africa at the Net Zero–Trade Nexus}}, institution = {Net Zero Tracker}, year = {2025}, month = jun, url = {https://zerotracker.net/analysis/south-africa-net-zero-trade-nexus}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }