Potential Loss of AGOA: A Threat to Consumer Spending and Music Revenue

The looming risk of South Africa losing benefits under the African Growth and Opportunity Act (AGOA) is casting a shadow over the music industry. AGOA, which grants duty-free access to U.S. markets for South African exports like manufacturing and minerals, is at risk due to trade tensions, with U.S. President Donald Trump pausing a 31% tariff for 90 days in April 2025. Losing AGOA could curtail exports, reducing economic activity and disposable income for South African consumers, who are critical to music revenue through ticket sales, merchandise, and streaming subscriptions. The OECD notes South Africa’s GDP growth averaged just 0.7% over the past decade, and further trade disruptions could push 2025 growth below 1%.

For musicians, this economic squeeze threatens domestic demand. With business confidence dropping to 40 in Q2 2025, corporate sponsorships for festivals and events are declining, limiting performance opportunities. The automotive sector’s 22% year-on-year sales growth in May 2025 offers some optimism, but broader economic fragility overshadows these gains. Musicians reliant on local gigs face reduced audiences as consumers prioritize essentials over entertainment. Additionally, a weaker rand, flat against a stronger dollar in June 2025, increases costs for imported equipment like instruments and recording gear, straining independent artists’ budgets.

To navigate this, musicians should diversify revenue streams by targeting international markets, where AGOA’s impact is less direct. Digital platforms and virtual tours can tap into global audiences, while partnerships with export-focused industries could secure alternative sponsorships. Advocating for trade policies that protect AGOA benefits is crucial, as is pushing for government support, such as subsidies for local music events, to bolster domestic demand. By blending global outreach with local advocacy, musicians can mitigate the economic fallout and sustain their careers.