Atomic Diplomacy: South Africa's Nuclear Bids and US Pushback
Aryana Ris-Luamháin | 12 March 2025
Summary
South Africa plans to expand its nuclear energy capacity and is open to bids from Iran and Russia, prompting pushback from the US amid existing geopolitical tensions.
Soured relations between South Africa and the US risk future nuclear cooperation and are particularly detrimental to the trade and healthcare sectors.
As South Africa proceeds with its nuclear bidding process, geopolitical tensions are likely to increase further. It is likely that South Africa will forge closer ties with the BRICS nations.
South Africa plans to launch a bidding process to increase its nuclear energy capacity at Koeberg, the country’s nuclear power plant, by 2.5GW. The initiative aims to address existing electricity shortages and reduce carbon emissions. Minister of Mineral Resources and Energy Gwende Mantashe reportedthat the country is open to bids from all interested parties, including Iran and Russia, “We can’t have a contract that says Iran or Russia must not bid, we can’t have that condition,”.
Mantashe’s comments have fuelled criticism that South Africa is aligning itself with anti-Western autocrats, which could heighten geopolitical tensions and strain its relationship with Western states, particularly the US. Such deterioration could negatively affect South Africa’s trade relationships, foreign investment and political standing.
His remarks come just days after a diplomatic row with the US wherein President Donald Trump signed an executive order to cut financial aid to South Africa, citing his disapproval of new land distribution legislation aimed at undoing the legacy of apartheid. The executive order also condemned South Africa’s “aggressive positions towards the United States and its allies, including accusing Israel of genocide…and reinvigorating its relations with Iran to develop commercial, military, and nuclear arrangements.”. In response, South Africa's foreign ministry released a statement condemning what it describes as a “campaign of misinformation and propaganda”. The financial cut will particularly affect the healthcare sector, which received the bulk of South African USAID in 2023. As a result, modelling suggests that HIV deaths in South Africa will increase by 500,000 in the next 10 years, posing a significant health risk to the country.
Heightened tensions between the US and South Africa may hinder the renewal of the Section 123 Agreement which allows the US to transfer nuclear material to South Africa. This could jeopardise future nuclear cooperation between the two countries – limiting access to fuel for Koeberg’s Unit 1 reactor and deterring US companies from investing in South Africa’s nuclear sector. There is also the risk that South Africa could be excluded from the African Growth and Opportunity Act (AGOA) which is an initiative that permits some African countries to export goods to the US without taxes. As 10% of South Africa’s export earnings in 2021 were driven by agriculture, this would have a significant impact on the country’s agricultural industry - potentially leading to reduced economic growth in rural areas and significant job losses.
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Forecast
Short-term
When South Africa launches its tender process, Russia and Iran are likely to submit bids given their interest in working with non-Western allies. South Africa is likely to proceed with agreements with these partners if they offer the best deals.
Medium-term
Supply chain disruption and budgetary shortfalls will likely emerge following the suspension of USAID. It is highly likely that millions of South Africans living with HIV will lose access to their medication.
If South Africa does finalise nuclear agreements with Russia and Iran, its relationship with Western states - particularly the US - will likely worsen and prompt further diplomatic pressure.
The cancellation of the Section 123 renewal and South Africa’s exclusion from the AGOA will likely take place. South Africa is likely to strengthen its ties with BRICS nations to offset the economic fallout.
Foreign direct investment will also likely slow, as Western companies will be hesitant to commit capital due to geopolitical uncertainty.
Domestic political instability and civil unrest from the economic disruption will likely follow.