The US-South Africa Bilateral Relations Review Act of 2025 will negatively affect the local property sector’s investment dynamics and have cost implications if it becomes law.
The bill was introduced by Ronny Jackson, a congressman from Texas, in April. For it to become a law, it will need to be approved by the House and Senate before being signed by President Donald Trump.
It accuses South Africa of undermining the United States’ interests by maintaining close relationships with the People’s Republic of China and the Russian Federation, nations that are Pretoria’s strong allies and key trading partners.
On investment dynamics, Dr Farai Nyika, an academic programme leader in the School of Public Administration at the Management College of Southern Africa(MANCOSA), says South Africa’s property sector depends significantly on both domestic and international investment.
He said foreign involvement includes not only direct investment in physical developments but also the purchase of South African property-related shares on the Johannesburg Stock Exchange (JSE).
“Should the bill become US law, the geopolitical risks associated with doing business in South Africa may deter foreign investors. This could result in a slowdown in physical property developments by foreign investors and a sell-off of South African property stocks.
“Such a sell-off would constrain these companies’ ability to raise capital, potentially leading to reduced profitability, operational cutbacks, and, disastrously, job losses,” Nyika told “Independent Media Property”.
The academic leader said it is key to note that the bill, in its current form, may change to broaden penalties beyond what is currently stated, so they could only speculate on its current form.
He said it should be remembered that the bill is really targeting South African individuals, rather than the country as a whole.
“However, perceptions matter more than reality and legal precision; for example, though Zimbabwean politicians were the target of U.S sanctions in 2003, the Zim government claimed that the country’s subsequent economic hardships were the result of the entire country being sanctioned.
“By extension-sanctions that target individuals indirectly harm the economy. Because many property investors will say that they do not want to do business in a country that the ‘US is sanctioning’.
“Perversely, there could be some economic benefits to the local property market from the U.S sanctioning local politicians. If foreign investors exit the market, property prices may cool.
“This could make housing more affordable for locals who have previously been priced out-particularly in urban centres like Cape Town, where gentrification has greatly limited social mobility and access to property ownership,” Nyika said.
With regards to cost implications, he said a large proportion of building materials, especially high-end fixtures for luxury properties and solar technologies, are imported. He said in a country that has been grappling with persistent load shedding and a transition to cleaner energy, the demand for solar and energy-efficient solutions is rising.
“However, if the bill disrupts trade relations or leads to broader sanctions, the cost of these imported materials may increase, raising construction and development costs. This could slow down South Africa’s Just Energy Transition in the short term.”
With that said, Nyika said economic pressure often fosters innovation. He said historical precedents show that sanctions or trade restrictions can trigger industrial growth-as was the case in both Zimbabwe and apartheid-era South Africa during the 1960s and 70s.
“In the long run, if the South African government were to prioritise industrial policy and local manufacturing, the country could reduce reliance on imports.
“This would benefit the property sector by fostering domestic production of certain formerly imported building materials and solar items, improving resilience, and potentially creating new economic opportunities to expand local property.”
Asked whether the South Africa property sector will have resort in this regard, Dr Thandile Ncwana, also an Academic Programme Leader at the same institution, said but some of the possible strategic play for South Africa in this situation should the bill be approved, is to mitigate escalation and maintain its relationship with the US by considering engaging in high-level bilateral diplomacy aimed at clarifying its foreign policy positions while reaffirming its commitment to democratic values, trade and multilateral cooperation.
She said proactive parliamentary diplomacy, Track II dialogue forums, and regular engagement with the US Congress and civil society actors could help reframe South Africa’s stance as one of principled non-alignment rather than strategic antagonism.
“Because reinforcing bilateral economic ties and highlighting areas of mutual benefit, such as climate action, infrastructure development and health, can serve as diplomatic buffers. The government also have a chance to carefully balance between asserting its foreign policy independence and avoiding diplomatic or economic isolation.
“This can be achieved by adopting a transparent foreign policy communication strategy, clearly articulating the principles behind its international engagements, and avoiding actions that may be interpreted as tacit support for states or groups under U.S. sanctions,” Ncwana said.
She added that multilateralism should remain at the heart of South Africa’s diplomacy, and efforts must be intensified to build consensus with African partners, BRICS allies, and Western institutions alike to maintain strategic flexibility and avoid becoming a casualty of great-power rivalry.
Politically, she said South Africa should adopt a dual-track diplomacy strategy that preserves its non-aligned international stance while actively engaging U.S. policymakers to dispel misconceptions about its foreign policy positions.
“This includes convening high-level bilateral dialogues, leveraging multilateral platforms like the United Nations and African Union to clarify its principled positions, and re-establishing structured parliamentary exchanges with the US Congress.
“South Africa’s leadership can also benefit from a strategic public diplomacy campaign that communicates its commitment to constitutional democracy, human rights, and peaceful conflict resolution principles historically shared with the US.
“These efforts can de-escalate tensions and rebuild political trust, allowing space for honest disagreement without undermining the broader relationship.”
Ncwana said that overall, the South African government can lastly play a strategic move by enhancing interdepartmental coordination, particularly between the Departments of International Relations and Cooperation (DIRCO), Trade and Industry, and National Treasury to ensure cohesive messaging and responsiveness to external developments like the US legislative process.
Independent Media Property
