We all know that global trade is becoming increasingly important. Economies are navigating challenges on multiple fronts, businesses are under pressure to remain competitive, and every opportunity to grow, invest and create new markets must be seized to lead to success.

But what if some of those opportunities are already within reach, and we simply aren’t making the most of them?

For Africa, one such opportunity is the African Growth and Opportunity Act.

AGOA is a U.S. trade programme established in 2000 to strengthen economic and trade relationships with eligible countries in Sub-Saharan Africa. It provides duty-free access to the U.S. market for more than 1,800 qualifying products, spanning a wide range of manufactured and value-added goods, including automotive components, textiles and apparel, agricultural and processed food products, chemicals, plastics, metals and other industrial products.

Following President Donald Trump’s announcement and the subsequent extension of AGOA through 31 December 2028, South African manufacturers have been given additional time and certainty to pursue opportunities in one of the world’s largest markets.

But access to a market is only part of the equation.

The real question is: are we equipped to take advantage of it?

Because securing an opportunity to supply an international customer is one thing. Having the machinery, skills, capacity and processes to fulfil that opportunity – consistently, competitively and at the required standard – is another.

For KNUTH Machine Tools, however, the significance of AGOA extends far beyond the trade agreement itself.

Does the African industry have the production capacity, technology and skills required to turn market access into manufactured exports?

“We often talk about market access as though it is the finish line. It isn’t. It is the starting point. If African manufacturers are going to compete for more international business, we need to build the production capacity and capabilities that allow us to compete -and deliver – at an international level,” says James Fourie, Technical Sales Team Lead, KNUTH SA.

For manufacturers across sectors such as automotive, mining, engineering and energy, increased export opportunities could mean greater demand, making it essential to optimise operations, improve productivity and strengthen production capacity.

From Market Access to Manufacturing Capacity

The renewed focus on AGOA comes at a time when manufacturers globally are under pressure to produce more efficiently while controlling costs and maintaining consistent quality.

For African manufacturers, the opportunity is therefore not simply about exporting more. It is about being equipped to manufacture more competitively.

There are plenty of ways manufacturers can improve how competitively they operate. It can start with something as simple as identifying production bottlenecks, reducing downtime or getting more out of existing equipment. For others, it may mean improving production planning, reviewing tooling and processes, upgrading ageing machinery, introducing CNC technology or investing in automation.

Just as importantly, manufacturers need the right skills to make the most of these improvements and ensure that technology translates into real gains on the shop floor.

“Manufacturing competitiveness starts long before a product reaches the shipping container,” says Ruan Cowley, Managing Director of KNUTH SA. “It starts with the equipment, the people operating it and the processes behind it. If AGOA creates additional demand, manufacturers need to be ready to respond to that demand, and that requires investment in production capability.”

This is particularly relevant for businesses that may currently be operating with limited capacity or processes that are already under pressure.

A manufacturer receiving an opportunity to supply a larger international customer cannot necessarily scale simply by adding another order to the production schedule. Increased volumes can expose operational inefficiencies.

The result is that market access can quickly become a manufacturing-capacity challenge.

The Machinery Question

For more than 100 years, KNUTH Machine Tools has been part of the global manufacturing industry, working alongside manufacturers as production methods, technologies and market demands have evolved.

That experience has shown that improving manufacturing competitiveness is rarely about one machine or one investment. It is about understanding the operation as a whole.

For machine shops and component manufacturers, technology can play an important role in that process. Modern CNC machinery, for example, can improve consistency, reduce manual intervention and support the production of more complex components. But the right technology depends on the needs of the individual operation.

“Buying a machine is not the same as improving a manufacturing operation,” says Fourie. “You first need to understand where the constraints are. It could be capacity, workflow, skills, tooling, programming or simply the way a process is being managed. Once you understand that, you can make more informed decisions about where technology can add real value.”

That broader approach becomes increasingly important as manufacturers look to compete for international business.

Ultimately, the goal is not simply to have more technology on the factory floor. It is to build more capable, efficient and competitive manufacturing operations.

“International competitiveness isn’t built overnight,” says Cowley. “It requires manufacturers to make decisions today that improve their ability to compete tomorrow. That includes machinery, skills, service, maintenance and the ability to keep production running.”

A Window – Not a Guarantee

AGOA’s current authorisation runs through the end of 2028, while the United States has also begun a process to consider how the programme could be modernised.

That means manufacturers should view the current environment as an opportunity to assess their readiness rather than simply waiting for export demand to appear.

AGOA is also not the only preferential trade opportunity available. Through agreements and arrangements such as SACU, SADC, the African Continental Free Trade Area (AfCFTA), the SADC–EU Economic Partnership Agreement, the SACUM–UK Economic Partnership Agreement, SACU–EFTA and SACU–MERCOSUR, South African businesses have access to a range of regional and international markets under preferential trading conditions.

The markets are there. The opportunity is there. The question is whether African manufacturing is ready to make the most of it.

For KNUTH, that means encouraging manufacturers to consider a more fundamental question: If a new international opportunity came across the desk tomorrow, would the factory be ready to produce it?

The market may open the door. Manufacturing capability determines whether you can walk through it.

Newlyn Group is moving ahead with the development of its Newlyn Logistics Park in Gqeberha, with the first 10,000m² warehouse nearing completion and construction of a second facility scheduled to begin in October 2026.

Located along Cape Road (R102), around 5km from the N2 and approximately 20 minutes from the Port of Gqeberha, the development is designed to accommodate logistics, distribution and light manufacturing businesses. The wider logistics park covers approximately 150,000m², with additional warehouse phases planned as demand develops.

The first phase includes a 10,000m² warehouse, a matching 10,000m² yard and between 200m² and 300m² of office and ancillary space. Completion is expected by December 2026. The next phase will add another warehouse of the same size, supported by a dedicated yard.

Warehouse Design Focuses On Operational Efficiency

Rather than focusing solely on warehouse size, Newlyn has incorporated features intended to support the practical requirements of storage, handling and distribution operations.

The buildings have a 24m by 24m column grid to provide open operating space, alongside a clear internal height of 10.5m beneath the structural trusses. This allows for racking of approximately 9m to 10m, or around seven levels, using conventional materials-handling equipment.

The warehouse floors are designed to support distributed loads of 10 to 12 tonnes, with joints positioned to account for racking layouts and the loads placed on rack legs. These considerations can help reduce the need for costly modifications when tenants install their storage systems.

Outside, heavy-duty paved yards are designed to withstand truck and reach-stacker movements. The development also incorporates reinforced concrete in high-turning and high-wear areas to accommodate the demands of regular vehicle movements.

These specifications are intended to help businesses configure their facilities around their operational needs, from goods storage to loading and dispatch.

Infrastructure Designed for Long-Term Use

The development also incorporates features intended to address energy use, building maintenance and Gqeberha’s coastal conditions.

Steelwork has a 15-year anti-corrosion specification, while the roof system is designed without penetrations. The structures are also engineered to accommodate rooftop solar panels, allowing tenants to add photovoltaic capacity without requiring retrospective structural strengthening.

Translucent roof sheeting allows natural light into the warehouse during the day, while ventilation systems support fresh-air circulation and smoke extraction. LED lighting can also be paired with motion or timing sensors to limit unnecessary energy use.

Fire protection is another key consideration. The logistics park will use a shared dual-tank, dual-pump firefighting water system designed to support firefighting in two buildings simultaneously for up to two hours. Warehouse sprinkler systems, early-warning smoke detection and smoke curtains form part of the wider fire-safety provisions.

Utility infrastructure includes individual electricity and water meters, backup water storage and a borehole alongside the municipal supply. Stormwater systems have also been designed to account for the site’s floodplain conditions.

Security will combine perimeter fencing and AI-enabled camera monitoring with a central control room. Individual tenants will be able to establish additional security measures around their own operations.

Further Phases to Respond to Demand

Newlyn has approved plans for additional warehouse options of 12,000m², 7,000m² and 3,000m² as the logistics park expands. This gives the developer scope to respond to different occupier requirements rather than committing to a single warehouse size across the entire site.

According to Viresh Persad, Newlyn Group’s chief development officer, the aim is to incorporate practical operational requirements into the initial building design while retaining flexibility for different tenants.

The development adds to the warehousing infrastructure available in Gqeberha, with its location providing access to the N2 and the Port of Gqeberha. For logistics operators, the combination of transport links, yard capacity and adaptable warehouse space will be central to determining how well the facility meets their distribution and storage needs.

Source: Newlyn Group, via Catchwords Newsroom.

South Africa’s township economy is not only facing a demand problem. For many businesses, the bigger challenge may be getting the right products to the right place at a competitive price.

The 2026 Rural and Township Economy Report highlights significant procurement and distribution challenges facing businesses outside the country’s major commercial centres. According to the Department of Trade, Industry and Competition (the dtic), informal businesses face higher procurement costs and limited access to formal distribution channels, while consumers can face higher effective prices because of limited product variety and quality.

For the supply-chain industry, this points to a problem that sits further upstream than the shop itself.

If a business cannot source products reliably, competitively and in sufficient volume, its ability to compete is constrained before the customer even walks through the door.

The Cost of Getting Stock

Procurement is one of the clearest pressure points.

The Competition Commission’s Rural and Township Economy Project identifies constraints in how township and rural businesses source and sell goods, with smaller businesses facing challenges that can prevent them from scaling and integrating more fully into broader value chains.

The issue is partly one of scale.

A small retailer buying limited quantities does not necessarily have the same purchasing power as a larger chain. That can affect the prices it pays, the range of products it can stock and how frequently it can replenish inventory.

The result is a cycle where scale becomes an advantage not only for retailers, but for businesses further up the supply chain as well.

A business that pays more for stock has less room to compete on price. If it cannot reliably obtain popular products, it also risks losing customers to businesses that can.

Distribution Determines What is Available

Price is only one part of the problem.

Stock availability matters just as much.

The dtic has identified stock availability as a key challenge for township businesses, noting that consumers are less likely to return when products are out of stock. The department has also highlighted the need for better supply-chain management and point-of-sale technology to improve the customer experience.

That changes how the distribution problem should be viewed.

A product sitting in a national warehouse does not necessarily help a consumer in a township. It still needs to move through the right wholesale or distribution channel, reach the local business at the right time and be available when the customer wants it.

This final connection can be easy to overlook when supply chains are designed primarily around large formal retailers.

The Route to Market Matters Too

The challenge also works in the other direction.

Many township businesses are heavily dependent on their immediate local customer base, limiting their ability to reach larger markets.

That creates a similar problem for producers and manufacturers. A business may have a product that could sell beyond its immediate area, but reaching those customers requires access to distribution, retail and digital channels that may not be readily available.

The supply chain therefore affects both sides of the market: how businesses get products in and how they get products out.

That is particularly important if South Africa wants township enterprises to become more integrated into broader manufacturing and distribution networks rather than remaining largely localised.

Could Aggregation Help?

One potential way to address the scale problem is through greater purchasing power.

In a recent address to women entrepreneurs, Deputy Minister of Trade, Industry and Competition Zuko Godlimpi encouraged township businesses to form partnerships and cooperatives so they can buy and sell in greater volumes.

The logic is straightforward. If smaller businesses can aggregate their demand, they may be able to access some of the purchasing advantages normally associated with larger buyers.

Government has already incorporated this principle into support for township community convenience stores. The dtic’s Spaza Shop Support Fund includes support for stock procurement and delivery, while the department has said the programme is intended to strengthen links between spaza shops, local manufacturers, black industrialists and wholesalers through bulk purchasing arrangements.

But aggregation still needs infrastructure behind it.

Someone has to consolidate orders, manage inventory, arrange transport, handle storage and distribute stock. Without those capabilities, simply combining purchasing power will not solve the wider distribution problem.

Closing the Distribution Gap

South Africa has no shortage of entrepreneurial activity in its townships. The challenge is making it easier for those businesses to participate in supply chains that extend beyond their immediate surroundings.

That means looking beyond the individual retailer.

Better wholesale networks, more efficient distribution channels, technology that improves stock visibility and logistics models designed around smaller businesses could all help reduce some of the disadvantages created by limited scale.

It also means recognising that access to a product is not the same as access to a supply chain.

A township retailer may technically be able to buy a product, but if it pays more, receives inconsistent supply or has limited access to alternative suppliers, it is competing from a weaker position.

The 2026 Rural and Township Economy Report makes clear that procurement, stock availability and access to distribution remain important barriers for many smaller businesses.

Closing that gap will therefore require more than encouraging businesses to grow. It will require supply chains that allow them to buy competitively, maintain reliable stock and reach more customers.

For South Africa’s township economy, better distribution could be one of the practical ways to turn local business activity into businesses that can genuinely scale.