Tariffs are not that complicated. They make imported goods cost more, simple as that.

SA does it all the time. Imported “bone-in” chicken is tariffed at 37% for example, though trade agreements make some countries exempt. You would be right to conclude that this means consumers here pay a lot more for chicken than they would otherwise.

SA actually has lots of tariffs in force on all sorts of goods. Clothes are subject to a 40% tariff (which is why SA tourists are often astounded to find the stores of Paris or Milan are actually reasonable) and cars at 25%.

The blended average tariff on imports into SA from the US is 7.6%, according to the US trade representative’s office — one of the reasons used to justify the 30% tariff on SA goods that kicks in this week.

The new US average tariff rate is going to be 18.3%. That will deal a major economic shock to the world — US average tariffs used to be 2.5%. They will suddenly jump to the highest level since 1934, the middle of the Great Depression.

What does it mean for producers? Tariffs improve the competitiveness of locally produced goods, if they exist. The higher cost of imported goods is borne by consumers, but the reduced demand for foreign goods is borne by foreign producers.

In the US, SA goods are going to cost more, so fewer of them are going to be consumed. But just how much less? It depends on the price elasticity of demand — essentially, how easily consumers can substitute our goods for something else. If consumers can simply substitute your goods for locally produced goods that are now cheaper, you’re in trouble. SA wines, for example, might well find themselves in that position against Californian competitors.

What complicates matters in this US tariff war is that it is not only domestic producers you have to worry about, but also producers from other countries that face lower tariffs. Their effective prices are now going to be lower than those of SA goods but higher than domestic producers. So it’s not just Californian wines that consumers may switch to, but also Chilean wines that are subject to only a 10% tariff.

SA’s 30% tariff is among the highest — only Brazil, Canada and Switzerland are higher. Several major exports are exempt, particularly precious metals. But the blow is going to be to manufactured goods and agricultural products, while copper gets a specific 50% tariff.

Vehicle manufacturers have already experienced this reality. Subject to 25% tariffs since April, SA automotive exports to the US collapsed by 80% in April and 85% in May. For companies that built their production specifically around the American market these figures are catastrophic.

It is clear that SA companies are going to be supplying less overall than they were before the tariffs, unless their goods are highly price inelastic. For those that will see demand fall the question will be by how much. There are going to be some consumers who still prefer a fine SA pinotage to a Californian zinfandel.

The stock that cannot be sold in the US at the higher tariffed price can be redirected to new markets, but that takes time. For example, some of our macadamia nut producers have already identified new markets in East Asia and have been putting the logistics in place to redirect them there.

So what will the actual economic effect of US tariffs be? It is still hard to understand precisely what will be exempt. Some platinum group metals will be, and that is a large part of the trade basket. Other raw materials will too — iron ore seems to be exempt, but not steel. It is probably going to take time for the situation to become clear.

Exports to the US account for 2.2% of SA’s GDP. Of that, vehicles account for 21%, agricultural goods 7% and machinery 4%. Some parts of those industries will therefore be hit hard. If we imagine that about half of the export basket will be hit by tariffs, that implies 1.1% of GDP will be affected.

The overall elasticities will vary — but if we imagine demand falls by 60%, that means about 0.7% of GDP needs to find other markets. Let’s imagine only half is successful — it would follow that about 0.35% of GDP will be lost. There will be other factors that affect things, including scale effects in that reduced production might push up production costs for SA manufacturers, but we’re probably in the ballpark to think a third of 1% of GDP will be lost.

The great uncertainty is just how permanent this change will be. SA might be able to make a breakthrough in doing a deal that gets the tariff cut, but I don’t put a high probability on that. Litigation in the US over the president’s ability to impose tariffs could upend the whole Trump strategy given that his legal route is dubious, relying on a 1977 law that was designed to sanction enemies or freeze their assets in response to “unusual and extraordinary” threats during national emergencies. Given that the US economy was in good shape before the tariffs, it is hard to see what the emergency is.

But perhaps more important is the politics of inflation. Trump appears to be shockingly naive about the inflationary effect of the tariffs. US prices are going to rise — that is simple supply and demand economics. Inflation is a political tinderbox for any president and could feed into economic chaos. We can imagine him firing the teams calculating inflation and then interfering with the Federal Reserve’s effort to tame it through higher interest rates. Eventually the charade will come crashing down and Trump’s political future will come to an end.

In the meantime though, global economic growth could also suffer a serious hit, and that would have second-order effects on our economy as global demand slumps. The size of that impact is difficult to anticipate, but it could be even bigger than the direct effect of the tariffs on SA output.

For our economy at the southern end of Africa, the short-term pain will be real. With growth barely running at 1%, losing a third of that will hurt, and even more from a global slowdown. But there will be a medium-term bounce-back as producers adjust, and US politics may well shift. This will be a moving target for some time.

• Dr Stuart Theobald is chair of research-led consultancy Krutham. This article first appeared in Business Day.