Mesoscale eddies can be strengthened by the absorption of submesoscale eddies resulting from mixed-layer baroclinic instabilities. This is shown for mesoscale eddies in the Agulhas Current system by investigating the kinetic energy cascade with a spectral and a coarse-graining approach in two model simulations of the Agulhas region. One simulation resolves mixed-layer baroclinic instabilities and one does not. When mixed-layer baroclinic instabilities are included, the largest submesoscale near-surface fluxes occur in winter-time in regions of strong mesoscale activity for upscale as well as downscale directions. The forward cascade at the smallest resolved scales occurs mainly in frontogenetic regions in the upper 30 m of the water column. In the Agulhas ring path, the forward cascade changes to an inverse cascade at a typical scale of mixed-layer eddies (15 km). At the same scale, the largest sources of the upscale flux occur. After the winter, the maximum of the upscale flux shifts to larger scales. Depending on the region, the kinetic energy reaches the mesoscales in spring or early summer aligned with the maximum of mesoscale kinetic energy. This indicates the importance of submesoscale flows for the mesoscale seasonal cycle. A case study shows that the underlying process is the mesoscale absorption of mixed-layer eddies. When mixed-layer baroclinic instabilities are not included in the simulation, the open-ocean upscale cascade in the Agulhas ring path is almost absent. This contributes to a 20 %-reduction of surface kinetic energy at mesoscales larger than 100 km when submesoscale dynamics are not resolved by the model.