The US has just declared economic war on Africa. It will backfire

Russia Today

17 hours ago

In April, US President Donald Trump implemented new tariff policies, imposing a maximum of 50% on goods entering America from African countries. They previously enjoyed free access benefits from the Africa Growth and Opportunity Act (AGOA), which, according to the Center for Global Development, used to provide sub-Saharan African countries with duty-free access to over 7,000 products.
In 2023, the Office of the US Trade Representative reported that the US imported goods worth $9.7 billion under the AGOA, with South Africa ($14.0 billion), Nigeria ($5.7 billion), Ghana ($1.7 billion), Angola ($1.2 billion), and Cote d'Ivoire ($948 million) being Africa's biggest exporters.
But with a 10% universal tariff now imposed on all African nations, experts believe the AGOA may have come to an end. However, the same experts also say Africa's market of 1.4 billion people can serve as the best response to external economic shocks caused by Trump's trade tariffs.
Dr. Francis Owusu, a trade economist at the University of Ghana, notes that with the new tariffs, 'Trump not only made AGOA lame, but also prepared it for eventual death.'
'There is no way AGOA will be beneficial to African countries with the new tariffs in place. It makes no sense at all,' Dr. Owusu said. 'Trump's tariff policy rendered AGOA meaningless.'
Dr. Owusu says that, instead of lamenting over Trump's tariff actions, African leaders must breathe life into the African Continental Free Trade Area (AfCFTA).
'What Africa needs is regional trade and economic resilience. With a population and market of over one billion people, African leaders must shift focus and use regional instruments like AfCFTA to build and insulate the continent's economy,' he told RT.
According to the expert, by imposing new trade tariffs on African exports, 'Trump did Africa a big favor.'
Launched in 2021, the AfCFTA boasts an estimated combined GDP of $3.4 trillion and a market of 1.4 billion people, making it the world's largest free trade area by number of participating countries.
But despite the existence of the AfCFTA, intra-African trade remains below par. As of April 2025, it accounted for only 18% of total continental trade.
According to Afreximbank's Africa Trade Report 2024, intra-African trade in 2023 was $192.2 billion, a 3.2% increase from the previous year. In the same year, the share of formal intra-African trade increased from 13.6% in 2022 to 14.9%. Projections by the UN Economic Commission show that a full implementation of the AfCFTA could push intra-African trade to 35% by 2045.
Faith Atieno, a trade policy analyst with Kenya's Institute of Economic Affairs, argues that a lack of political will and trust among member states has hampered the full implementation of the AfCFTA.
'Africa must address existing structural barriers and disjointed customs regulations if it wants to realize its full trade potential,' Atieno told RT.
She added that to unlock its dormant trade power, the continent should also invest in the enhancement of its industrial capacity and logistics infrastructure.
'For AfCFTA to succeed, Africa must start trading as a continent and invest in regional value chains. Member states must stop prioritizing trade deals with Europe and the US,' she said.
According to Atieno, there is no reason why a country like Kenya cannot export its textiles and horticultural products to countries like Nigeria, Egypt, and Ghana. 'Why should African nations continue having trade barriers among themselves when they can all benefit from this ripe and huge market?'
In the wake of Trump's actions, African countries are taking insulating measures. In Nigeria, the Export Promotion Council has already announced a new policy to ease bureaucratic barriers and enhance intra-African trade for its textiles, cocoa, and pharmaceutical products.
Regarded as Africa's largest economy, Nigeria is among the member states that have lagged in the implementation of the AfCFTA.
On the other hand, Ghana, through the Ghana Export Promotion Authority, is prioritizing intra-African trade in the implementation of the National Export Development Strategy, which aims to create a $25 billion export economy by 2029.
Yodit Hailemariam, a development economist based in Addis Ababa, says Africa's trade and economic future rests in regional integration.
'As a continent, we have a promising future. Regional integration must now move from theory to reality. Regional blocs must start aligning their industrial and trade policies for intra-African trade to be effective and beneficial,' she told RT. 'For AfCFTA to succeed, we will need strong and powerful regional and continental value chains.'
Afreximbank already has a $2 billion Intra-African Trade Resilience Fund to help exporters build continental logistics hubs to boost intra-continental trade.
And with the African Union set to host an emergency trade summit in August 2025 in Nairobi to discuss unified responses to global trade shocks, Dr. Owusu says Trump's tariffs on African countries are a 'statement of economic freedom and independence for the continent.'
A 2022 research report published by the World Bank Group forecasted that full implementation of the AfCFTA could lift at least 50 million Africans out of extreme poverty by 2035.
Wamkele Mene, who heads the AfCFTA secretariat, says that to fully benefit from the protocol, member states need to focus on innovation and economic development, which requires the integration of government, industry, and academia to foster innovation and economic development.
'We urgently must address existing challenges to continental trade, enhance trade capabilities and develop sector-specific technologies,' Mene said. 'What we need are policies that promote intra-African trade and cooperation, tax incentives as a catalyst for propelling Africa towards greater economic integration.'
Mene says that through the AfCFTA, Africa has a chance to accelerate the realization of the African Union Agenda 2030 goals and try to establish a sustainable economic foundation for future generations.