Conrad Onyango, Bird Story Agency…
African countries are hinting at diversifying trade relations in reaction to U.S. President Donald Trump’s ‘reciprocal tariffs’, which impose some of the highest import rates on some of the smallest countries in Africa.
South Africa, facing a 30% export tax, is advocating for a new trade agreement with the White House as it aims to diversify its trade, looking to engage more with African markets.
South African Trade, Industry and Competition Minister Parks Tau told Journalists on the Sidelines of the Guateng Investment Conference that the African Continental Free Trade Area (AfCFTA) and regional trading blocs serve as important stepping stones for diversifying the country’s trade.
Formation of a ‘coalition of the wounded’, especially countries in the Southern Africa, he said would enhance trade in the African continent.
“The reality is that we now have to look amongst ourselves and say within the customs union in Southern Africa, within the SADC and the region of Africa, how are we going to respond to these issues? And part of our reality is the greater inclination for cooperation and collaboration,” said Tau.
Lesotho, a small southern Africa country which Trump had described as ‘ a country that nobody knows’ got another spotlight – hit with the World’s second highest trade rate of 50% and branded among, ‘Countries that treat US badly.’
“If you think about it, the tariff decisions that have been made impact on us, but it also impacts on, amongst others, the least developed countries. If you think about Lesotho and the tariff that has been imposed on them, it literally will devastate Lesotho,” explained Tau.
Other Southern African countries slapped with among the world’s highest tariffs are Madagascar (47%), Mauritius (40%), and Botswana(37%).
Independent Continental Youth Advisory Council on AfCFTA (ICOYACA), Acting Secretary General, Anele Simon share similar sentiments with that of the South African trade minister, saying Lesotho tariffs offer a sobering lesson: Africa must look inward for sustainable growth, industrialisation and trade resilience.
According to Simon, with a combined market of over 1.3 billion people, the AfCFTA offers Africa the chance to scale local industries, retain value chains, and shield itself from geopolitical shocks.
“Strengthening intra-African trade, investing in regional value chains and speaking with one voice in global trade forums are no longer aspirational goals – they are urgent priorities,” said Simon.
During the 57th session of the Conference of African Ministers of Finance, Planning and Economic Development in Addis Ababa, Ethiopia, AfCFTA Secretariat, secretary general Wamkele Mene, stressed the need for full implementation of Africa’s largest single market, the African Continental Free Trade Agrement.
“The immediate implementation of the AfCFTA is crucial in the face of global geopolitical tensions, including the ongoing war in Ukraine and conflicts in the Middle East, which have heightened political uncertainty, restricted investment, and kept interest rates high,” said Mene.
Kenya is looking to take the advantages of its 10% rate, the baseline tariff, to snap up more US deals including from competitors by ramping up value addition in its manufacturing sector.
Kenya said that while its exporters will face a 10% rate hike in the U.S market, the baseline tariff is significantly lower compared to its Asian competitors like Vietnam, Sri Lanka, and Bangladesh, giving it a huge opportunity to strengthen its position in international trade.
“With other textile-exporting countries facing much higher tariffs, Kenya could become an alternative sourcing hub for U.S. buyers,” said Kenya’s Trade and Investments Cabinet Secretary, Lee Kinyanjui.
To firm up its new projected position, however, Kenya is looking to move beyond textiles to expanding its manufacturing base through value addition to ‘attract businesses looking for cost-effective suppliers.’
“We must explore opportunities to expand our manufacturing base. With higher tariffs making goods from other countries more expensive, Kenyan industries — especially in apparel, leather, and agro-processing—can fill the gap and benefit from increased demand,” he said in statement.
While Tax experts at PricewaterhouseCoopers (PwC) have described the US tariff policies as a drastic shift in the global trade landscape, they urged Kenya to continue pursuing the Kenya-US Strategic Trade and Investment Partnership (STIP) to secure bilateral trade benefits wherever feasible.
“In the short to medium term, Kenya should accelerate efforts to leverage this opportunity to increase export volumes to the US where competitor countries face higher tariffs,” said the experts in a tax alert note.
For nearly 25 years, many African countries have been utilizing the African Growth and Opportunity Act (AGOA), which has played a crucial role in U.S. economic policy towards Africa- primarily facilitating the export of textiles, apparel, and certain agricultural products.
However, AGOA is set to expire on September 30, 2025, and the possibility of its renewal is uncertain.
ICOYACA said the latest US government tariffs now cast a long shadow over AGOA and raise urgent questions about the reliability of unilateral trade preferences as a foundation for African development.
“If a least-developed country like Lesotho can be targeted with such punitive measures despite meeting eligibility criteria, what security do other African countries have in their trade arrangements with major economies?” Simon paused.
PwC Tax experts however argues that AGOA offers unilateral trade preferences without requiring reciprocal tariffs. The Executive Order, they said introduces tariffs on imports under existing US trade agreements but does not specifically mention AGOA.
“We expect that implementing instructions from US Customs and Border Protection will clarify the operational details of the Executive Order and provide essential guidance on how the new tariff measures will be applied to imported goods, including under AGOA,” said the experts.
bird story agency.
