Indian Council of World Affairs

Abstract: The United States' trade protectionist policies have served as an awakening for Africa, disproportionately affecting the countries. Notwithstanding, Africa’s response prompted negotiations over retaliation. Can this challenge serve as an opportunity for Africa to achieve economic self-reliance?

On 2 April 2025, the President of the United States, Donald Trump, declared “Liberation Day” for the country, announcing reciprocal tariffs on its imports worldwide, which were causing the US a trade deficit. These tariffs significantly impacted Sub-Saharan Africa, originally varying from a minimum of 10% to a maximum of 50%, disproportionately affecting 52 out of 54 countries, excluding Burkina Faso and Seychelles.[i] Although the tariffs have been suspended for 90 days, a 10% threshold applies to all countries - except China. This is framed as a tactical recalibration.[ii] The US’ stance of “America First” has deprived Africa of its right to development, as these tariffs practically nullified[iii] the benefits of the US-sponsored non-reciprocal trade programme, the African Growth and Opportunity Act (AGOA). The US protectionist move came amidst Africa fathoming out President Trump’s previous executive order of 20 January 2025 for a 90-day pause on the United States Agency for International Development (USAID) to Africa, having further extended by 30 days till May 2025.[iv] This paper assesses the simultaneous double burden on Africa and the degree of implications for its growth trajectory. In addition, what is Africa’s approach towards dealing with this challenge, and is it ready to revisit its intra-continental policies for a unified stance to fulfil its objective of self-reliance?

Double Economic Impact on Africa

The US tariffs are projected to impact Lesotho, Mauritius, Madagascar and South Africa the most, despite the 90-day pause. For instance, a small country like Lesotho, originally subjected to a 50% tariff, depends exclusively on its textile exports to the US via AGOA, contributing 10% to its GDP with $237.3 million in exports in 2024 alone. Even an updated tariff at 10% will prove devastating for a country of such size. Similarly, Madagascar’s exports to the US amounted to $733.2 million in 2024. Ironically, the US has penalised African countries for benefiting from AGOA, contradicting its original goal. AGOA was meant to boost Africa’s industrial growth by offering duty-free access to the US market, helping the continent shift from aid to trade and become a manufacturing hub, while strengthening US-Africa ties. Moreover, these tariffs specifically exclude the exports of natural resources, including certain critical minerals, to the US. This reflects President Trump’s realpolitik, inundating Africa with the historical neo-colonialist extractivism that disregards value addition to the African market, further exacerbated by the USAID cuts. While the exclusive exemption may offer a reprieve for the mineral-rich countries, South Africa is disproportionately impacted by the US-led sweeping 25% tariffs on globally imported automobiles, auto parts, steel and aluminium, which is in addition to the 10% cap, tailored to the US domestic realignments. The US is South Africa’s third-largest automobile export market, accounting for approximately $1.8 billion annually. As consumer demand for cars declines in the US due to the high costs, South African car exports are likely to suffer, thus reducing the demand for the exports of Platinum Group Metals (PGMs) – critical minerals used in vehicle components like car exhaust systems.[v] This doubles the country’s burden with reduced car and PGM exports, impacting South Africa’s mining sector, already battling energy insecurity and unemployment. In addition, South African exports pose no real threat to the US domestic industries, representing only 0.99% of total US automobile imports and a mere 0.27% of auto parts.[vi] This makes the tariffs appear more political than protective, underscoring the disproportionate nature of the policy. Moreover, President Trump’s “worst offenders” list, extending to other countries under the AGOA, such as Botswana, Namibia, etc., face the looming uncertainty of being subjected to the original tariffs once the 90-day pause is over. The disproportional tariffs have led President Trump to strategically assert power, using trade leverage not for economic protection, but to reshape negotiation dynamics in Washington’s favour.

Africa’s burden persists, given the uncertainty of the renewal of the AGOA, due in September 2025, has worsened the already suspended USAID, causing deep scars on the continent. While 100% funding for the private sector, higher education and political consensus building has been terminated, 90% or more cuts have been witnessed in sectors including infrastructure, good governance, basic education, family planning, civil society, conflict mitigation and trade and investment.[vii] Another vital energy sector has been disrupted on the continent, where 600 million people lack access to electricity. For instance, the US-launched Power Africa programme in 2013 to boost affordable energy access for Africa, also partnered with the African Development Bank (AfDB), has already generated 9,000 MW of new and affordable electricity. The initiative, also responsible for cutting 45 million tons of carbon emissions, has been terminated after questioning its efficacy and inconsistent data collection. In addition, the US withdrawal from the Just Energy Transition Partnerships to transition global polluters, which included South Africa and Senegal, has put another block in  Africa’s path towards sustainable energy transition.[viii] A popular argument defending the suspension states that the real impact of aid is far less than what is reflected on paper. Therefore, if it were to stop, it might not significantly affect Africa, as much of the funding was already being lost to inefficiencies and overhead.[ix] However, since the beginning of the aid pause, at least eight African countries have been facing health and humanitarian crises, including Ethiopia, the DRC, Somalia, South Africa, Uganda, South Sudan and Nigeria.[x] The African analysts, thus, argue that it is a wake-up call for Africa to look within to strengthen itself, negotiate and diversify trade to fulfil its interests in the short term while building domestic and regional capacities in the long run.   

Africa’s Response

The US tariffs and developmental aid cuts have made Africa adopt a pragmatic, introspective approach to reassess its development trajectory instead of retaliation. With limited room to manoeuvre due to high import dependency, African countries recognise the need to pivot from outdated models of aid dependency to self-reliance through resource leverage, value addition and disciplined investment strategies. This was notably articulated by the African Development Bank (AfDB) President Akinwumi Adesina during his remarks at the National Open University of Nigeria, where he stressed the urgency for Africa to redefine its development paradigm.[xi] Notwithstanding, Africa continues to engage constructively with the US, acknowledging the continued relevance of its development aid for many sectors. The Southern African Development Community (SADC) remains a key actor in this evolving scenario, committed to transparent and constructive engagements with multilateral stakeholders. Currently, all SADC members except Zimbabwe and Seychelles benefit from the AGOA. With the agreement up for renewal in September 2025, the bloc is recalibrating its trade strategy in response to growing uncertainty about the future of AGOA.[xii]

In the short term, African countries have adopted a unified non-retaliatory stance but differ in their engagement strategies. South Africa, the region’s economic powerhouse and one of the most affected by the US tariffs, has appointed a special envoy to Washington to address persistent bilateral trade issues. Lesotho has advocated for trade continuity by negotiating wheat supply deals while offering the US stakes in power generation projects in return.[xiii] It has also granted a ten-year operating lease to Elon Musk’s Starlink satellite services on its territory.[xiv] While Madagascar’s trade minister has expressed cautious optimism about the renewal of AGOA, Kenya is actively benchmarking its textile industry against global competitors and has sent a delegation to the US to bolster trade relations. In contrast, Zimbabwe became the first country to completely remove tariffs on American imports, without considering negotiating, as it seeks to rekindle its trade ties with the US. This move has been criticised for diverging from a pan-African strategy grounded in shared values and intra-regional solidarity.[xv] Such divergence underscores the difficulty of forging a unified African stance in trade negotiations at a time when collective bargaining is critical for advancing the continent’s intra-regional trade and economic sovereignty.

Looking to the medium and long term, Africa is determined to build economic resilience and reduce dependence on external powers. The AfCFTA Secretary-General, Wamkele Mene, has framed the US tariffs as a timely prompt for Africa to consolidate its internal economic strength. Notably, Africa’s export basket to the US under AGOA is increasingly composed of value-added goods, not merely raw materials, signalling a shift in the continent’s economic landscape. Rather than viewing the 10% US tariff as purely punitive, it may be more productive to regard it as an opportunity for Africa to stand more self-reliantly.[xvi] In this direction, a Memorandum of Understanding (MoU) was signed between AfCFTA and the US-based National Bar Association (NBA) on 17 April 2025 to enhance Africa’s capacity in trade-related legal frameworks, dispute resolution and investment facilitation, particularly through its diaspora networks. It represents a constructive path forward for aligning with like-minded institutions to enhance Africa’s institutional capacity to negotiate from a position of strength.[xvii]

Although the African regional blocs advocate for a coordinated response, the differing national interests and levels of economic dependence on external actors, particularly the US, make alignment complex. Nonetheless, many African countries recognise the strategic imperative to diversify their economic partnerships to leverage their bargaining power while strengthening themselves domestically. Namibia offers a compelling case in point as it is reforming its trade policy by merging its Ministry of International Relations and Cooperation with its trade ministry.[xviii] This cross-ministerial approach can serve as a step towards improving commercial diplomacy and diversifying international economic relations. Yet, this diversification is a long-term goal rather than an immediate option, especially for smaller, aid-dependent economies such as Lesotho, whose economic survival remains closely tied to US market access and development assistance. In the meantime, there is a dire need for intra-trade on the continent, particularly in the face of rising global trade protectionism. African trade ministers, therefore, met in the DRC for the 16th Council of Trade Ministers of the AfCFTA to agree on fast-tracking policies for promoting trade within the continent.[xix] Afreximbank reports that intra-African trade grew by 7.7% in 2024. As a result of the continuous implementation of the AfCFTA, intra-continental trade is expected to rise by 6.6% between 2025 and 2028.[xx] The biggest economies in Africa, notably South Africa, Egypt, Nigeria and Ivory Coast, have known to profit from the world's largest free trade area agreement. Further, resource-rich nations such as Morocco, Algeria, Angola and Libya have the potential to emerge as major players in intracontinental trade. At the regional level, Southern Africa led the continent in 2024, followed by West and East Africa, indicating the continent’s growing economic connectivity. Notwithstanding hurdles, such as the looming conflicts of the Great Lakes, Sahel and Horn of Africa and a lack of consensus-based trade policies, cross-border barriers and infrastructural deficits need to be addressed.[xxi] Linkages and integration within the continent need focused attention for the overall well-being of Africa, rather than the lure of linkages to former colonial powers and other external linkages.

Conclusion

The “America First” narrative-led US tariffs and aid cuts have imposed a dual burden on Africa, undermining the benefits of AGOA and disrupting critical development, USAID. While the 90-day tariff pause offers temporary relief, the long-term uncertainty highlights Africa’s vulnerability to external policy shifts. In response, African nations are adopting pragmatic strategies, engaging diplomatically with the US, accelerating intra-continental trade through AfCFTA and prioritising economic self-reliance. However, disparities in national interests and dependencies complicate a unified stance. The current crisis catalyses the continent to redefine its future. Moving forward, Africa must leverage its resources, strengthen regional integration and diversify partnerships to build resilience against global protectionism and secure its developmental sovereignty. India presents a strategic opportunity, given its strong trade relationship with Africa as the third-largest trading partner. This relationship can be further strengthened by leveraging AfCFTA-India ties to play a central role in connectivity, resolving trade barriers and creating more investments for integrated value chains.

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*Nandini Khandelwal, Research Intern, Indian Council of World Affairs, New Delhi
Disclaimer: Views expressed are personal. 

Endnotes

[i] Amegashie, Marvin. 2025. “US Blanket Tariffs: An Opportunity to Promote Intra-African Trade - Concerto.” Concerto. April 28, 2025. https://concertopr.com/en/2025/04/us-blanket-tariffs-an-opportunity-to-promote-intra-african-trade/.

[ii] Witherspoon, Andrew. 2025. “Full List of Trump’s Tariffs: A Country-By-Country Look after the 90-Day Pause.” The Guardian. April 9, 2025. https://www.theguardian.com/us-news/2025/apr/09/trump-tariffs-list-pause.

[iii] Fabricius, Peter. 2025. “‘Agoa Is Dead’: Africa Braces for Full Impact of Trump’s Trade Tariffs.” Daily Maverick. April 13, 2025. https://www.dailymaverick.co.za/article/2025-04-13-agoa-is-dead-africa-braces-for-full-impact-of-trumps-trade-tariffs/.

[iv] Schraer, Rachel. 2025. “Trump’s Deadline to Review US Aid Cuts Has Passed – so What Happens Now?” The Independent. April 26, 2025. https://www.independent.co.uk/news/health/trump-us-aid-cuts-explained-latest-b2739509.html.

[v] “Media Statement.” 2025. Mineral Council South Africa. April 2025. https://www.mineralscouncil.org.za/component/jdownloads/?task=download.send&id=2460:key-south-african-mineral-exports-to-the-us-excluded-from-damaging-tariffs&catid=127&m=0#:~:text=The%20Minerals%20Council%20notes%20that,specifically%20excluded%20from%20the%20tariffs.

[vi] Kulkarni, Pavan. 2025. “‘We Should Not Negotiate with a Begging Bowl’: South Africa’s Auto-Industry Leader on Trump’s Tariff War: Peoples Dispatch.” Peoples Dispatch. April 28, 2025. https://peoplesdispatch.org/2025/04/28/we-should-not-negotiate-with-a-begging-bowl-south-africas-auto-industry-leader-on-trumps-tariff-war/.

[vii] Conroy, Erin , and Julian Pecquet. 2025. “Trump Dismantles USAID: The Country-By-Country Breakdown - the Africa Report.com.” The Africa Report. April 4, 2025. https://www.theafricareport.com/380618/trumps-africa-aid-cuts-the-country-by-country-breakdown/.

[viii] Harrisberg, Kim. 2025. “USAID Cuts Hurt Debated Energy Plans in Africa.” Context. April 22, 2025. https://www.context.news/just-transition/usaid-cuts-hurt-debated-energy-plans-in-africa.

[ix] Okafor, Chinedu. 2025. “US Funding Is Not as Important as Africans Have Been Told - Caitlin Burton.” Business Insider Africa. March 21, 2025. https://africa.businessinsider.com/local/markets/exclusive-us-funding-is-not-as-important-as-africans-have-been-told-caitlin-burton/k2c5x10.

[x] Ekanem, Solomon. 2025. “Trump’s 90-Day Aid Pause Ends but Leaves 8 African Nations Facing a Growing Health Crisis.” Business Insider Africa. April 28, 2025. https://africa.businessinsider.com/local/lifestyle/trumps-90-day-aid-pause-ends-but-leaves-8-african-nations-facing-a-growing-health/kenke82.

[xi] “The Era of Aid or Free Money Is Gone. Africa Must Overhaul Its Approach toward Achieving Fast-Paced Development.”. African Development Bank Group. April 12, 2025. https://www.afdb.org/en/news-and-events/press-releases/era-aid-or-free-money-gone-africa-must-overhaul-its-approach-toward-achieving-fast-paced-development-82827.

[xii] Kitsepile Nyathi. 2025. “SADC Economies Face Uncertainty as Trump Tariffs Bite.” The EastAfrican. April 22, 2025. https://www.theeastafrican.co.ke/tea/business-tech/sadc-economies-face-uncertainty-as-trump-tariffs-bite-5012096.

[xiii] Jitendra Bhonsle. 2025. “Impact of Trump’s Tariffs & Suspension of AGOA on African Countries.” Marine Insight. May 7, 2025. https://www.marineinsight.com/maritime-law/impact-of-trumps-tariffs-suspension-of-agoa-on-african-countries/.

[xiv] Songwe, Vera, and Witney Schneidman. 2025. “How Africa Should Negotiate with Trump.” Project Syndicate. May 5, 2025. https://www.project-syndicate.org/commentary/africa-negotiate-critical-minerals-deals-with-trump-administration-by-vera-songwe-and-witney-schneidman-2025-05.

[xv] Op.cit.xii

[xvi] Etefe, Juliet. 2025. “U.S. Tariffs a Wake-up Call for Africa’s Economic Self-Reliance – AfCFTA Chief.” The Business & Financial Times. April 10, 2025. https://thebftonline.com/2025/04/10/u-s-tariffs-a-wake-up-call-for-africas-economic-self-reliance-afcfta-chief/.

[xvii] Ibid.

[xviii] “Africa’s Trade Winds Shift amid Tariffs, Reforms, and Regional Tensions.” 2025. Africanews. April 2, 2025. https://www.africanews.com/2025/04/10/africas-trade-winds-shift-amid-tariffs-reforms-and-regional-tensions-business-africa/.

[xix] Ocamringa, Chris. 2025. “Ministers Agree to Promote Trade within Africa.” SABC News. April 15, 2025. https://www.sabcnews.com/sabcnews/african-trade-ministers-aim-to-promote-trade-within-the-continent/.

[xx] Op.cit.i

[xxi] Op.cit.i