Head of Sub-Saharan Africa at Citigroup, Akin Dawodu, has said that the new U.S. tariffs on African imports could accelerate the continent’s pivot toward alternative global trade partners.
In a revised global trade plan announced Thursday, former U.S. President Donald Trump imposed fresh tariffs of up to 30% on goods from countries including South Africa and Algeria.
Nigeria and Ghana were also hit with 15% tariffs, signaling a tougher U.S. stance that may further marginalize Africa in American trade flows.
Dawodu, speaking in an interview in Johannesburg, said the tariffs could prompt African governments to deepen economic ties with other regions.
“China is already Africa’s biggest trading partner, and the European Union is second. This trend could accelerate,” he said, adding that the Middle East is also becoming a significant player, particularly in food security partnerships.
Africa’s mineral reserves
According to Dawodu, Africa’s vast resources, holding about 60% of the world’s remaining arable land and a third of its mineral reserves, make it strategically important for future industries, including those supporting artificial intelligence.
Yet, the continent still accounts for less than 2% of U.S. trade, Dawodu noted.
“There are global markets for those commodities, so they can be routed to other markets,” he said, underscoring Africa’s options in a shifting global trade landscape.
- For long-term resilience, Dawodu stressed the importance of intra-African trade. He called on governments to address non-tariff barriers such as inconsistent legal frameworks, poor logistics, and restrictions on labor mobility.
- He also emphasized the role of the African Continental Free Trade Area (AfCFTA) in boosting regional commerce.
“If properly implemented, AfCFTA could raise Africa’s share of global exports to 4.4% by 2043, up from 3.5% under current conditions,” Dawodu said.
Despite the near-term disruption caused by Trump’s tariff regime, Citi remains optimistic about Africa’s long-term prospects.
“We believe a lot of Africa’s economic growth will be driven by demographics and domestic demand. That’s a factor that will trump no pun intended tariffs,” Dawodu added.
What you should know
Earlier, Afrieximbank Research had stated that President Trump’s reciprocal tariffs might have a limited direct impact on African economies, given the continent’s deepening trade ties with China.
The organization in its analysis of the tariff issue, noted that recent trade data had revealed a major shift in Africa’s global economic alliances, with China surpassing the United States as the continent’s leading trading partner.
“Over the past two decades, African nations have increasingly relied on China for both exports and imports, reducing their direct exposure to U.S. trade policies.
“This growing trade between China and Africa implies that recent U.S. reciprocal tariffs may have less direct impact on Africa,” it said.
- According to Afreximbank, the more pressing concern for Africa lies in the potential spillover effects of a prolonged U.S.-China trade war.
- It warned that if these tensions contribute to a sustained slowdown in China’s economy, African commodity exporters could face severe challenges.
- The bank pointed out that China remains the primary buyer of Africa’s key exports, including crude oil (Nigeria, Angola), copper (Zambia), cobalt (DRC), and agricultural products.
