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Africa can’t outrun the Trump typhoon

The US president’s disruption of global norms has confused, alarmed and potentially devastated other nations – none more than those in Africa, the world’s least developed region. By Mike Moon

“Trade, not aid, is now the pillar of our policy in Africa.” That was the message from Troy Fitrell, the US State Department’s top Africa official.

The slashing of US aid to developing countries came on Day 1 of Donald Trump’s second term as US president, with the rapid shrinking of the US Agency for International Development (USAID), a vehicle for delivering assistance to the world’s poor since the 1960s. It came without warning, destroying many welfare projects in African nations, in particular.

Foreign aid is a contentious issue among all shades of political opinion. But it has been a permanent feature of the West’s liberal democratic consensus for decades, arguably fostering peace and friendship and inarguably doing some humanitarian good, particularly in healthcare.

The President’s Emergency Plan for AIDS Relief (Pepfar), a global initiative to combat HIV/AIDS, is credited with saving 26 million lives and preventing five million children from contracting HIV – primarily in Africa.

South Africa’s HIV work gets 17% of its funding from Pepfar, while Democratic Republic of Congo, Mozambique and Zambia get more than half their medicines from it and Tanzania and Côte d’Ivoire more than 90%.

“The programme has lived up to its promise,” reports The Conversation. “The investment of over $110 billion since being launched (in 2003) has been transformative, with sub-Saharan Africa benefiting the most.”

Pepfar directly supported more than 340,000 health workers and was “focused on 12 high-burden countries in sub-Saharan Africa”.

In 2023, USAID’s budget was $40 billion, which was over half the US government’s total foreign aid spend of $68 billion. The latter figure is 0.6% of total US government spending. In 2023, USAID gave $12.1 billion to sub-Saharan Africa, mainly for healthcare, food assistance and security.

That kind of money is not replaceable in short order. Possible alternative sources of aid are mentioned, but so far there are no concrete offers.

Hardly had the aid cuts registered, when Trump unveiled his unprecedented series of trade tariffs on countries around the world – putting hard-won free-trade mechanisms under threat.

The statement above, about aid and trade, by Troy Fitrell, came in a speech in mid-May in Abidjan, Côte d’Ivoire. Some in the audience were confused as, by then, Trump had pulled the rug from trade as well as from aid.

The New York Times reported that minutes after Fitrell finished speaking, US and Ivorian companies signed more than half a dozen deals to cover some of the expected shortfalls in both aid from, and trade with, the US.

In early April Trump announced most countries would face a 10% “baseline” tariff – or import tax – on all goods sent to the US. Much higher tariffs were placed on about 60 countries, described as the “worst offenders” among America’s trading partners. Trump said these countries were taking advantage of the US by running trade surpluses with it.

His stated aim is to reduce the US’s budget deficit and rebuild the country’s manufacturing capacity, thus creating jobs and strengthening national security.

These “reciprocal tariffs” seem to have swept away the African Growth and Opportunity Act (Agoa), which gives non-reciprocal, duty-free access to the lucrative US market for exports from 32 eligible sub-Saharan countries. Agoa, aimed at boosting growth and democracy, has been in place for 25 years and has been well used by the likes of South Africa, Madagascar and Eswatini. But Agoa’s very success has landed some beneficiaries in economic trouble.

Lesotho was hit with the highest tariff in the world outside China: 50%. Madagascar got 47%, Mauritius 40% and South Africa 31%. Kenya, escaped with the minimum tariff of 10%.

Lesotho exported $237 million-worth of goods to the US in 2024 – textiles under Agoa and diamonds. The tiny country with a small, impoverished population imported goods worth $2.8 million from the US.

That created a relatively large trade deficit, which the Trump algorithm construed as taking unfair advantage. Lesotho Trade Minister Mokhethi Shelile told the Institute of Strategic Studies a 50% tax would close 11 factories – mainly making Levi jeans and the golf gear Trump uses – and cost 12,000 jobs.

Such absurdities and disruptions hit the markets. Stock exchanges plunged and bond markets uncharacteristically shivered.

Trump quickly announced a 90-day pause on implementation – officially to allow countries to plead their cases for lesser tariffs, but which the media insisted was forced by the market reaction.

The 90 days are up on 9 July, after which tariffs will be adjusted according to US dictate. The 10% across-the-board will still apply.

Diplomatic delegations are swarming Washington airport, arguments at the ready. Some bilateral trade agreements have been reached, notably with the UK and in Africa with Rwanda and Angola.

But the question remains: how do countries respond if pleas fall on deaf ears. African economies are not strong enough to retaliate in a trade war – as China and the EU initially did.

A search for other destinations for African goods is on, with China, the EU and Southeast Asia suggested. But, with the Chinese economy currently in broad withdrawal mode and the International Monetary Fund predicting imminent global recession, there aren’t quick fixes.

Using the nascent African Continental Free Trade Area, to boost inter-African trade, sounds a good idea. But this ambitious initiative has been slow to gain momentum – due to ingrained protectionism and political special interest in various countries.

If impediments are swept away, Africans could become their new best friends, so to speak.

When Botswana recently lifted a ban on fresh produce imports from South Africa, Mmatlou Kalaba, a senior analyst at the Bureau for Food and Agricultural Policy, said the move was some consolation for Trump’s 31% tariff on imports from South Africa. It was at least an example.

The country’s agriculture sector – along with its automotive manufacturing industry – is likely to be among the hardest-hit.

“Anything that actually reduces that kind of stress is welcome… there are many uncertainties that are yet to come,” Kabala said.

The effects of losing tariff-free trade with the US were demonstrated when Ethiopia was suspended from Agoa in 2022, due to the conflict in Tigray.

Eighteen foreign companies left the country, over 11,500 jobs were lost – mainly in the garment and leatherwork sectors, according to a new report by the National Bank of Ethiopia.

The bank reported some resilience and recovery in the economy, with the World Bank and the UN helping craft a post-war reconstruction plan, but the importance of Agoa was shown by the country’s repeated attempts to rejoin the programme.

Ironically, the demise of Agoa might afford Ethiopia a chance at a securing a different, lucrative trade deal with the Trump administration.

But, for all African countries, uncertainty is the new normal. At least until 9 July.

May 2025

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