Outgoing president of the African Development Bank (AfDB) Dr. Akinwumi Adesina has warned that Washington’s new tariff regime could trigger “significant economic disruptions across Africa.”
- •Africa accounts for only 1.2% (approximately $34 billion) of America’s global trade—with a trade surplus of $7.2 billion.
- •At least 22 nations face up to 50% tariffs for their products, with some of the hardest hit being Lesotho, Madagascar, Mauritius, Botswana, Angola, Algeria, and South Africa.
- •47 out of the continent’s 54 countries will be impacted directly by the new US trade policies, with potential declines in export revenues and foreign exchange reserves.
“When those currencies weaken, two things will happen: first, you will find that most of these countries are import-dependent. So, you’re going to find that high inflation becomes a problem,” Adesina said during an interview with CNN’s Christiane Amanpour. “And secondly, you find that the cost of actually servicing a lot of their debt, which is foreign currency debt, but in local currencies, is going to get worse.”
According to Dr. Adesina, the impacts of these higher tariffs are further exacerbated by significant cuts to USAID programs, which have already begun affecting access to essential medical supplies and humanitarian services in many countries.
The AfDB President, whose final term ends in September, is proposing that Africa engage the US in “flexible and constructive trade negotiations.” He is also pushing for more export market diversification, and the acceleration of the African Continental Free Trade Area which could unlock a potential US$ 3.4 trillion market.
Despite the challenges, Dr. Adesina is confident that Africa will remain an attractive place to invest, terming it “the investor’s dream.”
“We got hydropower. We have a massive youth population that can become the labor force of the world. Sixty-five percent of the arable land left in the world to feed almost 9.5 billion people by 2050 is in Africa, so what Africa does with it will determine the future of food in the world,” he said.
