By Alexander Parker
With just days to go until the US is due to impose punishing new tariffs on imports, not a single African nation has clinched a deal with Washington to soften the impact.
The new dispensation aims to give effect to President Donald Trump’s pledge to reset relations between America and Africa by pivoting from aid to trade.
Trump has been as good as his word with regard to halting most handouts to the least-developed region, bringing key healthcare initiatives and other programs to a halt.
But instead of clearing a path for African exporters to do more business with the world’s biggest economy, he appears intent on doing just the opposite.
Trump has effectively scrapped the 25-year-old African Growth and Opportunity Act, which was endorsed by Congress and enabled thousands of products from more than 30 countries to enter the US duty free.
The new levies will place billions of dollars of exports — and the jobs they support — at risk.
African nations are banking on Washington granting them reprieves so accords can be agreed that don’t decimate their economies. While the US leader is notoriously unpredictable and may yield some ground, there are no guarantees negotiations will deliver a favorable outcome.
South Africa, which has the continent’s biggest economy and a fraught relationship with the Trump administration, is bracing for the worst. It shipped more than $4 billion’s worth of Mercedes-Benzes, oranges and other goods to the US last year that qualified for preferential access under AGOA.
President Cyril Ramaphosa struck a resigned tone in his weekly newsletter, warning that steps must be taken to protect existing jobs from the fallout of the trade war, which has already hammered vehicle shipments.
“The need to diversify our export base has become all the greater,” he wrote.
With so much at stake, the next few weeks will be crucial.
BLOOMBERG
