African trade policies in Mr Trump’s world

G20 leaders and their G7 antecedents have long concurred that Africa, as the continent with the highest concentration of least developed countries, needs concerted development assistance. On the trade front this has extended to generous preferential market access arrangements such as the US African Growth and Opportunities Act. 

However, by the end of September 2025 American preferential tariff treatment for African countries ended. Moreover, under US president Donald Trump, the US is charging ‘reciprocal’ tariffs on African countries. Some of the poorest countries face the highest tariffs set by the US administration.

Although this reversal is serious, the African Continental Free Trade Area can help African countries to deepen and broaden their trade among themselves. In addition, partners from outside Africa such as the European Union, all subject to US tariffs, could see opportunities for strengthening trade and investment relations with Africa. 

What are the likely impacts of the new direction of US trade policy on Africa economies? What is the
AfCFTA’s progress and what key tasks remain? How can G20 leaders best help?

Implications of Mr Trump’s reciprocal tariffs

Starting on 2 April this year, the US administration charged so-called reciprocal tariffs on African countries, culminating in a spike of 47% for Madagascar. Currently 18 African countries face 15% tariffs; 32 countries face 10%; Algeria, Libya and South Africa are charged 30% respectively; and Tunisia faces 25%. Many commodities, for example petroleum, critical minerals, metals, certain chemicals and energy products, have been exempted, which shows that the US still behaves like most industrialised countries – tariff escalation is meant to protect domestic added value.

This is likely to be amplified by the negative long-term implications of the erosion of trade policy norms and the multilateral trading system.

The short-term implications for African businesses exporting
value-added goods are serious. Given AGOA’s limited success with creating industrial capacity in Africa this is ironic. Countries that created a manufacturing sector dedicated to exporting to the US, such as South Africa’s wine and car industry and Lesotho’s jeans factories, will suffer reduced exports and job losses.

The answer for African governments is obvious: diversify. One avenue already pursued by  South Africa is to align closer to the BRICS+ community, notwithstanding difficulties with accessing some of those markets. Other countries will follow. Another option is to move closer to the European Union, but that requires the EU to be willing to seize this chance. The natural option is to engage in more intense intra- African trade.

The AfCFTA’s progress

The foundation of the AfCFTA led to the largest free trade area in the world, comprising 54 states. The start six years ago was promising, but limited progress has since been made. One reason is that the negotiations about rules of origin are complicated, against the background of eight regional economic communities. Considering these difficulties, eight countries started the Guided Trade Initiative in 2022. More than 30 countries are interested in joining. 

Intra-African trade consists mainly of manufacturing, whereas most African exports to the rest of the world are commodities. Given the end of both AGOA and USAID support for Africa, the AfCFTA can provide a key to deepen intra-African relations and boost industrialisation. African governments should use this wake-up call from Washington to fix the AfCFTA and get it working. 

Can G20 leaders help?

South Africa has the 2025 G20 presidency, hosting the Johannesburg Summit in November. The US, which will send Vice-President JD Vance to participate at the Johannesburg Summit, has already stated its intention not to convene G20 trade ministers when it takes the chair from South Africa for the 2026 presidency. Therefore, South Africa should use the Johannesburg Summit to discuss multilateral trade issues without the presence of President Trump, while encouraging other African countries to step up.

G20 members, especially the EU as the most attractive large market, should seize the opportunity to engage in serious trade talks with Africa with a view to deepening existing market access schemes. 

From an African perspective, the new US tariffs are a serious threat, particularly in the short to medium term through lost export market access and potentially slower US growth, combined with longer-term negative systemic impacts. 

However, changing US trade policy may offer chances. African governments and businesses can shift to other markets, on the continent, and elsewhere such as China, BRICS+, the EU and other G20 members. 

It now depends on African countries as well as on G20 members to make the best of the new geo-economic environment.