Trump tariffs prompt Southern Africa to boost regional cooperation

15.06.2025

Global trade relations have recently shifted, as protectionism threatens to dominate an increasingly interconnected world. United States President Donald Trump’s April announcement of import trade tariffs has rattled economies worldwide, casting a long shadow over trade and raising concerns about the future of cooperation. Regional trade blocs are adjusting their strategies amid this shifting global order and looking to strengthen intraregional ties.

It is not clear to what extent the U.S. administration will follow through on the initial and aggressive tariffs announced in February and April. However, this situation has highlighted a crucial reality: Regions like Africa are particularly vulnerable. Their economies continue to depend heavily on access to American and other markets.

The Southern African Development Community (SADC), a regional economic community of 16 member states, initially responded with shock to the White House’s far-reaching tariffs. This quickly transitioned into assessing the long-term consequences for trade and the region’s economies. In the months leading up to President Trump’s inauguration in January, many countries within the SADC and across Africa were already voicing concerns about the future of the U.S.-initiated Africa Growth and Opportunity Act (AGOA).

Since its promulgation by the U.S. in 2000, AGOA has provided African countries with duty-free access to U.S. markets as part of the American initiative to foster trade and growth for eligible sub-Saharan African nations. Through AGOA’s tariff exemptions, the U.S. has provided essential trade concessions for regional producers, with the potential to encourage investment, integration and competitiveness.

The new tariffs effectively nullify the African trade agreement just months before its September expiration. Washington’s pronouncement on tariffs not only jeopardizes AGOA’s cooperative spirit but also necessitates a strategic realignment of African trade priorities in a rapidly changing global environment.

SADC trade dynamics

The SADC has worked diligently to promote regional trade cooperation among its member states. It now faces the major task of addressing the trade turbulence triggered by the U.S. If these changes were to take effect – pending the outcome of the 90-day tariff suspension ending July 9 – the new tariff hikes would have varying effects on different countries of the SADC. This disparity stems from their economies’ differing sizes and strengths, which determine their resilience to rapid shifts in the global trade environment.

The tariffs include a baseline universal 10 percent duty on all U.S. imports and additional tariffs on “worst offender” countries like South Africa. The proposed reciprocal tariffs range between 10 and 50 percent. Notably, Seychelles is the only SADC country exempted from this levy.

Countries like Lesotho, facing a 50 percent tariff rate, and Madagascar, with a 47 percent import tax, will be severely affected, particularly in textiles, mineral extraction and agriculture. Zimbabwe, facing an 18 percent tariff, will also be affected, having already experienced a sharp economic decline due to human rights sanctions imposed by the United Kingdom. These sanctions have worsened the already prevalent issues of resource mismanagement within the country.

Facts & figures: U.S. reciprocal tariff rates

In response to the U.S. decision to increase tariffs, Harare has opted to reduce the import tax on American goods to zero. However, this unilateral action is unlikely to enhance trade between the two countries, especially considering their already strained relations due to Zimbabwe’s poor human rights record.

Zimbabwe’s inadequate infrastructure makes zero tariffs with the U.S. impractical, as the country mainly conducts trade through the SADC region, primarily through South Africa’s ports. Zimbabwe’s former Finance Minister Tendai Biti has criticized President Emmerson Mnangagwa’s decision to eliminate tariffs on U.S. imports, describing the move as selfish, suicidal and a betrayal of regional solidarity. Outside of the African bloc, Zimbabwe’s trade negotiations lack traction for both practical and political reasons.

Strengthening regional unity for resilient trade

The U.S. tariffs highlight the challenges small, poorer nations such as Lesotho face in bilateral trade negotiations with global powers like the U.S. Engaging through multilateral platforms like the SADC is critical for these countries to secure favorable trade outcomes.

The SADC must adopt a regional approach to the evolving trade regime rather than relying on individual bilateral strategies. As is the case with Lesotho and Zimbabwe, building solidarity through regional instruments will greatly benefit these jurisdictions by ensuring the long-term collective advantage of the SADC in realigning its members toward trade stability.

The U.S. tariffs highlight the challenges small, poorer nations such as Lesotho face in bilateral trade negotiations with global powers like the U.S.

However, balancing a bilateral approach with a regional agenda presents challenges for the SADC bloc, particularly in readjusting trade relations among its member states. The different responses of individual SADC countries to their specific issues complicate the region’s unified stance against a rapidly shifting trade backdrop marked by geopolitical influences.

Nevertheless, progress has been made among SADC nations toward achieving intra-state economic solidarity, with a shared understanding developing around the need to streamline trade relations. The SADC Trade Protocol, introduced in 2000 to phase out tariffs and eliminate trade barriers, has gained considerable traction in the region. This initiative is credited with doubling trade among member states since its rollout.

Angola is set to join the SADC Free Trade Area in June, making it the 14th member state in the Southern African free trade zone. This expansion leaves only the Democratic Republic of the Congo and Comoros outside the free trade bloc.

Beyond the SADC, all 55 members of the African Union have signed the African Continental Free Trade Area (AfCFTA) agreement. However, substantial work remains to ensure the AfCFTA is successfully implemented, including effective institutionalization of the instrument across the region. Accelerating the implementation of such regional trade agreements is crucial.

Bilateralism between SADC member states and external or global players can undermine the regional agenda as nations scramble to address their trade issues. In times of uncertainty, national interests often take precedence over regional goals, to the detriment of regional cooperation. While the trade environment may encourage countries to strengthen their regional connections, resulting panic can lead to unilateral actions that threaten the collective efforts needed to navigate the current trade quagmire.

The SADC need not pursue isolationism, nor should member states abandon individual engagements with other players like China, India and Europe. In fact, the U.S. has fallen to third place among Africa’s top trading partners, trailing China and India. Striking a balance between a regional focus and the pursuit of global integration is essential.

Scenarios

Likely: Achieving regional solidarity will be a challenge

Africa is home to some of the largest trade blocs in the world. With the international trade landscape constantly evolving, African nations are turning to each other to boost cooperation in intra-regional trade. There are vast opportunities for the region to boost cooperation and engage effectively at a global level. This will be a daunting task for Africa and its subregions.

However, the key challenge lies in effectively implementing the various trade instruments and ensuring their harmonization across the continent and its subregions.

Moreover, given the region’s diverse levels of development, industrialization and economic sizes, achieving regional solidarity amid competing national interests is difficult. Balancing regional and national priorities is particularly challenging when these interests vary across jurisdictions with differing levels of democratization. Some subregions, such as the SADC and the East African community, may emerge stronger and present a better picture than others or even the continent as a whole.

Unlikely: African countries respond to tariffs in equal measure

In an unlikely scenario, considering their vast mineral resources, African countries might respond to Trump’s tariffs with reciprocal measures, similar to what China did. This could prompt the White House to engage in negotiations with African nations with the aim of accessing these mineral resources and strengthening security cooperation. Such developments would force the U.S. government to reevaluate the broader impact of the tariffs it has imposed, especially the concern that Africa might shift its focus toward alternative trade and security partnerships with China – a situation the Trump administration is likely unprepared to handle.

However, retaliation is unlikely due to the power imbalance and limited leverage of African countries relative to the U.S. For instance, South Africa has indicated that it currently has no plans to counter the tariffs and instead aims to negotiate exemptions.

This reports was originally published here: https://www.gisreportsonline.com/r/sadc-trade-tariffs/