Southern Africas Economic Outlook Clouded By US Tariff Uncertainty Photo By Canvas
Southern Africa’s Economic Outlook Clouded by US Tariff Uncertainty
Nairobi, Kenya – Southern African nations are facing increasing economic uncertainty as the specter of higher U.S. tariffs looms, a move that could disproportionately impact the region’s most vulnerable economies. This development, particularly concerning countries like Lesotho, comes as a direct consequence of shifting U.S. trade policies under the current administration.
Lesotho, a nation heavily reliant on its textile industry, has already declared a national state of disaster, citing high youth unemployment and job losses exacerbated by the tariff uncertainty. According to a report by allAfrica.com on July 10, 2025, Lesotho was initially hit with a 50% tariff increase in April, though these have since been paused.
Deputy Prime Minister Nthomeng Majara stated that this state of disaster would remain in force until June 30, 2027, enabling swift funding for job-creation and recovery programs. The country’s official figures show unemployment at 30%, with nearly 50% for young people. Concerns are also mounting that up to 40,000 jobs could be lost if the African Growth and Opportunity Act (AGOA), which grants African nations duty-free access to the U.S. market, is not renewed in a favorable form.
Adding to the complexity, recent reports from Polity.org on July 10, 2025, indicate that the U.S. administration’s proposed 30% tariff on South African exports is set to economically impact a community that the U.S. President has controversially championed: white farmers. This highlights a potential disconnect between rhetoric and the practical economic consequences of such policies.
While the African Development Bank Group’s 2025 African Economic Outlook, as cited by DevelopmentAid on May 28, 2025, projects an overall economic growth acceleration for Africa from 3.3% in 2024 to 3.9% in 2025, Southern Africa is forecast to lag behind. The region is projected to grow at only 2.2%, with its largest economy, South Africa, expected to achieve a mere 0.8% growth.
This contrasts sharply with East Africa’s projected 5.9% growth, underscoring the regional disparities in economic resilience.The broader implications of these tariff threats extend beyond immediate job losses and economic slowdowns. They signal a more transactional approach to U.S.-Africa trade relations, potentially aligning tariff-free access more sharply with U.S. geopolitical interests, particularly in countering China’s growing influence on the continent, as noted by Chatham House in January 2025. This could force African nations to re-evaluate their economic partnerships and strategies in an increasingly complex global trade landscape.
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