Trump tariffs speed up diversification

A return of Agoa access to the United States will give East African exporters more time to continue their drive to diversify their markets. Trump’s “Liberation Day” tariffs hit East African exporters with an average 10% tariff, which gave them a temporary advantage over competitors in the Far East who were hit with an average tariff of 26.4% for apparel and textile exports. In the ever-changing Trump tariff regime, the Supreme Court has blocked these earlier tariffs, with Trump retaliating with a global 10% import tariff using different legislation. While it will reduce tariffs for Far East exports to the US, East African countries have the advantage of Agoa tariff- free access, which has been extended for a year. The region has been diversifying for some time, and is less reliant on US business. As Andrew Mold, director, Sub-Regional Office for Eastern Africa – United Nations Economic Commission for Africa at the Brookings Institution, says, “paradoxically, in a situation where the world’s largest importer has applied tariffs indiscriminately on its trading partners, some African sectors might end up benefiting from increased orders, as US firms look for alternative sources of supply”. He says concerns over the impact of the tariffs were “compounded by the widespread perception that the United States remains one of Africa’s main export markets”. He points out that 2025 exports from East Africa to the US were up to where they were in 2024. In the case of Kenya – a major clothing exporter in the region – its exports to the US increased 22% between April and July 2025, compared with the same period the previous year, reaching a three-year high. “Despite having been suspended from the African Growth and Opportunity Act (Agoa) in 2022, neighbouring Ethiopia experienced an even greater jump in its exports, with a 95% increase.” His view is strengthened by figures released by the East African Community (EAC), which show that total trade in the third quarter of 2025 rose by 21.9% to $40.3 billion. The growth was made up of a 32.3% increase in exports to $19.6bn, while imports grew by 13.3% to $20.6bn. This narrowed the region’s deficit to $1bn, down from $3.4bn in Q3 2024. Trade within Africa remained significant, accounting for 32.2% of total trade at $10.1bn, while intra-EAC trade expanded by 15% to $4.8bn. The quarterly EAC Statistics Bulletin lists the region’s most traded exports as base metals, precious stones and metals, mineral fuels and key agricultural products. China, the UAE, South Africa, Hong Kong and Singapore collectively absorbed 58% of total exports. On the import side, critical categories such as petroleum products, machinery, vehicles and cereals continued to support the region’s infrastructure development, industrial activity and food supply, according to the bulletin. ER