US tariff hikes undermine Agoa

The decision by the United States (US) to impose reciprocal tariffs on trading partner countries has been seen as undermining the African Growth and Opportunity Act (Agoa).

This agreement allows sub-Saharan African countries preferential access to the US market with some products allowed to enter duty-free.

Executive director in the Ministry of International Relations and Trade, Penda Naanda, says: “The move by the US administration undermines the commitment under Agoa, a non-reciprocal agreement designed to support developing countries and least developed countries in Africa.”

US president Donald Trump slapped Namibia with a 21% tariff on local products.

Currently, Namibian products including beef, lamb, fish, grapes and blueberries access the American market duty-free.

However, Agoa is scheduled to come to an end in September 2025, with talks of a renewal taking place currently. The new tariffs could decrease the competitiveness of Namibian beef and fish exports due to price increases, according to Naanda.

“Tariffs could disrupt established supply chains and negatively affect Namibia’s export earnings, impacting broader preferential stability for Namibian products under the generalised system of preferences regime,” says Naanda.

He adds that the ministry is working to mitigate the impacts of the tariffs and stakeholder engagements will be held.

“The ministry would explore several strategies to mitigate the impacts of the 21% tariffs imposed by the US which the ministry cannot reveal at this point in time,” the executive director notes.

A lot of criticism has been expressed against the methodology used to calculate the tariff hikes.

The tariff was calculated primarily based on existing trade balances which is contrary to what the US had said it would do.

In a statement published last week, the US said the formula divides a country’s trade surplus with the US by its total exports. That number was then divided by two to give the reciprocal tariff.

Reciprocal tariffs means the US will impose tariffs on other countries that are equivalent to the tariffs those countries impose on US goods. Namibia imposes a 42% tariff on imported US products. According to a statement issued by the White House, these tariffs seek to address the injustices of global trade, reshore manufacturing, and drive economic growth for the American people.

“Reciprocal trade is ‘America first’ trade because it increases our competitive edge, protects our sovereignty, and strengthens our national and economic security,” reads the statement. In 2024, the total goods trade between the US and Namibia reached approximately N$7.8 billion. US exports to Namibia were around N$2.8 billion, showing a decrease of N$289.8 million from the previous year. US imports from Namibia were roughly N$4.9 billion, marking a rise of approximately N$2.565 billion.