Ngozi Okonjo-Iweala, the Director-General of the World Trade Organization (WTO) and Nigeria’s former Finance Minister, has called on African countries to focus on enhancing intra-regional commerce and becoming more economically self-sufficient in the wake of new tariffs imposed by the United States.
Speaking at the International Monetary Fund (IMF) and World Bank Spring Meetings in Washington, Okonjo-Iweala highlighted the limited impact of the U.S. tariffs, which affect only 6.5% of Africa’s exports. However, she pointed out that certain African nations—particularly poorer countries—are facing significant repercussions.
Tariff Impacts on Lesotho and Other Countries
On April 2, U.S. President Donald Trump announced tariffs of at least 10% on all imports, with some countries like Lesotho facing 50% reciprocal tariffs. Okonjo-Iweala emphasized the devastating economic effects these tariffs would have on countries like Lesotho, which exports textiles to the U.S. valued at $200 million annually.
“If the tariffs are implemented, Lesotho could lose nearly half a percentage point of its GDP growth, which would be catastrophic for a poor nation,” she explained.
Countries like Ghana (10%) and Cote d’Ivoire (21% on cocoa) are also affected, with cocoa exports to the U.S. potentially facing major losses due to differential tariffs. Okonjo-Iweala suggested that the U.S. could consider waiving tariffs for the least developed countries, which face the greatest challenges.
Africa’s Path to Economic Independence
Okonjo-Iweala stressed the importance of Africa becoming more self-reliant and investing in domestic infrastructure to attract foreign investments. She also underscored the need for intra-Africa trade, which currently accounts for only 16 to 20 percent of the continent’s trade. This is well below the global average and must be expanded, particularly through value-added products.
“We cannot keep exporting raw commodities. We need to process our products, create jobs, and generate value within Africa itself,” she said.
She also cited Lesotho’s textile exports to the U.S. as an example, noting that Africa spends $7 billion annually importing textiles. “Why can’t Lesotho sell its textiles to other African countries?” Okonjo-Iweala asked.
Lesotho’s Economic Situation
In 2023, Lesotho exported a total of $1.14 billion, with diamonds (worth $539 million), non-knit men’s suits, wool, and knit women’s suits making up the largest exports. Despite the limited impact of U.S. tariffs, Lesotho and other African nations need to explore new markets and boost intra-Africa trade to mitigate the consequences of external pressures.
As Africa faces the dual challenges of external tariff pressures and internal economic challenges, Okonjo-Iweala’s message is clear: Africa must act now to build economic resilience, boost internal trade, and reduce dependency on foreign markets.
