Africa and the Trump effect

With the ultimate American big man headed back to the White House, African nations can expect an era of uncertainty and upheaval.

Donald Trump’s approach to trade, foreign aid, climate change, financial markets, and geopolitics will impact on Africa’s strategic relationships with the U.S., creating new pressures on stability and growth. There are opportunities for African countries, such as leverage in a US-China rivalry, and realignment in relations with Russia.

But overall, Trump’s shadow will fall on Africa in five key areas: trade, aid, climate change, financial markets, and geopolitical dynamics. By setting out the best- and worst-case scenarios, this article outlines potential paths that Africa might face in each area. Future articles will explore these channels more closely, delving into the specific ways these policies could shape Africa’s economic, environmental, and political landscape and discussing strategies for navigating these challenges.

There will also be an article analysing the potential impact of Trump's presidency on the progress towards equality for women, people with disabilities and marginalised groups on the Continent.

1. Trade

Best-case scenario: Strategic partnerships

Tariffs are a Trumpian obsession. In a best-case scenario, Trump’s trade policies would balance a regime of tariffs to protect US manufacturing with selective support for African trade partnerships. A U.S. baseline tariff of 10% on all imports, as proposed, could be selectively applied, potentially leaving room for African countries to secure favourable trade deals. This could open opportunities for African exporters in sectors like agriculture and textiles, helping to sustain jobs and economic growth.

Worst-case scenario: Reduced market access

More likely is a worst-case scenario that would see aggressive tariff policies disrupting US/African  trade relations. For instance, Nigeria’s weighted mean applied tariff of 12.4% and Ghana’s of 10.5% might increase in retaliation if U.S. tariffs are broadly applied, hurting African exports and pressuring local industries. Restricted access to the US market would strain export-dependent economies and reduce the foreign exchange flows essential for national development. 

2. Overseas Aid

Worst-case scenario: Critical aid programmes slashed

Trump’s track record on aid makes a worst-case scenario the most likely. His previous administration proposed cuts of 22-32% to foreign assistance, with substantial reductions in healthcare and social support programmes. Such cuts would have drastic effects on essential services, such as HIV/AIDS treatments through PEPFAR, which have reached millions across Africa. Lower aid would impact food security, access to education, and poverty alleviation, increasing pressure on African governments already facing budget constraints.

Best-case scenario: Focus on health

The US currently provides about $8 billion annually in aid to Sub-Saharan Africa, with 70%  directed to health programmes, including PEPFAR (President’s Emergency Plan for AIDS Relief), which has been instrumental in combating HIV/AIDS. A reformed, less combative Trump administration could see this aid sustained, benefiting the millions reliant on US-supported healthcare services. Sustaining aid in health, economic growth, and infrastructure could ensure continued support for existing development initiatives across Africa.

3. Climate change and environmental policies

Best-case scenario: Targeted US support for African renewable energy and climate resilience

If Trump’s administration supports climate adaptation selectively, US funding could continue aiding Africa’s resilience to climate-related risks. Africa, highly vulnerable to climate change effects like droughts, rising temperatures, and extreme weather, relies on global support to build climate-resilient infrastructure. A continued focus on renewable energy would benefit countries with rich solar and wind potential, helping them transition to clean energy sources that foster economic growth and reduce reliance on fossil fuels.

Worst-case scenario: US acceleration of Africa’s climate emergency

In a worst-case scenario, Trump’s policies could lead to the US scaling back its efforts to mitigate climate change, whilst also accelerating the process by greenhouse gas emissions through relaxed regulation. Africa would experience intensified climate impacts, with more severe droughts, flooding, and coastal erosion. This vulnerability, coupled with reduced US support for renewable energy and adaptation programs, would set back Africa’s climate progress, exacerbating resource scarcity and potentially increasing displacement and conflict in affected regions.

4. Financial markets and currency fluctuations

Best-case scenario: Stable markets with low borrowing costs for African nations

In a best-case outcome, Trump’s policies would encourage stability in US financial markets, minimising global volatility. This stability could reduce capital flight from African economies, preserving investment flows and reducing pressure on local currencies. If the Federal Reserve maintains steady interest rates, African nations with dollar-denominated loans would face lower borrowing costs, facilitating growth-oriented public spending.

Worst-case scenario: High volatility, capital flight, and rising costs

Alternatively, aggressive protectionist policies could heighten market volatility, prompting foreign investors to withdraw from emerging markets and flock to safer US assets. This capital flight would depreciate African currencies, increase import costs, and drive inflation, impacting essential goods like fuel and food. Higher US interest rates would also raise borrowing costs for African governments, straining debt servicing budgets and reducing available funds for infrastructure and social programs.

5. Geopolitical dynamics and security

Best-case scenario: Strategic US-Africa security partnerships and balanced diplomacy

Trump’s geopolitical priorities are to end the wars in Europe and the Middle East. Africa’s wars aren’t on his radar. However, Trump is also outspoken in his opposition to terrorism, so increased US funding for African militaries and counter-terrorism in strategic regions like the Sahel and East Africa could provide resources to stabilise regions under threat from extremist groups. African countries might leverage this competition to foster partnerships that align with their unique development needs.

In an age of migration, Trump’s policy of deporting millions of illegal immigrants from the US will be felt in the first instance by his country’s southern neighbours, but the impact of his rhetoric will stretch further afield.

Worst-case scenario: Divisive alignments between the world’s superpowers

In a worst-case scenario, intensified US-China rivalry could create divisions between African nations. US encouragement to limit Chinese influence may lead to selective security support, side-lining nations more aligned with China and creating security disparities. African countries could face increased pressure to support US stances in international organisations, complicating diplomatic relations and reducing flexibility in multilateral platforms. Europe’s influence may also be further reduced if the US prioritises security over development aid, skewing the approach of western allies across Africa.  

Conclusion

Africa is most likely to experience the worst-case scenarios set out above. The combination of strained trade relations, severe cuts to essential aid, reduced support for climate adaptation, financial market instability, and the forced realignments in a US-China rivalry could set back African economies emerging from Covid-related recessions and impacted by conflict and climate change. The cumulative impact on Africa could be catastrophic, and Trump, notoriously quixotic and inconsistent, focussed on Europe and the Middle East, and determined to please his base, is unlikely to care.

African leaders and stakeholders have a small window of opportunity to press for the best-case outcomes. Maintaining resilience, strengthening regional cooperation, and strategically engaging with global powers can still mitigate some of the impending challenges. While the path forward may be fraught with difficulties, the drive must be to secure a stable and prosperous future for Africa continues.