Upcoming Events

Kenya and Uganda Deepen Trade Ties as U.S. Tariffs Reshape Africa’s Global Position

  • 0

In July 2025, Donald Trump’s administration imposed sweeping tariffs on African exports, raising taxes by 10% across the board and up to 50% for selected nations. While South Africa, Nigeria, and Lesotho bore the brunt of these duties, even countries with fewer penalties—such as Kenya and Uganda—were not spared. Their exports, ranging from Kenyan tea and flowers to Ugandan coffee, suddenly faced new costs under the 10% baseline tariff. But rather than retaliate through counter-tariffs or wait for external relief, the two East African neighbours chose a different path: turning inward to dismantle trade barriers between themselves and strengthen regional economic resilience.

 

This move signals a deeper truth about Africa’s future in global trade. The continent’s ability to thrive will not rest solely on preferential access to distant markets like the U.S. or Europe, but on how effectively African nations integrate with one another. By reducing friction at border points, removing non-tariff barriers (NTBs), and reclassifying goods as “transfers” rather than “imports,” Kenya and Uganda have taken concrete steps to slash costs for businesses, unclog transit routes, and build a more seamless regional value chain. Measures such as eliminating discriminatory levies, ensuring 24/7 border operations, and reducing truck queues at Malaba and Busia are not symbolic gestures—they are pragmatic, growth-driven reforms that strengthen Africa’s trade from the inside out.

 

A Blueprint for Continental Integration

The Kenya–Uganda framework directly echoes the ambitions of the African Continental Free Trade Area (AfCFTA), which aims to unify a market of 1.4 billion people under a single trading bloc. By agreeing to treat cross-border trade as transfers, these two nations are piloting one of AfCFTA’s core promises: tariff-free intra-African commerce. Their reforms showcase how political will at the bilateral level can advance regional goals more quickly than waiting for continent-wide consensus.

 

Other blocs could draw lessons here. In West Africa, ECOWAS continues to wrestle with fragmented customs rules that raise transaction costs for traders moving goods from Nigeria to Ghana or Côte d’Ivoire. Southern Africa’s SADC region, despite hosting Africa’s most advanced economy in South Africa, is still weighed down by inefficient port logistics and border bottlenecks. By contrast, the Kenya–Uganda example demonstrates that even modest, targeted reforms—like eliminating duplicate border checks or harmonising excise duties—can deliver tangible benefits for traders, farmers, and manufacturers. If replicated across these blocs, the effect could be transformative: a truly continental trading system resilient to external shocks.

 

Why This Matters for Africa’s Global Standing

The U.S. tariffs have inadvertently forced Africa to confront its over-reliance on distant markets. For decades, African economies structured their trade around preferential agreements such as the African Growth and Opportunity Act (AGOA) in the U.S. or Economic Partnership Agreements with the EU. These frameworks, while beneficial, left Africa vulnerable to sudden policy shifts abroad. Trump’s tariff regime is a reminder that such privileges can be withdrawn at any time.

 

By turning inward, Kenya and Uganda are redefining Africa’s trade priorities. Stronger intra-African trade cushions the continent against global trade wars and provides a more stable platform for industrialisation. A well-integrated Africa also enhances its bargaining power on the global stage: a united market of over a billion consumers cannot be ignored, whether in negotiations with Washington, Brussels, or Beijing. Instead of being reactive to external tariffs, Africa can set its own terms, dictating the flows of goods, capital, and investment.

 

Toward a More Resilient African Trade Order

The long-term significance of Kenya and Uganda’s decision lies in its symbolic and practical value. Symbolically, it proves that Africa can act proactively, using adversity as a springboard for greater integration. Practically, it reduces the costs of doing business for thousands of traders while unlocking efficiencies at critical choke points like Malaba and Busia. These gains, though modest in scale today, set the stage for deeper regional industrialisation—where Kenyan manufacturers can source Ugandan inputs seamlessly, and Ugandan exporters can use Mombasa Port without prohibitive delays.

 

If scaled continent-wide, this model could accelerate Africa’s emergence as a global economic power. Instead of being perpetually shaped by external tariff regimes, Africa would define its future through AfCFTA-driven integration. The Kenya–Uganda partnership, born out of pressure from U.S. tariffs, could thus be remembered as one of the early sparks that pushed Africa toward a more resilient, united, and globally prominent trade order.

Why Currency Strength Matters for Africa’s Economic Future
Prev Post Why Currency Strength Matters for Africa’s Economic Future
The Disability Economy: Tapping the Potential of Africa’s Overlooked Workforce
Next Post The Disability Economy: Tapping the Potential of Africa’s Overlooked Workforce
Related Posts