While the direct effects of US tariffs on sub-Saharan African trade were limited, the broader economic and political ramifications – through falling commodity prices, fiscal tightening and rising insecurity – were likely to be severe across the region, BMI head of sub-Saharan Africa country risk Jane Morley has said.

Speaking during a webinar hosted by BMI – a Fitch Solutions company – on April 23, she said that, despite back and forth over tariffs, they are likely to remain in place in some form.

This was the result of a structural shift in trade policy under US President Donald Trump, aimed at achieving objectives including increasing tax revenue, improving supply chain resilience, attracting investment and boosting jobs.

Morley stated that BMI believed the US administration was interested in negotiating agreements with other countries to reduce the average tariff rate, which currently stood at about 25%.

BMI also anticipated the introduction of additional Section 232 tariffs on goods such as semiconductors and pharmaceuticals. As these sectors had been slow to see tariff reductions, the administration might attempt to offset their impact by reducing tariffs in other areas through negotiations, though this could prove difficult.

She added that there was also an incentive for Trump to de-escalate trade tensions, despite his rhetoric. Trump had acknowledged that the US economy could experience some discomfort. Should the economy enter a recession, it could result in a growing fiscal deficit, complicating future fiscal consolidation and weakening the labour market. This, in turn, might affect Republican prospects in the 2026 midterm elections.

Morley said that while Trump had signalled that certain economies might be able to negotiate tariff rates below 10%, it remained reasonable to expect average tariff rates to remain elevated at around 20%. She noted that this figure was significantly influenced by the high tariff rate applied to China.

According to BMI, high tariff rates were expected to negatively impact global growth through four main channels: the direct impact on bilateral trade owing to weakened trade flows from increased relative prices; reduced business spending and job growth owing to heightened uncertainty; a negative wealth effect on households stemming from declining equity markets and rising unemployment; and tighter financial conditions constraining lending and investment.

As a result, BMI had revised down many of its economic forecasts, including for major economies such as the US, China, and Germany. Forecasts for sub-Saharan African markets were also downgraded, although the extent varied depending on factors such as effective tariff rates, second-round effects and domestic conditions.

Morley noted that all 49 sub-Saharan African markets were currently subject to a baseline 10% tariff on most exports to the US, with exceptions for critical minerals and oil. Higher tariffs of 25% applied to steel, aluminium and automotive goods. She cautioned that the 10% figure could be misleading, as effective tariff rates varied considerably.

She explained that countries such as Somalia, Mali and Burkina Faso faced high effective tariff rates but were not significantly impacted owing to limited trade volumes with the US.

“Indeed, this is the broad story for sub-Saharan African, since US- sub-Saharan African trade just isn’t that substantial in the first place. The US only accounts for about 4% of the region’s total exports,” Morley said.

However, exceptions existed. Morley cited Lesotho and Madagascar, which relied heavily on the US market for low-margin clothing and apparel exports. These sectors were highly vulnerable to tariff costs, leading to likely increases in consumer prices in the US and reduced demand.

While direct effects were minimal for most of the region, Morley emphasised the importance of second-round impacts, particularly the sharp decline in commodity prices following the tariff announcements. Copper prices, for example, had dropped significantly, affecting markets such as Zambia and the Democratic Republic of the Congo (DRC).

Oil prices were down by over 7% over the past month, prompting BMI’s oil and gas team to revise their Brent crude forecast to an average of $68/bl, down from $75/bl.

Lower oil prices could benefit net importers such as Kenya, Ethiopia and South Africa. However, the impact on oil-exporting countries would be substantial. Congo-Brazzaville and Gabon were identified as highly exposed, with Angola also facing serious challenges owing to the likelihood of exchange rate instability and rising inflation.

Morley warned that tariffs would also worsen fiscal challenges in the region. Eurobond yields for key sub-Saharan African economies had risen sharply since the tariff announcement, with yields in countries such as Nigeria, Kenya and Ghana reaching around 10%, effectively excluding them from international capital markets. Nigeria, for example, had planned to issue a $1.7-billion Eurobond to finance its 2025 budget deficit.

As a result of constrained access to external financing, many governments would likely turn to domestic borrowing, increasing their debt servicing burdens. Morley noted that interest payments already consumed about 25% of government revenue in sub-Saharan Africa, limiting fiscal space for improving public services or investing in development.

She added that these economic pressures were expected to heighten political risks. Many sub-Saharan African countries were already experiencing elevated political risk and the shifting trade environment was likely to exacerbate policy and social challenges.

Morley pointed out that deteriorating economic conditions could result in job losses and growing anti-government sentiment, and could intensify existing armed conflicts – particularly in commodity-dependent States.

In the DRC, she explained, copper exports provided about one-third of government revenue. The recent drop in copper prices would severely restrict the government’s capacity to finance military operations, especially in the eastern provinces where rebel groups had already seized significant territory.

She also highlighted that high gold prices – driven by increased demand for safe-haven assets – could worsen security dynamics. Much of the gold sector in the DRC remained informal and under the control of rebel factions.

“While the DRC does export some gold through official channels, the sector is largely informal, with many gold mines being controlled by rebel groups,” she said.

Higher prices would enable these groups to finance and expand their operations and incentivise them to seize more gold-producing areas. Morley noted a positive correlation between gold prices and security incidents in the DRC’s eastern provinces, indicating that conflict would likely intensify as gold prices remained high.

Morley further warned that the tariff-driven decline in oil prices could increase the risk of conflict in South Sudan. Although the 2018 peace agreement had reduced violence, recent political tensions had risen, exacerbated by the detention of South Sudan VP Riek Machar’s child in March.

Given that oil accounted for the vast majority of South Sudan’s exports and operating revenue, the decline in prices threatened to destabilise political patronage systems and essential government functions.

Mozambique was also identified as being at risk of rising protest activity owing to the broader economic fallout from tariffs. Although its direct exposure to the US was limited, its reliance on coal and liquefied natural gas exports made it vulnerable to slumping global commodity prices.

Combined with fiscal challenges following World Bank support in 2024 and post-election unrest, the weakening Mozambican metical could drive up living costs and revive public dissent.