Africa Must Look Inward: A Case for Strengthening the AfCFTA

Africa Must Look Inward: A Case for Strengthening the AfCFTA

• Economy
• April 03, 2025

In a decision that stunned economists and policy leaders across Africa, U.S. President Donald Trump imposed a 50% tariff on all imports from Lesotho. The move has sent ripples across the continent. According to a BBC News article Lesotho is now the second most affected country globally by Trump's tariffs, following only China. This decision is particularly alarming given that Lesotho is a least-developed country (LDC) with longstanding participation in the African Growth and Opportunity Act (AGOA) under which it enjoyed duty-free access to the U.S. market for its apparel exports. AGOA is a unilateral trade preference arrangement. The United States sets the terms without reciprocal obligations from beneficiary countries. While it offers duty-free access, it can be modified, suspended or withdrawn at any time by the U.S. - making it an inherently unpredictable and insecure trade framework for African economies.

As Bloomberg Business further highlights, the newly imposed tariffs form part of a broader "reciprocal tariffs" agenda which applies sweeping rate hikes on dozens of countries including 20 in Africa. Lesotho’s economy, which is heavily reliant on textile exports to the United States, now faces a sharp economic shock that threatens livelihoods. The textile sector is a significant part of Lesotho's economy, employing approximately 40 000 workers and accounting for roughly 90% of manufacturing employment and exports. It is also one of the largest formal employers of women and young people: any resulting job losses from this tariff hike will disproportionately impact these groups, threatening household incomes and worsening youth unemployment.

This development casts a long shadow over AGOA and it raises urgent questions about the reliability of unilateral trade preferences as a foundation for African development. If a least-developed country like Lesotho can be targeted with such punitive measures despite meeting eligibility criteria, what security do other African countries have in their trade arrangements with major economies?

This is not just a Lesotho issue - it is a continental one. The answer lies in accelerating the implementation of the African Continental Free Trade Area (AfCFTA). With 54 signatories, the AfCFTA presents Africans with an unparalleled opportunity to build a resilient internally-driven economic architecture that reduces dependency on volatile external markets. Africa has a combined market of over 1.3 billion people - the AfCFTA offers Africa the chance to scale local industries, retain value chains and shield itself from geopolitical shocks.

Strengthening intra-African trade, investing in regional value chains and speaking with one voice in global trade forums are no longer aspirational goals - they are urgent priorities. The Lesotho tariffs offer a sobering lesson: Africa must look inward for sustainable growth, industrialisation and trade resilience.

The future of African trade must be built on African terms. That future is the AfCFTA.

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*Anele Simon is the Acting Secretary General of the Independent Continental Youth Advisory Council on AfCFTA (ICOYACA), where she champions youth inclusion in Africa’s trade landscape. She holds a Master’s degree in International Trade and Investment law.

**Image Source: Yahoo Finance