Accra – The GITFiC, a quasi-public institution dedicated to fostering trade, economic growth, and financial stability based in Accra, has expressed concern regarding the recent decision by the United States to impose tariffs on 60 countries. In its official statement released and signed by Chief Executive Officer, Mr. Selasi Koffi Ackom on Friday, April 5, 2025, GITFiC highlighted the potential implications of such measures and offered three constructive recommendations for the nations affected by these tariffs. Below are the comprehensive details of the statement:
Tariff Tsunami: Global Wave Shakes Nations from Lesotho to the UK – A GITFiC Analysis
- On April 2, 2025, President Donald Trump marked “Liberation Day” from the White House Rose Garden, introducing an ambitious plan for global reciprocal tariffs aimed at creating fairer trade practices. This policy establishes a baseline 10% tariff on nearly all imports, with additional rates for approximately 60 countries, aiming to rebalance trade relationships and promote equitable trade practices. The implementation of these tariffs, set to begin in phases on April 5 and April 9, signals a transformative approach in U.S. trade policy.
- Countries such as Lesotho, Cambodia, Laos, and Madagascar are now facing substantial tariffs, with Lesotho hit the hardest at 50%. These tariffs are intended to encourage nations to reevaluate their trade practices and foster economic growth. For example, Cambodia and Laos are subject to tariffs of 49% and 48%, respectively, while Madagascar faces a 47% tariff. While these changes may pose challenges, they also present an opportunity for these countries to enhance their economic strategies and competitiveness in the global market.
- Conversely, larger economies have been largely spared from drastic impacts. The United Kingdom, despite its significant global presence, will see only a modest 10% tariff. This relatively small rate signals an intention to maintain strong trading relationships and stability within the global market. Similarly, Brazil, Singapore, and Chile face just a 10% tariff, which allows their robust agricultural, industrial, and technological sectors to continue thriving.
- The differing tariff rates reflect a strategic approach. For smaller nations, the higher tariffs aim to facilitate meaningful economic adjustments and encourage trade reforms. In contrast, for established economies like the UK, Brazil, Singapore, and Chile, the minimal tariffs are designed to sustain trade flows and prevent retaliatory actions that could lead to broader trade tensions. Ghana, Togo, the Kingdom of Morocco et al., are on the baseline of 10%.
- This shifting landscape has also prompted responses from other nations. For instance, China has announced a 34% reciprocal tariff on U.S. imports, emphasizing the need for compliance with international trade standards and advocating for equitable practices.
- Canada has also taken steps to recalibrate its trade relationship with the U.S., implementing a 25% tariff on certain U.S. auto imports. Canadian Prime Minister Mark Carney remarked that the traditional framework of global trade anchored in the United States has fundamentally changed, signaling an opportunity for Canada to reimagine its trade strategies moving forward.
- That GITFiC is of the view that, as the global trade environment evolves, this moment presents both challenges and opportunities for countries to adapt, innovate, and strengthen their economic futures.
- The European Union is taking proactive steps in response to the reciprocal tariffs imposed by the U.S. It is finalizing its first package of countermeasures against steel tariffs and is preparing additional measures to safeguard its interests should negotiations not yield favorable outcomes.
- As nations worldwide adapt their strategies under this evolving tariff landscape, The GITFiC poses an important question, thus: Should Africa respond collectively as a union or through individual member states? Considering the continent’s diverse economies and the potential for coordinated action via organizations like the African Union, we believe this decision could greatly enhance Africa’s role in global trade.
- In light of increasing protectionism and a shifting geopolitical climate, the rise in tariffs is reshaping international economic relationships. This moment presents an opportunity for nations to address their economic vulnerabilities and contribute positively to global trade governance. The effectiveness of these measures in balancing trade deficits or triggering further responses remains to be seen, but their influence on the global economic landscape is already significant. Tariffs are primarily sales taxes, mainly beneficial to the targeted country rather than the imposing country.
RECOMMENDATIONS BY THE GITFiC
The GITFiC recognizes that the unilateral stance adopted by the Trump administration presents both challenges and opportunities for global trade. To navigate this landscape effectively, The GITFiC recommends the following actions:
- Given that over 80% of countries in Africa may lack the capacity for effective individual retaliation, a united response is recommended to maximize impact. Same for others.
- It is crucial for both highly affected and less affected countries to promptly engage with the World Trade Organization (WTO) and invoke WTO Article XXIII, which addresses dispute resolution and consultation, thereby facilitating constructive dialogue and urgent redress.
- All affected state parties retain the right to seek legal recourse against the United States for reversal, economic damages, and compensation, emphasizing the importance of fairness in international trade. The WTO is a master of its rules and has established world-class adjudication procedures and processes in place. Fair Trade is the order of the day.
It is essential for the United States to understand the interconnected nature of global trade and its impact on economic stability and transformation. By recognizing the collaborative efforts required in addressing these issues, The GITFiC can collaborate with all affected state parties to work toward maintaining the momentum of economic progress and stability through our Global Debt Initiative, thereby avoiding setbacks reminiscent of the challenges faced during the COVID-19 pandemic. End
—- Signed —-
Selasi Koffi Ackom
Chief Executive – The GITFiC