President of the African Development Bank Group, Dr. Akinwumi Adesina, says the high reciprocal tariffs imposed on African countries by the Trump administration is a devastating to blow to the debt servicing obligations on the continent.
Dr. Adesina reveals that the tariffs will not only increase the cost of African products in the US but will also significantly increase the cost of debt servicing and worsen fiscal pressures in the affected economies.
The President of AfDB made this revelation when he delivered a lecture at the 14th Convocation Ceremony of the National Open University of Nigeria (NOUN) in Abuja last week on the topic “Advancing Africa’s Positioning within Global Development and Geopolitical Dynamics.”
47 out of 54 African nations have now been placed under higher tariffs by the United States. This move has been described as a serious threat to the continent’s export revenues and foreign exchange reserves.
This development, he says, will result in a sharp decline in exports to the U.S., which will trigger a ripple effect of economic disruptions across the region.
“The immediate direct effects of the tariffs on African countries will be a significant reduction in exports and foreign exchange availability. This will send other shock waves through African economies,” he indicated.
Very worrying is the impact of the development on Africa’s debt burden which Dr. Adesina believes is most crippling.
He explains that as the tariffs result in governments earning less from trade and their currencies lose value, the cost of repaying external debts, much of which is denominated in dollars, will soar.
This, he says, will lead to a dangerous rise in the share of government revenue allocated to servicing debt, leaving less room for essential investments in education, health, infrastructure, and job creation.
He revealed that, “Local currencies will weaken on the back of reduced foreign exchange earnings. Inflation will increase as the costs of imported goods rise and currencies devalue against the US dollar. The cost of servicing debt as a share of government revenue will rise as expected revenues decline.”
The AfDB boss is, therefore, calling on African nations to chart a new course, one anchored not in external dependency but in self-reliance, strategic alliances, and a reimagined vision of African prosperity.
“Africa must chart its future, relying not on the benevolence of others but on its own determination for self-reliance, building reliable alliances, leveraging opportunities in the global dynamics, while putting Africa first. Only then will Africa be great again,” he insisted.
As trade dynamics shift and economic nationalism rises globally, Adesina’s call is for is for African leaders to engage in decisive reform, investment in productivity, and a renewed commitment to building a resilient, self-sufficient continent.
