By: Sangu DELLE (Dr)
On April 5, 2025, a seismic event rocked the global trade system. President Donald Trump imposed a blanket 10% tariff on all imports into the United States, including those from friendly nations like Ghana.
This unprecedented policy not only torpedoes decades of multilateral trade cooperation, but also undermines one of the most successful instruments of U.S.-Africa economic diplomacy: the African Growth and Opportunity Act (AGOA).
For Ghana, this is no mere headline. It’s a body blow to key export sectors (cocoa, textiles, shea butter, cashews, and more) that have benefited from duty-free access to the U.S. market for over two decades.
It is also a clarion call: Ghana must pivot, diversify, and build economic resilience. Because while we may not have chosen this fight, we cannot afford to lose it.
Ghana’s direct exposure: small numbers, big stakes
To be clear, Ghana is not among the most exposed countries when it comes to direct trade with the United States. In 2024, Ghana exported about $1.2 billion worth of goods to the U.S.—roughly 3.5% of its total exports.
But within this modest share lie sectors that are vital to job creation and industrial policy. Cocoa and its derivatives accounted for over $200 million of those exports. Apparel, processed foods, shea butter, and gold jewelry made up significant portions as well.
These are not your average raw commodities. They are the fruits of Ghana’s industrialization efforts, painstakingly nurtured under AGOA’s preferential access.
With the stroke of a pen, Trump’s tariffs erased Ghana’s competitive advantage, slapping a 10% tax on goods that previously entered the U.S. duty-free.
Factories that once thrived on American orders now face cancellations or cost crunches. Cooperatives exporting value-added cocoa face the prospect of pricing themselves out of the market.
Even crude oil, Ghana’s top export to the U.S., though initially exempt from tariffs, is not spared entirely. Oil prices have plummeted on fears of a global recession triggered by the tariffs. Every dollar drop in Brent crude erodes Ghana’s foreign exchange earnings and public revenue.
AGOA: A lifeline cut short
AGOA was meant to help Africa move beyond aid—to build capacity, add value, and compete in the global market. For Ghana, it has done just that.
While only 26% of Ghana’s U.S.-bound exports were AGOA-eligible in 2024, those goods represented high-value, job-intensive industries. Garments, cocoa butter, cashews, yams, and shea — all growth areas that employed thousands and empowered local businesses.
Now, AGOA is a dead letter. Though the law remains on the books, the 10% tariff applies regardless, nullifying its benefits.
And with AGOA set to expire in September 2025, there is real danger that it may not be renewed at all. The message from Washington is clear: free trade is out, protectionism is in.
For Ghana, this is a wake-up call. We can no longer rely on benevolence or preferential access. The future must be built on competitiveness, diversification, and regional integration.
The Indirect Punch: commodity volatility and capital flight
Ghana’s economic model is heavily commodity-dependent. Gold, oil, and cocoa together account for over 80% of export earnings. Any global trade shock that affects prices or demand for these commodities sends tremors through Ghana’s economy.
Already, the tariffs have triggered a flight to safety. Gold has surged above $3,100 an ounce (good news for Ghana in the short term). But oil has fallen below the budgeted US$74.7 per barrel, threatening government revenues. Cocoa prices, meanwhile, remain uncertain.
If American or European consumers tighten their belts, luxury items like chocolate may see reduced demand, pulling prices down and hurting Ghanaian farmers.
Worse still, investor sentiment is souring. Ghana has only just begun to rebuild from a recent debt crisis, with support from the IMF and tighter fiscal policies.
But in a jittery global environment, capital flows may slow, remittances may dip, and borrowing may become costlier. The Ghanaian cedi, already under pressure, could weaken further, fueling inflation and raising debt service costs.
From fragility to fortitude: what Ghana must do
This crisis is painful, but it can also be transformative. Ghana must respond with urgency, clarity, and ambition. Here’s how:
Double Down on AfCFTA and Regional Markets
The African Continental Free Trade Area (AfCFTA) offers Ghana a real alternative. With a potential market of 1.3 billion people, AfCFTA can replace lost demand from the U.S. Ghana must invest in trade infrastructure, harmonize standards, and facilitate cross-border commerce to unlock intra-African trade. Our cocoa, textiles, and processed foods can find buyers in Lagos, Nairobi, and Johannesburg just as easily as in New York, if we do the work.
Accelerate industrialization and value addition
We must stop exporting raw materials and start exporting finished products. Cocoa should leave our ports as chocolate, not beans. Crude oil should be refined locally. Ghana must scale up manufacturing; offer tax incentives for agro-processing; and support exporters to upgrade quality, packaging, and branding. Local industries must be made resilient enough to survive global shocks.
Stabilize the macroeconomy and build buffers
The cedi must be protected. The Bank of Ghana should continue prudent monetary policy, including gold purchases to shore up reserves. Government should prepare contingency plans in case oil and cocoa revenues underperform. Inflation must be tamed and fiscal targets maintained to preserve investor confidence. Ghana’s economic fundamentals are improving; let’s not lose ground now.
Engage Diplomatically and Strategically
Ghana must speak up. The U.S. says countries can negotiate tariff relief; let’s take them up on it. A targeted exemption for cocoa derivatives or garments could save jobs and stabilize industries. Ghana should also rally other African nations to jointly lobby for an AGOA extension or replacement. If AGOA is gone, we must work toward a new bilateral or regional trade framework with the U.S.
At the same time, Ghana should deepen ties with other partners. The EU, UK, China, and India offer trade opportunities that should be pursued with vigor. Ghana’s trade strategy must be multipolar, pragmatic, and proactive.
Protect Workers and Small Businesses
Behind every export statistic are real lives. The women sewing garments in Accra, the farmers processing shea in Tamale, the small business owner exporting cashews in Techiman; these are the Ghanaians most affected. Government must cushion the blow with temporary support: tax relief, export incentives, retraining programs. Let’s ensure this trade shock does not become a social crisis.
The End of Illusions, The Start of Resolve
Trump’s tariffs have shaken Ghana’s trade model to its core. But the real test is not what Washington does; it’s what we do. Ghana cannot afford to wait for mercy or maneuver through uncertainty with complacency. We must confront this challenge with resilience, creativity, and collective resolve.
Let this be the moment Ghana stops depending on trade handouts and starts building a future of strategic independence. Let us turn this moment of economic nationalism abroad into a moment of economic renewal at home.
We didn’t choose this crisis. But we can choose our response. And in doing so, we can reclaim our economic destiny.
So help us, GOD.
