Years of Western sanctions have weakened the Iranian economy, causing high inflation, unemployment, and the collapse of its currency, the rial. Now, US President Donald Trump is escalating pressure on the OPEC member nation, threatening a 25% tariff on countries that do business with Tehran.

The threat is sending shockwaves across African capitals due to its perceived negative economic consequences. Meanwhile, Iran is facing its largest protests in decades. These protests have largely been triggered by the destabilizing economic woes resulting from Tehran’s isolation.

Over the years, Iran’s main sources of revenue have been Turkiye, the United Arab Emirates, Iraq, China, and India. The country is now gaining new trade partners from Africa, who are contributing to its economy through growing trade relations.

The New Tariff – A Formal Policy or A Pressure Tactic?

On January 12, 2026, US President Donald Trump stated on his Truth Social platform: “Effective immediately, any country doing business with the Islamic Republic of Iran will pay a tariff of 25% on any or all businesses being done with the USA. This Order is final and conclusive.”

The statement provided no further details, no official White House documentation, and no information on the legal authority the president would use to impose the tariff.

Some political commentators see this as a response to the fallout from the 2025 G20 Summit in South Africa, which Trump declined to attend, citing what he termed “white genocide” being perpetrated by the Pretoria regime. Others argue it is a pressure tactic aimed at making Iran stop developing its nuclear plant, which Iran claims is for domestic purposes, but the US believes otherwise.

In response, Iranian Foreign Minister Abbas Araghchi told Al Jazeera Arabic: “If Washington wants to test the military option it has tried before, we are ready for it,” adding that he hoped the US would choose “the wise option of dialogue.”

How Nations are Navigating the Tariffs Waves

 How will Trump’s threat affect Iran’s international trade? If implemented, will the tariff compound already existing US trade measures? What will be the response of countries like China, which buys over 80% of Iran’s oil, and other nations trading with Tehran? These are pressing questions for global political and economic stakeholders.

According to United Nations Comtrade, a global database of official international trade statistics, China is Iran’s largest trading partner, with bilateral trade exceeding $13 billion in 2024. Due to US sanctions, most of this trade is conducted through a shadow fleet and is not officially documented. World Bank data from 2022 indicated that the overall trade volume between the two nations was $37 billion.

Other major oil buyers, such as India, drastically reduced imports after US sanctions were imposed during Trump’s first term, to maintain access to American economic and financial support.

Al Jazeera reporter Katrina Yu, reporting from Beijing, noted: “China does not just buy oil. It also purchases other things… the new tariff is really going to hurt Chinese manufacturing because it will apply on top of the 35% tariff that Chinese goods already face in the US.”

The Chinese embassy in Washington condemned Trump’s tariff policy, stating that Beijing would take all necessary measures to defend its interests and rejecting “illicit unilateral sanctions and long-arm jurisdiction.” The statement emphasized: “China’s stance against the arbitrary use of tariffs has been consistent and clear. No one wins in tariff or trade wars, and coercion and pressure are not a solution.”

Tariffs – Gains and Losses

The announcement of the new US tariffs immediately sent shockwaves through African economies, which rely heavily on the American market as an export destination.

Africa’s trade surplus is at risk, as the US tariff undermines past gains and highlights the urgent need for market diversification strategies to cushion the impact. The US, with the world’s largest economy, nearing $30 trillion, represents a critical export market for competitive African exporters seeking fertile trading ground.

Higher tariffs will have adverse effects on low-income economies like Lesotho and Madagascar, which benefit significantly from the African Growth and Opportunity Act (AGOA). AGOA allows eligible African goods tariff-free access to the US market, but the new 25% tariff threatens this advantage.

African economies already face elevated US import duties due to Trump’s “reciprocal tariff” policy of August 2025. South Africa pays up to 30% on selected goods, Nigeria around 14–15%, Ghana 10–15%, and Kenya and Tanzania approximately 10%. Adding the new 25% tariff on US-bound exports would make these products largely uncompetitive, weakening African export competitiveness, reducing foreign exchange earnings, and putting pressure on local currencies. This is why African nations are actively pursuing market diversification strategies.

How Nations are Responding

Recent BRICS naval maneuvers involving China, Iran, and Russia have heightened concerns among South African authorities and the business community, highlighting how geopolitical conflicts affect trade and economic stability.

The South African Department of Trade and Industry expressed concern over the perceived impact of US sanctions, stating: “We are actively engaging with US officials to seek clarification and explore options that protect South Africa’s legitimate trade interests.”

The sanctions threaten South Africa’s automotive exports, a major economic sector. Companies like Volkswagen, Toyota, and BMW exporting to the US will face higher tariffs. The Johannesburg Stock Exchange has already seen increased volatility, as export-dependent companies experience declining stock prices, affecting foreign exchange earnings.

Many South African exporters are exploring alternative markets in Europe, Asia, and the Middle East to mitigate the tariff’s impact. Analysts note that trade policies are increasingly being weaponized for geopolitical purposes. While large corporations implement contingency plans, smaller businesses may struggle due to limited resources and networks.

Kenya faces a similar dilemma. As a major apparel exporter to the US and a participant in Iran’s African trade network, Kenya is vulnerable to competing pressures. The government has renewed its focus on strengthening US trade ties while briefly pausing major trade negotiations with China, sending a delegation to Washington to appeal the tariff.

Nigeria stands to lose an estimated N1 trillion due to Trump’s tariff. However, Foreign Minister Yusuf Tuggar expressed confidence that the country’s large internal market and diverse trade partners in South America and Asia would buffer the impact. In December 2025, Nigeria held talks with Iran’s new ambassador, focusing on energy cooperation and expanded trade in mining and downstream industries.

Iran-Africa trade, though modest, is expanding rapidly. Mohammadraza Safari, director-general of Iran’s Africa Trade Promotion Organization, predicts Iranian exports to Africa will reach $1 billion by the end of the fiscal year.

The African Union and its Efforts

Trump has used American economic leverage to isolate Tehran. The new trade barriers come at a critical time as Africa seeks to boost intra-regional commerce through the African Continental Free Trade Area (AfCFTA), launched in January 2021.

AfCFTA, the world’s largest free trade area by number of member states, covers 1.3 billion people and aims to increase intra-African trade by eliminating tariffs and reducing non-tariff barriers. It has recorded successes in developing integrated regional supply chains, but infrastructure gaps and regulatory challenges limit its potential to offset lost access to US markets.

Obiora Madu, Director-General of the African Center for Supply Chain, warns: “It is a lesson that AfCFTA must work. If it doesn’t, we are in trouble as far as trade is concerned… Being the single biggest market in the world means we can change things.”

The African Union is pursuing a collective response to unilateral trade actions to promote economic stability. On January 12, 2026, AU Chairperson Mahmoud Ali Youssouf welcomed the three-year extension of AGOA, highlighting the US commitment to strengthening trade, investment, and shared prosperity in Africa. AGOA guarantees duty-free access to over 1,800 products.

US Trade Representative data show that AGOA has boosted African exports by 150% since its inception, supporting over 100,000 jobs in sectors like apparel and agriculture. Country eligibility is reviewed annually by the White House and Senate, exposing trade-dependent economies to policy shifts based on rule of law and human rights compliance.

Conclusion

Can African trade diversification reduce dependence on the US market? Can the continent achieve trade sovereignty despite US pressure on Iran and other global trading partners?

China-Africa trade reached $245 billion in 2024, compared with $8 billion in AGOA-linked trade with the US. The European Union, India, Turkiye, and Gulf States are also expanding commerce with Africa, offering alternative markets that could help the continent assert greater trade sovereignty.

Economists recommend that African governments provide financial and regulatory support to businesses affected by sanctions. Trade incentives, diversification programs, and accelerated export agreements can help mitigate negative impacts and protect jobs.

Ultimately, the US remains highly relevant in global politics. Constant dialogue among nations is necessary to achieve lasting peace and shared prosperity.