The New U.S. Tariff Policies with Low Vulnerability to Ghana’s Economy
As the United States implements significant protectionist trade policies, Ghana appears positioned to navigate these changes with minimal disruption. Recent findings from Fitch Solutions reveal that Ghana ranks among the least vulnerable Sub-Saharan economies amid the rise in U.S. tariffs.
In a regional index that evaluated exposure to these reciprocal trade measures, Ghana placed 42nd out of 48 economies, indicating a less severe impact compared to neighbouring countries. The projected effective tariff rate for Ghana is 10%, considerably lower than the high rates anticipated for nations such as the Democratic Republic of Congo and Somalia.
Fitch Solutions’ analysis highlights potential challenges for specific Ghanaian export sectors, particularly cocoa, textiles, and agricultural products. These sectors, which are crucial to the non-oil export economy, might face reduced competitiveness in U.S. markets if importers seek alternative sources to avoid increased costs.
According to Fitch analysts, Ghana’s diversified export profile and limited dependency on U.S. markets serve as a buffer against direct negative impacts. However, some niche sectors may still face demand challenges. Despite these concerns, Ghana’s economic outlook remains stable compared to the broader Sub-Saharan region, where oil-dependent economies are under pressure.
Countries like Angola and Nigeria are particularly vulnerable due to their reliance on oil revenues, which are threatened by the recent drop in Brent crude prices. If global oil prices continue their decline, these nations may experience significant fiscal and currency challenges. As the U.S. average tariff rate reaches a historical high, the impact of these policies is felt across emerging markets, although Ghana’s resilience offers a hopeful perspective.
Source: ModernGhana