End last month, the United Nations Economic Commission for Africa (UNECA) in Eastern Africa published a press release indicating that, among others, eastern African exports are demonstrating remarkable resilience amid global trade turbulence, defying expectations of decline following sweeping US tariffs and persistent geopolitical uncertainty.
Data from UNECA, it says, reveals that several countries in the region have not just weathered the storm but have significantly expanded their exports. In 2024, according to the press release titled “Eastern Africa defies global trade headwinds with resilient export growth,” total trade within the East African Community (EAC) surpassed for the first time $11 billion, marking a 22 percent increase from 2023. Intra-African trade also grew by 8.5 percent, far outpacing the 0.4 percent growth in exports to markets outside the continent.
In an interview with The New Times, Andrew Mold, the Director of UNECA in eastern Africa, shed light on their latest findings. He explained key factors behind the region’s unexpected resilience, and shared policy recommendations he thinks would help countries in the region to shift from raw commodity exports to more value-added, industrial exports.
The excerpts:
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Your regional office’s latest data shows eastern Africa defying global trade headwinds. What are the key factors behind this unexpected resilience?
Despite a very uncertain global context – huge uncertainty in the global trading system, concerns over financial markets, and declining development assistance – there have been several factors working in favour of the region’s economies in 2025.
Firstly, although debt levels remain a major concern, the weaking of the US dollar since the beginning of the year has definitely mitigated the negative impact of debt repayments – indeed a number of regional currencies have stabilized against the dollar, with the Ugandan shilling actually gaining ground against the US dollar.
Inflation has also been moderating in most countries, as global food prices have been moderating, and the oil import bill has also been declining, as prices of oil in global markets soften.
Another factor working broadly in favour of the region has been the export performance. Bulking global trends of a slowing down in trade, several countries in the region have seen very strong export growth, including Rwanda, Uganda and Tanzania – all seeing export growth between 20-30% last year, and with preliminary data for 2025 showing these trends to continue. The reason is tied up with high prices for some of the region’s major commodity exports – in particular, for coffee and gold. But other exports have also shown a good performance.
The story is not shared across the region, however, and a number of Eastern African economies, such as Burundi, Djibouti, and Madagascar, actually saw contractions in their exports in 2024. For each, the reasons were rather different. Djibouti’s trade was impacted by the instability in the Red Sea, Madagascar saw weak prices for its vanilla exports, and Burundi was dealing with the knock-on impacts of the privatization of the leading coffee exporter.
Your office’s press release highlights significant increases in exports to the US, particularly from DR Congo, Ethiopia, and Kenya. How much of this is due to trade diversion caused by U.S. tariffs on Asia, and how sustainable is this trend?
It is too early to tell definitively. But clearly a lot of changes are happening to global trading patterns due the US tariffs. China’s exports to the US declined by nearly a third in the period January-July 2025, compared with the same period the year before, according to US import data.
This has led to a sharp reorientation of China’s trade with the rest of the world. A number of countries, including Kenya, are observing a surge in imports coming from China, and of course raises some concerns over the ability of regional industries to compete. The fact that China has announced duty-free access to the Chinese market for African exporters is certainly a welcome development, but it remains to be seen if this will result in real enhanced market access and whether the existing non-tariff barriers will prove surmountable.
Intra-African trade within EAC surpassed $11 billion for the first time. What role is the African Continental Free Trade Area (AfCFTA) playing in this growth, and how can it be further leveraged?
The AfCFTA does not have a direct role in explaining the vibrancy of intra-EAC trade, as tariffs have already been removed on intra-EAC trade. But going forward, it will help sustain momentum towards not only the removal of non-tariff barriers, which remain a challenge for EAC member states, but also EAC trade with its near neighbours. It was encouraging, for instance, that earlier this month a convoy of Ethiopian trucks carrying coffee, meat, beans, fruits, edible oil, and manufactured goods crossed into Kenya through Moyale, under the Guided Trade initiative. Kenya and Ethiopia are the region’s largest economies, yet they barely trade with each other, with bilateral trade estimated at below 100 US$ million a year. So ultimately the greatest potential from the AfCFTA for the EAC as a bloc is to strengthen the trade and investment ties with other African countries.
By the way, I should stress that the US$11 billion figure is for six EAC members; Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda. If we add in the trade of the newer members, DR Congo and Somalia, the figure would be higher still.
Mineral exports now make up more than half of the region’s export basket while manufacturing declined to just 17.5%. How concerned are you about this over-reliance on commodities?
From the point of view of our member states, the export earnings are clearly welcome. It brings in much-needed foreign exchange, and boosts export performance. However, from a long-run perspective, this reliance on mineral exports brings with it associated problems.
One of the most consistent findings of economic research into this issue is that dependence on primary commodity exports, and particularly minerals, leads to lower long-run growth, and induces a lot of volatility in economic performance too. In part, for the simple reason that commodity prices are highly volatile. So, it is important that governments continue their efforts to diversify their sources of export earnings, and more away gradually from a dependence on primary commodities.
What policy recommendations would you offer to help eastern African countries such as Rwanda shift from raw commodity exports to more value-added, industrial exports?
A recommendation to our member states is to fully leverage the potential of the regional market to develop value-added and manufactured products. It is the easiest and fastest route to economic diversification. A lot of hopes have been pinned, in the past, on export diversified products to high-income economies. For the most part, these exports have not materialised, at least not to the extent as originally intended. And where they have, for example, clothing exports to the US under AGOA, the market access has proven to be less than permanent, causing a lot of problems for firms in these sectors.
The regional market for light manufacturing is vibrant, however, and there is also the demand for value-added products. Thus, for instance, Rwanda exported coffee to Ghana under the first iteration of the Guided Trade Initiative coffee – the country’s main traditional export. But this coffee was not the raw coffee, but the packaged final product ready to go on supermarket shelves in Accra.
We know from past value-chain studies that farmers perhaps capture 8-9% of the final price of a product like coffee. When Rwanda sells processed goods under the AfCFTA, it can capture a much higher share of the final price than compared to the coffee that is traded with Europe or the US. This is the way forward.
Given the uncertainty around the future of the African Growth and Opportunity Act (AGOA) arrangement, how should Eastern Africa prepare for a post-AGOA trade environment with the U.S.?
Our message would be principally that countries should not panic on this point – the US as an export destination accounts for less than 3% of Eastern Africa’s exports. The commodities that the region export should be broadly unaffected – the US needs African minerals and fuel as an input into its own production processes. An example of the veracity of this claim is the surge that we have seen from DR Congo in the period from April-July this year, compared with 2024, whereby exports have increased from around USD 120 million to close to USD 1.2 billion, driven largely by increased exports of copper and cobalt. Africa as a whole, since the beginning of the year has seen an increase in its exports to the US of 24% – so there should not be any fears of these exports suddenly drying up.
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It is true that the region’s clothing exporters could be impacted – principally, four countries that are exporting garments to the US under AGOA; Ethiopia, Kenya, Madagascar and Tanzania. But initial fears of a collapse of these exports do not yet seem to be founded – for the simple reason that the US has imposed much higher tariffs on its main sources of clothing – China at 30% and Bangladesh and Vietnam at 20%.
With the exception of Madagascar, which is hit by a 15% tariff, the other East African countries will face a 10% tariff. So, we don’t really know what the final result will be – how will big US retailers like Walmart make their sourcing decisions going forward? It could even possibly be that orders for clothing from Eastern Africa go up, given the sweeping and rather indiscriminate nature of the US tariffs on other producers of clothing. Time will tell…
Going forward, I don’t know what the prospects are for AGOA, though I think with the current US administration’s stance on these matters, there is little hope for a new AGOA-type agreement. Preferential market access seems to be an anathema to the current administration, as they want reciprocal trading arrangements. The question governments in the region have to ask is whether that is the kind of trading arrangement they want with the largest economy in the world. The EAC, as a regional body, has a high Common External Tariff – and there is an economic rationale to that, in terms of providing a degree of protection to the regional market. Are they prepared to chip away at that protection by, for example, granting US firms and farmers duty-free access to their markets? It is worthy of reflection.
