Africa-Press – Botswana. The recent 37 per cent tariff hike imposed by the United States (US) on diamond imports from Botswana highlights a major shift that will have significant impact on the country’s economic status.
This move comes under US President Mr Donald Trump’s administration, which has adopted a more protectionist stance in global trade, moving away from multilateralism and globalisation.
In an interview on Monday, an Economist, Mr Sennye Obuseng expressed serious concerns about the implications of this tariff increase.
He noted that the US was effectively at ‘war’ with not just developing nations, but the entire world in terms of trade relations.
Mr Obuseng said the tariff hike was particularly detrimental to Botswana, as the US had been the largest market for its economic mainstay, diamond exports, and the price increase would deter consumers, compounding issues for an already struggling industry.
His insights underlined the broader negative ramifications of trade wars, which seldom yield winners, leading to reciprocal losses, citing predictions from one of America’s biggest banks’ JP Morgan.
Mr Obuseng pointed out that the US economy might be heading towards a recession, reinforcing the notion that disruption in the American economic landscape could have ripple effects globally.
With reflection on other nations, especially in Western Europe and Canada, Mr Obuseng said the duo would need to reassess their economic relationships and seek new trading partners as a result of the US’s new tariff policies.
For African countries, including Botswana, he suggested that there was a crucial need to revise trade policies and enhance intra-African trade as outlined in the African Continental Free Trade Area initiative (AfCFTA).
He said this crisis paints a picture of a complex global economic scenario, where tariffs and trade wars have far-reaching implications. Therefore, he urged African nations to strategise and build resilient economies, while also hinting at potential domestic pressures within the US from its citizens who oppose the administration’s trade decisions.
He noted that this was a developing world crisis, and further trade related decisions were yet to unfold from both developing countries and powerhouses.
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