As Donald Trump is inaugurated today for his second term, a local investment expert believes the USA’s economic policies, particularly Trump’s protectionist trade stance, are likely to negatively impact Namibia and Southern Africa as a whole. This is as the World Bank (WB) has cautioned that Trump’s proposed trade tariffs could potentially have worldwide economic consequences. 

He threatened to impose higher tariffs on China, Canada, and Mexico on the first day of his presidency. 

“His proposed tariffs on imports could reduce demand for Southern African exports and threaten the African Growth and Opportunity Act (AGOA), which supports trade with African nations. Additionally, Trump’s focus on domestic manufacturing may lead to reduced foreign investment in the region, further complicating economic relations,” said chief executive officer of Sanlam Investments Tega Shiimi ya Shiimi. 

Speaking to New Era yesterday, Shiimi ya Shiimi noted Namibia may face significant challenges under Trump’s renewed presidency., specifically due to his “America First” policies that could lead to reduced US foreign aid, impacting health and infrastructure projects vital for Namibia’s development. 

“Trump’s scept i c ism towards multilateral climate agreements threatens funding for environmental resilience initiatives, which are crucial for Namibia. Additionally, potential cuts to the AGOA could jeopardise trade benefits, affecting Namibia’s exports of beef, diamonds, and uranium. Conversely, there may be opportunities for increased trade partnerships if Namibia strategically positions itself in a competitive US-China landscape,” Shiimi ya Shiimi added. 

Also weighing in, a senior Namibian government official noted Trump’s policies could result in Namibia being caught between South Africa and the USA in terms of AGOA. 

“Our ports could end up being the saving grace for South African exports to the USA depending on what extra conditions could be imposed by South Africa. As for tariffs, the Trump regime is just following the Biden regime in terms of targeting Chinese products such as electric vehicles or stopping key technologies the Chinese would want to get from the USA to their factories. But the jury is still deliberating on whether they will succeed,” the official, preferring anonymity, commented. 

The official added that Namibia is most likely, based on Trump’s first term, to see some rather benign, as opposed to increased support, in development aid, climate change mitigation and public health. 

“In Trump’s previous term, there was also more emphasis on bilateral trade frameworks as opposed to multilateral frameworks. Such an approach is normally not good for us who depend on the export of raw minerals and agricultural goods,” the official stated. 

Meanwhile, the World Bank expects the global economy to flatline at 2.7% growth during 2025 in response to fresh fears, including new US tariffs. This would be the weakest global performance since 2019, not including the massive shrinkage experienced at the height of Covid-19. 

According to the World Bank’s deputy chief economist Ayhan Kose, this global growth rate is one the bank can “live with” but would not be enough to improve living standards in richer and poorer countries. In a recent statement, Kose noted that “escalating trade tensions between major economies” were one of the bank’s biggest fears for the global economy in 2025. 

Other WB worries include interest rates being kept higher for longer and increased policy uncertainty denting business confidence and investment. 

The World Bank said even a 10% increase in US tariffs on imports from every country would reduce global economic growth by 0.2% if countries did not retaliate. If they did, he added, the global economy could be hit harder. 

“Anytime you introduce restrictions on trade, there will be adverse consequences which are most often endured by the country that introduced them,” said Kose. “When you look over a longer time period, we think growth numbers will come down. That worries us,” Kose added. 

The WB considers economic growth as fundamental to reducing poverty and funding public services such as healthcare and education. Kose further warned there are no magic solutions for governments around the world grappling with different methods of boosting economic growth.