Following Donald Trump’s latest warning to impose 100% tariffs on specific products sent to the United States, Kenya may face a run of mixed outcomes in global ties.
On Saturday, November 30, the US President-elect turned to Twitter to warn BRICS countries that if they pursued their plan to create a new currency to compete with the US dollar, they would face serious consequences.
“We require a commitment from these countries that they will neither create a new BRICS (which stands for Brazil, Russia, India, China, and South Africa) currency nor back any other currency to replace the mighty US dollar or they will face 100% tariffs and should expect to say goodbye to selling into the wonderful US economy,” Trump declared.
Egypt, the United Arab Emirates, Ethiopia, and Iran have recently joined the BRICS organization, which already includes Brazil, Russia, India, China, and South Africa.
Some of these member countries have openly stated an interest in de-dollarizing the global economy as a long-term strategy to quell the weaponization of the dollar by the US.
However, if Trump follows through on his promise of a 100% tariff at the US border, the cost of goods in BRICS member nations will rise to worrisome heights, destabilising global trade flows.
Trump’s stealth economic war on developing countries may have both beneficial and harmful consequences for secondary stakeholder countries such as Kenya.
On the one hand, the BRICS’ aim to reduce dollar dominance in the global financial system may have an impact on the Kenya Shilling, giving it additional strength.
However, imposing Trump’s proposed 100% tariffs on countries such as China, Kenya’s largest trading partner, might come at a significant cost.
BRICS countries are effectively unable to export their products to the US because 100% tariffs would make exports unprofitable for Americans.
This might diminish China’s export profits, impacting its GDP and, in turn, global trade between the Asian superpower and countries such as Kenya.China may therefore struggle to generate enough revenue to continue importing from Kenya and other nations.
According to a November 2024 study, Kenya spent Ksh451 billion on products and services imported from China, more than any other country.Kenya’s agricultural exports to China cover a wide range of products.
According to data from United Nations COMTRADE, ores, slag, and ash remain Kenya’s primary agricultural export to China, valued at $110.89 million (Ksh 14.3 billion) in 2023.
Other notable exports include edible fruits, nuts, citrus peel, and melons, valued at $25.69 million; fish and crustaceans at $18 million (Ksh2.3 billion); coffee, tea, and spices at $9.49 million (Ksh1.22 billion); and other textile and leather items.Kenya-US relations: Since Kenya’s independence in 1963, the two countries have maintained close ties.
According to the Office of the United States Trade Representative, US product exports to Kenya have been steadily increasing, expected to reach Ksh78.2 billion (USD 604 million) by 2022.
