Ghana-US Trade Relations: Dr. Theo Acheampong Warns Government Against Retaliatory Tariffs on US Imports
Petroleum Economist and Political Risk Analyst, Dr Theo Acheampong, has cautioned Ghana against applying retroactive tariffs to US-imported products in view of the 10% export tariff slapped on the country by President Donald Trump.
Such a move by the Government, Dr Acheampong notes, will only result in “cost-passthroughs” that will mostly be felt by Ghanaian consumers, increasing already high inflationary pressures that the Central Bank of Ghana is struggling to control.
“Should Ghana also respond by applying/increasing retroactive tariffs to US-imported products? ๐ฃ๐ฟ๐ผ๐ฏ๐ฎ๐ฏ๐น๐ ๐ป๐ผ๐! ๐ช๐ต๐? ๐ง๐ต๐ฒ ๐ฐ๐ผ๐๐ ๐ฝ๐ฎ๐๐-๐๐ต๐ฟ๐ผ๐๐ด๐ต ๐๐ถ๐น๐น ๐บ๐ผ๐๐๐น๐ ๐ฏ๐ฒ ๐ณ๐ฒ๐น๐ ๐ฏ๐ ๐๐ต๐ฎ๐ป๐ฎ๐ถ๐ฎ๐ป ๐ฐ๐ผ๐ป๐๐๐บ๐ฒ๐ฟ๐, increasing already high inflationary pressures that the central bank is struggling to control,” he noted.
“This is not to say we shouldn’t worry as Ghana will feel the second round of inflationary cost pass-through, not because of imports and exports with the US but in other countries like China and others, whose input costs may rise and will be felt by all economies, including Ghana. There are major external headwinds,” he added.
Ghanaโs duty-free access to the US market under the African Growth and Opportunity Act (AGOA) has been abruptly terminated with a 10% tariff imposition on exports to the US market, marking a significant blow to the countryโs export sector.
The move comes as part of Washingtonโs newly announced reciprocal tariff measures, which have also affected several major economies, including China, Vietnam, the European Union, and even Israel.
According to Dr Acheampong, ๐จ.๐ฆ. ๐ด๐ผ๐ผ๐ฑ๐ ๐๐ฟ๐ฎ๐ฑ๐ฒ ๐๐ถ๐๐ต ๐๐ต๐ฎ๐ป๐ฎ ๐๐ฎ๐ $๐ฎ.๐ญ ๐ฏ๐ถ๐น๐น๐ถ๐ผ๐ป ๐ถ๐ป ๐ฎ๐ฌ๐ฎ๐ฐ. This breaks down as $967 million of goods exports to Ghana and $1.2 billion of imports (a decrease from 2023 levels), the resulting trade deficit forย Ghana was $204 million.
๐จ๐ฆโ๐๐ต๐ฎ๐ป๐ฎ ๐๐ฟ๐ฎ๐ฑ๐ฒ ๐บ๐ฎ๐ธ๐ฒ๐ ๐๐ฝ ๐ฟ๐ผ๐๐ด๐ต๐น๐ ๐ฒ% ๐ผ๐ณ ๐๐ต๐ฎ๐ป๐ฎโ๐ ๐๐ผ๐๐ฎ๐น ๐ณ๐ผ๐ฟ๐ฒ๐ถ๐ด๐ป ๐๐ฟ๐ฎ๐ฑ๐ฒ ๐ผ๐ป ๐๐ต๐ฒ ๐ถ๐บ๐ฝ๐ผ๐ฟ๐ ๐๐ถ๐ฑ๐ฒ. In contrast, ๐๐ต๐ถ๐ป๐ฎ-๐๐ต๐ฎ๐ป๐ฎ ๐๐ฟ๐ฎ๐ฑ๐ฒ ๐ถ๐ ๐ญ๐ฏ% ๐ฎ๐ป๐ฑ ๐ญ๐ด% ๐ผ๐ป ๐๐ต๐ฒ ๐ฒ๐ ๐ฝ๐ผ๐ฟ๐ ๐ฎ๐ป๐ฑ ๐ถ๐บ๐ฝ๐ผ๐ฟ๐ ๐๐ถ๐ฑ๐ฒ, respectively.
๐๐ ๐ฝ๐ผ๐ฟ๐๐ from Ghana to the United States (2023) were primarily crude petroleum (71%), cocoa beans and cocoa paste (13%). ๐๐บ๐ฝ๐ผ๐ฟ๐๐ comprised largely cars (25%), and refined and crude petroleum (23%).
“๐ง๐ฎ๐ฟ๐ถ๐ณ๐ณ๐ ๐บ๐ฎ๐ ๐น๐ถ๐ธ๐ฒ๐น๐ ๐ฎ๐ณ๐ณ๐ฒ๐ฐ๐ ๐ฐ๐ผ๐ฐ๐ผ๐ฎ ๐ฝ๐ฟ๐ผ๐ฑ๐๐ฐ๐๐, ๐ถ๐ป๐ฐ๐น๐๐ฑ๐ถ๐ป๐ด ๐ฏ๐ฒ๐ฎ๐ป๐. However, given the complex value chain dynamics around how they are traded, I don’t see this significantly affecting petroleum products,” he added.
