Understanding the impact of US tariffs on Zim exports

The recent announcement of an 18 percent tariff on Zimbabwean exports to the United States, effective April 2, 2025, is set to reshape trade dynamics between the two nations.

This development follows the Trump Administration’s broader policy of imposing reciprocal tariffs on various countries.

Given that Zimbabwe exported $67.8 million worth of goods to the U.S. in 2024 according to U.S. trade statistics, this tariff could have significant implications for exporters and business leaders in the country, as U.S. importers may shun away from countries that attract high tariffs when selling to the U.S. market.

However, trade between Zimbabwe and the United States has historically been limited, with major exports including sugar, tobacco, and ferroalloys.

According to the Observatory of Economic Complexity, Zimbabwe exported $119 million worth of goods to the U.S. in 2023, with ferroalloys accounting for 52.8 percent of the total, followed by raw tobacco at 21.9 percent and raw sugar at 12.2 percent, as shown in Figure 1.

While some products already faced substantial duties—tobacco, for instance, had a 27 percent tariff—this broad-based tariff increase will add pressure to U.S. importers who were incurring little to no extra charges on goods imported from Zimbabwe.

The observatory of economic complexity (2025)

Before the new tariff policy, Zimbabwean products entering the U.S. faced varying tariff rates. Tobacco and tobacco substitutes were subject to a 27 percent tariff, while apparel and clothing accessories faced a 14 percent levy.

Raw hides and leather had a minimal tariff of 1 percent, whereas edible fats and oils were charged 3 percent. Sugar and confectionery products encountered a 12 percent tariff.

With the new tariff structure, all Zimbabwean exports to the U.S. will now face an 18 percent tariff, potentially reducing competitiveness in the American market.

The Trump’s administration justified the tariff using a formula based on the trade deficit between the two nations, which stood at $24.1 million in 2024.

By estimating the average tariff Zimbabwe imposes on U.S. imports at 35 percent, Washington set a “discounted reciprocal tariff” of 18 percent on Zimbabwean goods.

This development comes at a critical moment in Zimbabwe-U.S. relations. For years, Zimbabwe has pursued a Look East Policy, prioritising economic ties with China, Russia and other Asian economies.

This strategic pivot was largely driven by longstanding U.S. sanctions, which constrained financial transactions and access to Western markets.

However, the March 4, 2024, Executive Order by the Biden Administration marked a turning point by lifting sanctions on most individuals and corporations, as well as easing financial restrictions.

This move was expected to improve Zimbabwe’s economic relations with the U.S. and create new opportunities for trade and investment.

The imposition of the new tariffs risks reversing the progress made since the sanctions were lifted. Increased costs for Zimbabwean exports could discourage businesses from expanding trade with the U.S. due to the strain on competitiveness, reinforcing reliance on Eastern markets.

The tariffs may also dampen confidence among investors who viewed the Executive Order as a step towards economic reintegration with the West. For Zimbabwe, this presents a dilemma: whether to persist in strengthening ties with the U.S. or continue deepening economic engagements with traditional partners in the East.

Zimbabwe’s response should combine diplomatic lobbying, market diversification, industrial policy, and value addition to mitigate the impact of U.S. tariffs.

By shifting towards regional trade, strengthening ties with emerging economies, and increasing local processing capacity, Zimbabwe can turn the tariff challenge into an opportunity for long-term economic resilience.

The increased tariffs are expected to reduce export competitiveness, encouraging businesses to seek alternative markets. Sectors reliant on U.S. demand, such as mining and agriculture, may experience reduced output or shifts in investment priorities. The policy may also influence Zimbabwean authorities to explore trade negotiations, leveraging regional agreements or diplomatic channels to mitigate the impact.

In conclusion, the imposition of an 18 percent tariff on Zimbabwean exports to the U.S. presents both challenges and opportunities.

While it may strain existing trade relations, it also offers Zimbabwean businesses an impetus to explore new and alternative markets, enhance product value, and strengthen regional trade partnerships. Business leaders must proactively adapt to this evolving trade environment to sustain growth and competitiveness in global markets.

This article was prepared by the Zimbabwe National Chamber of Commerce for Business Weekly