Why poor countries won’t lose out from the US-China Trade War

 In op-ed

A Kenyan saying goes, “When two elephants fight, it’s the grass that suffers”.

News headlines over the past few weeks have been dominated by two “elephants”, the US and China, and what looks like the beginning of a protracted trade war between them. The war will most likely affect their economies negatively in the short-term as the costs of various goods rise due to higher tariffs.

But what for the rest of the world, and especially poor countries?

In principle, and looking at it very simply, the tariffs that the US has slapped on China should be bad for most African, Caribbean, and Pacific (APC) countries, for two reasons.

First, the tariffs are on natural resources (steel and aluminium) and a wide range of manufactured goods which ACP countries would also like to export to the US if – and it’s a big IF – they had the manufacturing capacity to do so.

Second, World Trade Organisation rules stipulate that the US cannot single out China, which means ACP countries must also be subject to the same tariffs. Countries that don’t have the resources, relationships, or power to quickly negotiate exemptions (such as Canada, Mexico, and Australia) will be hit as well. Hence, South Africa is already concerned about its steel exports to the US.

On the other hand, the tariffs China has slapped on the US could, in principle, be beneficial to ACP countries. The tariffs are primarily on agricultural goods, which ACP countries have an abundance of.

Since 2003, least developed countries around the world have been granted exemptions from China’s tariffs – now for 95% of their export categories. Indeed, as the OECD has shown, agricultural goods receive huge financial subsidies in the US (as well as Europe), so any shift in the balance to reflect their true price will benefit countries that do not and cannot subsidise their exports so heavily.

But all of these costs and benefits are in principle only, and they are also static. Economic theory is always in favour of more, cheaper trade to bolster global growth. Most ACP countries are major importers of manufactured goods from both China and the US, so if the costs of those goods rise without a corresponding boost in export values their economies will certainly lose out.

Numbers-wise, 43 of the 55 countries of the African continent – that’s almost 80% of them – can expect their trade deficit with China to rise. The Caribbean and Pacific region has a similar deficit.

Furthermore, ask most ACP officials whether tariffs matter to their trade, and they will say “not much”. It’s the other aspects of trade – the certification requirements, the understanding of markets in large countries, the transport costs – that matter more. It’s these often costly, non-tariff barriers which stop their products getting into large markets such as the US and China.

Indeed, six years ago a United Nations analysis showed that only 50% of agricultural products from least developed countries did enter China duty-free, despite the preferential scheme.

The sad fact is, the balance of global trade is already so out of kilter vis-à-vis ACP countries that it is hard to say if they will lose much more from a US–China trade war, even if it’s protracted.

Just before the US imposed tariffs on China, it removed Rwanda from a preferential trade scheme that is meant to allow zero-tariff access to the US for more than 6500 product lines. This was because of one policy in Rwanda designed to protect its fledging domestic textiles market, which Chinese investors are increasingly interested in.

That said, Americas preferential scheme covers twice as many product lines than China’s, and covers 39 African countries compared to 33 for China.

But if anyone deserves protection at this increasingly protectionist time it is ACP countries and other least developed countries around the world. They are now the fastest growing countries, with the largest youth populations who need jobs to lift themselves permanently out of poverty.

These countries are doing their best to protect themselves – the recently agreed African Continental Free Trade Agreement is a great example – but they need protection from others, because they should win from this war.

How could they win? Both the US and China can help, as can OECD countries and regions such as the EU, Canada, and Australia. These regions should work to ensure ACP countries are immediately and consistently exempted from tariffs on 100% of their exports, whether raw, partially, or fully manufactured in those countries.

OECD countries and regions should also take immediate action to remove non-tariff barriers, such as phytosanitary certificates, to their bare minimum. As long as goods have clear labels of origin and contents, consumers, not customs officials, should be the ones to decide if they are good enough for their use.

And it will be in the OECD countries’ self-interest to do so. Most now operate and promote “aid for trade” programs for poor countries around the world. If action is not taken to both protect and boost ACP countries to make the most of the China–US trade war, this taxpayers’ money – currently valued at more than $50 billion – will be wasted, and an opportunity for leverage missed.

The current trade war between the two elephants, China and the US, is certain to trample the grass in some countries. Sadly, these are the fortunate ones, as they have already secured markets in the US and China.

We should seize the opportunity and take action now to grow more grass around the world, and to make trade mean something to more ACP countries in future.

This op-ed was first published on the Lowy Institute’s Intepreter on 16th April 2018. You can find the original post here.

Recommended Posts

Leave a Comment

Contact Us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Not readable? Change text. captcha txt


Research Analyst

Edmond is a research analyst who is passionate about sustainable development, innovation, and the environment. Passionate about climate financing, he firmly believe there is a more reliable system to promote equality, growth, and welfare in societies without affecting the ecosystem. Through his skills, knowledge and experienced gained over 7 years, he wants to make an impact in the world of development. Edmond holds a Master’s Degree in Public Policy from Korea Development Institute and a BA Degree (Honors) in Business from University of Derby.


    Founder and CEO

Hannah Ryder is the Founder & CEO of Development Reimagined. A former diplomat and economist with 20 years of experience, named one of 100 most influential Africans in 2021, she is also Senior Associate for the Africa Program of the Center for Strategic International Studies (CSIS), sits on the Board of the Environmental Defence Fund, and is a member of UAE's International Advisory Council on the New Economy. Prior to her role at DR, Ms Ryder led the United Nations Development Programme (UNDP)’s work with China to help it scale up and improve its cooperation with other developing countries, including in Africa. She has also played various advisory roles for the UN and OECD and co-authored the seminal Stern Review of the Economics of Climate Change in 2006.


Deputy Director

Leah Lynch is Deputy Director of Development Reimagined (DR), and head of the China office. Leah has over 10 years of experience in development and has lived in China for over 8 years. Leah has also travelled extensively around Asia and Africa for research. Leah supports the strategic direction of the team across China, with a mission to deliver high quality research on sustainable development and poverty reduction. Leah is also Chair of the Sustainability Forum at the British Chamber of Commerce in China, providing direction on sustainability initiatives for British and Chinese business. Leah has also consulted on various evaluations on UK aid (ICAI) and is a specialist on development cooperation from the UK and China. Leah has also consulted on various UN projects, including providing support to the UN China team during the COVID-19 Pandemic. Prior to DR, Leah was at the United Nations Development Programme (UNDP) China, supporting the UN’s portfolio on communication strategies, China’s South- South Cooperation and the Belt and Road Initiative (BRI). Before UNDP, Leah lived and worked in Kenya developing sustainable water policies for the Kenyan government.


China-Africa Policy Analyst

Yike Fu is a Policy Analyst and has been responsible for leading numerous areas of work, including on debt analysis in Africa and beyond, and China-Africa trade and investment logistics and analysis. She is the co-author of “African Debt Guide”, in which she challenged the narrative that Africa is in the midst of a new debt crisis by analysing data back to the 1970s and adopting new metrics to present the real story behind the data. She also developed a benchmark to compare the financial distribution of development partners such as the UK, US, Japan, France and China in Africa. Prior to her role at DR she worked at the International Finance Corporation and African Union Representational Mission to the US. She holds a Masters in International Affairs from George Washington University.


Research Analyst

Judith is a Research and Policy Analyst, where she specialises in Africa-China relations, international development, and diplomacy. During her time at Development Reimagined, Judith has co-authored several articles published in The Diplomat on debt and China-Barbados relations and was quoted by China Daily in a piece on Women Rights in China. Previously, Judith worked as a research analyst for an Advocate and Commissioner and Oats office in Kenya.


Policy Analyst

Ovigwe specialises in geopolitics with particular reference to Africa in a changing Global Order. He is adept at critically analysing the politics of contemporary development processes and providing insight into the geopolitical interests that influence them. His work includes research, publications, tailored briefings and advising on global and regional trends, and issues at the nexus of geopolitics and development. Ovigwe appears frequently in media around the world such as Al Jazeera, TRT World, SABC, CGTN, BBC Radio, and other platforms.


Policy Analyst

Jing leads China-African health and agriculture cooperation research at Development Reimagined, having managed our FOCAC Policy Analysis and Advocacy project. She is also the co-author of “China-Africa Health Cooperation under FOCAC Umbrella”, in which she analysed China’s commitments around health cooperation since the first FOCAC summit and deepdived into four African countries’ health overview, challenges and cooperation with China as cases studies. Before DR, Jing worked at GIZ Cambodia on M&E of a disability advocacy project. She also worked as a translator with Chinese medical team in Benin.


Trade Policy Analyst

Patrick is an International Trade Policy and Trade Law Expert with over 5 years of experience. His expertise includes trade law, trade policy analysis and regional integration. He is currently engaged with Development Reimagined as a Senior Trade Analyst and was the lead author of Development Reimagined's recent Report on Africa-China Relations titled "From China-Africa to Africa- China: A Blue Print for a Green and Inclusive Continent-Wide Strategy Towards China." and “Reimaging FOCAC Going Forward.” Patrick has previously consulted for the East African Community, UNECA and for the Kenya Ministry of Trade.


Senior Policy Analyst 

Rosemary is our Senior Policy Analyst. She is a skilled policy analyst and has previously worked as a UK civil servant. She is studying Human Rights at Birkbeck, University of London with a research focus on international law in the context of health crises such as the COVID-19 pandemic.


Project Manager and Africa-China Communication Assistant

Jade is a Project Manager for Development Reimagined’s flagship project Africa Unconstrained, which focuses on financing needs and debt vulnerabilities of African countries. Her research focuses on China-Africa development finance alongside debt vulnerabilities, infrastructure needs and South-South cooperation. She has worked with a breadth of stakeholders from China, Africa and the wider international community, including governments, private sector, NGOs and civil society. Her writing has appeared in a number of publications, including The Africa Report, The China-Africa Project, The Diplomat and more. Jade holds a Master’s in China and Globalisation studies from King’s College London.


Programme Manager

Rosie is the Project Manager of Africa Reimagined (AR) at Development Reimagined (DR) where she supports high-end African brands with entering the Chinese market by operating services such as trademark protection, Chinese market research, Chinese partnership building, and Africa to China logistical support and import/export services. Rosie has worked with DR for over two years now with proven success in helping high-end African brands navigate the Chinese market. She is extremely passionate about her work because more African brands selling in the Chinese marketplace means African countries can export MORE value-added goods, create MORE jobs and foster MORE innovation in African countries.

Rosie is also alumni of the School of International Studies at Peking University in Beijing where she is also an editor at the Peking Africa Think Tank. PATT is led by a diverse group of scholars who specialise in African Studies within the context of Sino-Africa relations.



Lauren has lived in six countries from the Americas to Europe and Asia and speaks both French and Spanish proficiently. At Development Reimagined, Lauren’s research focuses on climate action both in the Asia-Pacific and in Africa, and how countries are using tools such as SDGs and Covid-19 action to build a more climate-resilient future. She holds a Masters in International Relations from Leiden University.



Etsehiwot holds a Masters’s degree in Development Studies from the London School of Economics. She has diverse experience in humanitarian and development issues by working in both multilateral organizations and international non-governmental organizations. Etsehiwot is currently a consultant focusing on the SDGs and development finance.


Economist Consultant

Dibekulu is an economist by training. He holds an MSc in International Development Studies from Palacky University Olomouc, an MSc in Development Economics from the University of Clermont Auvergne, and an MSc in Economics, Finance, and International Integration from the University of Pavia. At Development Reimagined, he works as an Economist consultant. He has strong data analysis skills, with research interests centring around development finance, impact assessment, food security, and agricultural insurance.


Project Manager

Osaru is a health professional with an MSc in Health Systems Policy and an interest in women’s health and population management. At Development Reimagined, she applies her health sector experience to global health research and collating locally applicable development insights from China.


Research Analyst

Ferdinando’s research at Development Reimagined is centred on South-South Cooperation dynamics, specifically on the analysis of Chinese investment and debt flows in Africa and their linkages to African industrialisation. He is currently a Yenching Scholar at Peking University, after having graduated from the University of Cambridge with an MPhil in Development Studies.


Research Analyst

David is a Research and data analyst at Development Reimagined. His scholarly focus is mostly on interdisciplinary research in demographic economics and development with interests in migration, economic development and policy, education, health and subjective well-being. He is currently a PhD scholar at Nelson Mandela University from which he also holds B.com Economics and Statistics and M.com respectively.


Research Analyst Kenya

Ivory is a Kenyan lawyer with experience in policy research and analysis. She also supports the communications team at DR. Ivory speaks English, Swahili and French.


Research And Data Analyst China 

Joy Ene is a Research and Data Analyst at DR. Joy is passionate about African/global development, poverty eradication and trade policies between underdeveloped and developing countries. She is also a fourth-year student of International Economics and Trade at the  Liaoning University, Shenyang, China. She serves as the President of the Student Union, Liaoning University, International Students chapter.


Research Analyst 

Chensi Li is a research analyst. She has previously worked for local NGOs in Nigeria and Cameroon and think-tanks in China.  Her research areas include Sino-African relations, African foreign affairs, public diplomacy, state-building and national governance.

Yixin Yu

Research Analyst 

Yixin is a Junior Research Analyst and her focus areas is on public-private partnership and entrepreneurship. She has over three years of working experience in both private and public sectors in Ethiopia. She was the China Liaison Officer for project ‘Partnership for Investment and Growth in Africa’ at International Trade Centre, where she accumulated rich experience in investment and trade promotion


Founder and CEO

Hannah Ryder is the Founder & CEO of Development Reimagined. A former diplomat and economist with 20 years of experience, named one of 100 most influential Africans in 2021, she is also Senior Associate for the Africa Program of the Center for Strategic International Studies (CSIS), sits on the Board of the Environmental Defence Fund, and is a member of UAE's International Advisory Council on the New Economy. Prior to her role at DR, Ms Ryder led the United Nations Development Programme (UNDP)’s work with China to help it scale up and improve its cooperation with other developing countries, including in Africa. She has also played various advisory roles for the UN and OECD and co-authored the seminal Stern Review of the Economics of Climate Change in 2006.