United Nations on Trade and Development (Unctad) says sparing the most vulnerable economies, including Malawi, contributing minimally to US tarrif revenue from disruptively high tariff burdens should be a priority.
This follows the United States’ departure from nearly a century of declining tariffs that once made its rates among the world’s lowest.
In its analysis ‘Mapping the size of new US tariffs for Developing Countries,’ Unctad says a window of opportunity still exists for policymakers to re-evaluate the planned country-specific tariffs, to safeguard sustainable development and avoid further economic instability.
Says Unctad in the analysis: “Vulnerable economies are set to pay the highest price for new US tariffs. Dozens of vulnerable economies are expected to lose competitiveness in the US market.
“Their exports often rely heavily on a narrow range of products and limited number of markets. Higher trade barriers can disrupt these trade flows, making it more difficult for these countries to maintain market access and remain competitive, especially in key sectors like textiles and agriculture.”
The US is substantially increasing its import tariffs for all its trading partners.
On April 2 2025, the US announced a universal 10 percent additional tariff on all imports, effective April 5, regardless of trade agreements or multilateral commitments under the World Trade Organisation (WTO) or unilateral preferential schemes for vulnerable economies (such as the African Growth and Opportunity Act, (Agoa), the Caribbean Basin Initiative).
According to UN data, Malawi could be remitting $7 million (about K12.3 billion) to the United States of America in potential custom duties annually from the reciprocal tariff of 18 percent announced on April 5 2025, but pending implementation.
However, as a percentage of US total custom duties in 2024, this represents a meagre 0.01 percent.
Unctad calculations based on US National Statistics based on 2024 data shows that Malawi’s US exports were at $27 million (about K47.3 billion).
Similarly, tea, which generated $13.1 million (about K23 billion), was mostly exported duty-free, the same with sugar, which generated $10.4 million (about K18.2 billion).
Earlier, Illovo Sugar (Malawi) plc communications and stakeholder relations manager Olive Kawelama said although the new tariff regime will not affect the production cost of sugar, it will significantly impact the market price due to the higher landed cost resulting from the increased tariff.
“This in itself provides different landed costs for different sugar producers, entailing different competitive positions.”
Kawelama indi c ated that currently, the Malawi Stock Exchange-listed sugar manufacturer is failing to meet its quota due to supply constraints, having exported only 1 526 metric tonnes last year.
Minister of Agriculture Sam Kawale is also on record having said that while government does not yet have information from buyers on the direct impact of the tariffs on Malawi tobacco, it is working on improving on tobacco quality to increase access to other market apart from the US.
Malawi’s exports to the US comprise mostly agricultural products such as tobacco, sugar, tea and nuts.
