Sierra Leone’s exports to the USA will confront a 10% tariff, but specific products affected aren’t listed. Be that as it may, considering Sierra Leone’s export profile, likely impacted products may include:
Rutile and other minerals.
Agricultural Products: Exports like cocoa, coffee, and other agricultural commodities might also face the 10% tariff.
Other products : The country also exports other products like titanium ore, aluminum ore, and fish, but these might not be specifically destined for the US market.
Exports to the USA account for a moderately small portion of its GDP. According to the available data, in 2024, Sierra Leone’s total exports were valued at $1.54 billion, with the majority going to countries like China, South Korea, and the Netherlands.
As for GDP, Sierra Leone’s economy is valued at $7.41 billion in 2024, with a GDP per capita of $856.
IMPACT
A 10% US tariff on Sierra Leone’s exports would likely have a negative impact on the country’s GDP. Sierra Leone’s economy relies heavily on exports, particularly in the mining and agricultural sectors.
An increase in tariffs would make Sierra Leone’s exports more expensive for US consumers, potentially leading to a decrease in demand and subsequently, a decline in exports.
This decrease in exports would likely have a ripple effect on Sierra Leone’s economy, impacting various sectors, including employment, investment, and government revenue. As a result, the country’s GDP could contract, exacerbating poverty and inequality.
Trade Imbalance: Sierra Leone has a trade deficit with the US, which means it imports more from the US than it exports. A 10% tariff on Sierra Leone’s exports to the US could worsen this imbalance, potentially hurting Sierra Leone’s economy.
Key Trade Figures :
US Exports to Sierra Leone: $109.67 million
US Imports from Sierra Leone*: $29.61 million
So, as of 2024, the trade balance is $80.06million in favor of the US.
– Trade composition : Sierra Leone’s exports to the US are mainly raw materials like diamonds, iron ore, and cocoa beans. These products might become more expensive for US consumers due to the tariff, potentially reducing demand and affecting Sierra Leone’s export revenue.
– Economic impact: The tariff could lead to higher prices for Sierra Leonean goods in the US market, making them less competitive. This might result in reduced exports, lower government revenue, and a potential decline in GDP.
With Sierra Leone’s current GDP at $7.41 billion, let’s recalculate the impact of a 10% tariff on its exports to the US.
Sierra Leone’s Trade with the US
– Export Value : Sierra Leone’s exports to the US are valued at $27 million.
– Tariff Rate: A 10% tariff would increase the cost of these exports by $2.7 million.
Impact on GDP
– Tariff Cost as a Percentage of GDP*: The $2.7 million tariff cost would be equivalent to about 0.036% of Sierra Leone’s GDP ($7.41 billion).
It’s worth noticing that Sierra Leone is not alone in facing US tariffs . Numerous African countries are subject to varying tariff rates, ranging from 10% to as high as 93% in the case of Madagascar. However, the impact of these tariffs can be particularly severe for smaller economies like Sierra Leone, which depend heavily on international trade to drive growth and development.
Any slowdown in China would matter more to Sierra Leone. The share of Sierra Leone’s exports going to China is triple that going to the US. It does not look likely that US taxes will cause a very high amount of pain to China, or to its trading partners.
Top Export Partners :
– China: 18.3% of Sierra Leone’s global exports, with a value of $1.03 billion in 2023
– India: 96.5 million
– Belgium: 72.5 million
Sierra Leone should be worried because taxes are inflationary, and they might prompt the US Federal Reserve to raise interest rates, or cut interest rates.
In conclusion, whereas the 10% USA tax might have a negative impact on Sierra Leone’s GDP, the extent of this impact will depend on various factors, including trade agreements and diversification efforts. Sierra Leone must diversify our exports, the trouble is President Bio doesn’t understand the ECONOMY.
