A new ESCWA brief warns that new U.S. tariffs threaten $22 billion in Arab non-oil exports, with Morocco, Egypt, Jordan, and Tunisia facing $114 million in additional sovereign interest payments in 2025. Moroccan exports, however, may benefit from shifting U.S. trade dynamics, gaining ground as Chinese and Indian goods face higher tariffs. In a cautionary policy brief issued Saturday, the United Nations Economic and Social Commission for Western Asia (ESCWA) warned that «trade protectionism» by the United States—referring to tariffs imposed by President Donald Trump on U.S. trade partners—will significantly impact Arab economies. The Commission, composed of 21 member states from North Africa and the Middle East, estimates that this move could put $22 billion in non-oil exports at risk. For Morocco—along with Egypt, Jordan, and Tunisia—ESCWA predicts an additional $114 million in sovereign interest payments in 2025, following the implementation of the new tariffs. According to ESCWA, this increase stems from rising global bond yields and growing investor uncertainty, placing further pressure on public finances and potentially delaying development spending. Morocco may also feel the impact of slowing demand from key partners, notably the European Union, which currently absorbs 68% of the Kingdom's exports. Yet not all is negative. ESCWA notes that shifting U.S. trade dynamics may offer opportunities for trade diversion for Morocco and Egypt in particular. As American tariffs on Chinese and Indian goods increase, Moroccan and Egyptian exports could gain a competitive edge in the U.S. market, ESCWA said. However, the Commission cautions that the recent 90-day tariff pause—excluding China—could limit the extent of this benefit. Overall, total Arab exports to the U.S. have declined from $91 billion in 2013 to $48 billion in 2024, primarily due to reduced U.S. crude oil imports. Non-oil exports, on the other hand, have nearly doubled—from $14 billion to $22 billion—driven by growth in textiles, chemicals, aluminum, fertilizers, and electronics. That progress is now under threat. Jordan is among the most vulnerable, with nearly 25% of its exports bound for the U.S., while Bahrain's aluminum and chemical sectors are also flagged as high-risk. The UAE faces tariffs on an estimated $10 billion in re-exports to the U.S., primarily goods originating from third countries. ESCWA calls for stronger regional cooperation ESCWA emphasizes the need for stronger regional cooperation to navigate the crisis. It calls for accelerating the implementation of the Pan-Arab Free Trade Area, advancing the GCC Customs Union, and strengthening cooperation under the Agadir Agreement—a free trade pact between Egypt, Jordan, Morocco, and Tunisia that entered into force in 2007. Investments in logistics and regulatory harmonization are also seen as key to repositioning Arab countries in global value chains. «Despite the pressures, there is an opportunity here to accelerate structural reforms and deepen resilience», said ESCWA Executive Secretary Rola Dashti. «The region is at a strategic inflection point», she added. On April 2, President Donald Trump announced a new global trade policy imposing a 10% baseline tariff on all imports to the U.S. Morocco will be subject to this 10% tariff, which serves as the standard rate. While the primary targets are China, the European Union, and Canada, the move could also affect Morocco's trade with the U.S.—a relationship already marked by imbalance. In 2024, the U.S. trade surplus with Morocco reached $3.4 billion, a dramatic rise from just $35 million in 2005, one year after the two countries signed a Free Trade Agreement.
