In July 2025 a decision in Washington exposed Africa’s strategic fragility. President Donald Trump’s 30% tariffs on SA exports — retaliation for Pretoria’s stance on Israel and membership of the Brics bloc — hit $9.3bn worth of annual trade. It was more than an economic penalty; it was proof that trade is war by other means.
SA’s reaction has been fragmented. The Treasury calculated fiscal losses. The Reserve Bank monitored currency pressure. The department of trade, industry & competition searched for alternative markets. But no unified strategy linked these threads to the deeper imperatives of industrial resilience, security readiness or monetary strength.
This siloed response is common across the continent — and it leaves Africa exposed in a world where technology, supply chains and geopolitical leverage are increasingly fused.
The price of fragmentation
The consequences are visible. SA’s manufacturing share has fallen from 21% to 12% of GDP since 1994, not due to resource scarcity but because liberalised trade advanced without matching industrial and technology development. By contrast, South Korea tied trade incentives to technology transfer, climbing from textiles to semiconductors in one generation.
Across the continent resource wealth — from Angola’s oil to Zambia’s copper — is often exported raw, while value-added industries sit abroad. Without co-ordinated trade — industry — technology strategies, these advantages generate income but not structural power.
Secure, affordable energy underpins manufacturing. Manufacturing supports defence capability. Defence protects markets and trade routes. All three are strengthened by advanced technology — from automated production lines to artificial intelligence (AI)-enabled logistics and surveillance.
Opportunities already exist, but their execution must be financially and strategically integrated. Angola could refine crude in SA plants, then exchange part of the refined product for SA machinery or defence equipment, settling payments through the pan-African Payment & Settlement System or even stablecoins. This would bypass volatile dollar channels, anchor trade in non-US currencies, and strengthen the rand’s role as a regional reference currency.
SA, with its relatively deep capital markets, could structure currency swaps or product-for-product agreements across the region — for example, swapping refined fuels for agricultural machinery, or electricity exports for processed minerals — locking in predictable trade flows and reducing exposure to external shocks.
Mozambique’s gas reserves could be leveraged beyond simple export contracts. By integrating them into industrial corridors that produce hydrogen fuel cells, fertilisers and regional manufacturing inputs, the value chain extends into engineering, maintenance and logistics jobs that remain in Africa. These could be financed through Afreximbank-backed instruments, paid on a blockchain and partially hedged with stablecoin-based settlement systems to speed up cross-border transactions.
Such arrangements would not only keep more value on the continent but also stabilise trade relationships through predictable supply, shared infrastructure and mutual security interests. In effect, trade agreements become economic defence pacts — securing supply lines, currencies and industries simultaneously.
Defence as industrial policy
Security and industry are interdependent. SA’s defence sector, exporting over $300m annually, could grow by targeting regional needs: maritime patrol craft for Southern African Development Community (Sadc) coastlines, surveillance drones for border control, or armoured vehicles for peacekeeping missions. Funding through regional agreements and local currency settlements would keep the economic cycle within Africa.
Energy-independent platforms — solar-powered radar stations, hydrogen-fuelled patrol boats — would maintain readiness even under fuel supply disruptions. Each domestically produced system develops engineering capacity, sustains skilled employment and reduces reliance on external suppliers.
Technology can shorten Africa’s industrial learning curve. AI, automation and advanced manufacturing already allow faster, cheaper innovation — as seen with DeepSeek’s large-language model development at a fraction of Western timelines and budgets.
Nations that transformed from resource dependence to industrial leadership — Singapore, South Korea — did so by collapsing policy silos
AI can reverse-engineer machinery, optimise farming yields, forecast supply chain risks and streamline customs. Blockchain-based settlement systems can make cross-border transactions instant and secure, reducing exchange rate risk. These tools are strategic assets, not optional upgrades.
But the fundamentals still matter. Steel plants, machine tooling and base manufacturing are prerequisites for sustainable hi-tech sectors. Without them, Africa’s role in the Fourth and Fifth Industrial Revolutions risks being limited to consumption, not production.
When trade, currency systems, procurement, industrial policy and technology are planned as one, they reinforce. Exports create scale; scale drops costs; lower costs widen demand; wider demand stabilises prices, supports currency and funds R&D. SA’s advantages — autos, engineering, platinum group metals — fit this flywheel, but remain unlinked.
Durban’s expanding ship-repair hub, paired with Zambian steel processing and Cape Town navigation software, could meet Sadc fleet needs and export refits/components.
In agriculture, Nairobi’s precision weather models guide irrigation systems made in Egypt and assembled for orders, financed by Afreximbank and settled via the pan-African Payment & Settlement System. Larger orders keep factories at capacity, cut prices, trim imports, stabilise farmers and spur equipment exports.
Telecommunications can extend SA’s fibreoptic capacity via joint ventures with East and West African plants serving export markets. Larger runs lower prices, export earnings fund R&D, and common standards also harden networks and protect infrastructure.
In such arrangements trade is more than goods movement — it becomes the backbone of industrial capability, technological competence and long-term resilience.
A strategic lens for AfCFTA
Nations that transformed from resource dependence to industrial leadership — Singapore, South Korea — did so by collapsing policy silos. Trade linked directly to R&D, R&D to industrial targets, and both to national security priorities.
The African Continental Free Trade Area (AfCFTA) offers a $3.4-trillion platform to do the same. But success depends on whether agreements strengthen regional value chains, reduce external reliance, expand technological depth and align with security imperatives.
In an era of supply shocks, tariff weaponisation and sanction threats, Africa’s economic defence is as important as its military posture. An integrated framework is not just a growth strategy — it is a survival strategy.
As former Botswana president Festus Mogae observed, “Small nations survive through strategic thinking, not military power.” For Africa, that thinking demands treating trade, industry, energy, defence and technology as interdependent levers, pulled together rather than in isolation.
The choice is stark: design a fully connected economic defence strategy now, or remain vulnerable to external pressure later. The world is moving fast — Africa must move faster.
• Mafinyani is risk advisory & financial modelling partner at Decentralized Secured Finance.
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