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Morocco World
23-07-2025
- Business
- Morocco World
Geo-Economic Gamechanger: Washington's New Strategy for Africa
Geoeconomics, defined as the use of economic instruments to achieve geopolitical goals, has become a central element of states' foreign policy. States use a wide range of geo-economic tools, from trade policy to sanctions, investment, cyberspace, development aid, financial and monetary policies, and energy and commodity policies. The aim is to promote and defend their national interests and achieve beneficial geopolitical results. The end of the Cold War resurrected the 're-geoeconomization' of international relations. Edward Luttwak theorized a world in which state competition would be carried out by economic rather than military means. Robert D. Blackwill and Jennifer M. Harris insist that geoeconomics involves the use of economic instruments to produce favorable geopolitical outcomes. ('War by other means, geoeconomics and statecraft' (2016). Historically, this approach is not new, as illustrated by mercantilism (1500-1750), where national wealth and military power were inseparable 'economic weapon' emerged and became systematized, particularly during the First World War. During this period, countries such as Britain and France developed sophisticated techniques such as blockades to deprive the enemy of vital resources. Among these methods were the establishment of blacklists for companies trading with the enemy, preventive buybacks to acquire essential resources and remove them from the adversary, the financial blockade and asset freeze to control banking operations and 'navicerts', navigation permits to circumvent the maritime blockade. In the twentieth century, this approach continued to evolve; the Axis powers (Germany and Italy) sought autarky in response to blockades and sanctions, in order to reduce their dependence on vital imports. After World War II, the Marshall Plan was a notable example of the use of geoeconomic tools for geopolitical purposes, aimed at rebuilding Europe and containing Soviet influence. During the Cold War, embargoes and export controls were used against the Soviet bloc, such as the American embargo on 'red oil' (Mattei affair CEO of the ENI and the overthrow of the Mossadaq government in Iran) in the fifties and sixties, or on cereals against the Soviet invasion of Afghanistan or Russia's blockade of Ukrainian grain exports are eloquent examples. Nowadays, China uses its economic means, such as investment (notably through the Belt and Road Initiative – BRI) and technological sanctions or export controls on rare minerals, to expand its influence and contain its rivals, diversifying its trade routes to reduce its vulnerability to USA-controlled choke points. Russia is also using energy as a strategic lever, suspending gas supplies to Europe and acquiring gas companies in neighboring countries for geopolitical reasons. The shale gas and oil revolution in the United States gives Washington a powerful new geoeconomic instrument, potentially reducing Russia's energy influence on Europe and facilitating the imposition of sanctions on oil exporters. Africa : a hotbed of geo-economic competition between the great powers Africa has become a central stage for the competition of the world's superpowers seeking to expand their influence, marking a new 'Cold War' no longer bipolar but multipolar, involving mainly the United States, China and Russia, as well as former colonizers and other non-African middle powers (Turkey, Qatar, UAE, India). The aim of these powers is to convince African countries that their 'partnership' is best suited to their needs, sometimes pushing the continent to choose sides, however, African voices, such as former President Macky Sall and Paul Kagame, insist on the continent's right to sovereignty and non-exclusivity in its relations, claiming that Africa aspires to be a stage of international cooperation rather than an arena of competition between great powers wants to work and trade with everyone. The strategies of the superpowers in Africa vary widely: the United States promotes good governance and democracy on one side, African Growth and Opportunity Act (AGOA) and USAID on the other, while criticizing China's perceived coercive or 'debt trap' practices. China, through the Belt and Road Initiative (BRI), dominates economic engagement with massive infrastructure loans and significant foreign direct investment, seeking to align the global economic order with its interests. While Russia focuses its engagement mainly on the military sector, being the largest supplier of arms to Africa, and is also involved in intelligence and security, but its economic influence remains weak compared to others. On overall, while China consolidates its influence through infrastructure and natural resource-backed loans, the U.S.A continues to wield power through its aid and market access through AGOA and soft power. – The data analysis of the Formal Bilateral Influence Capacity (FBIC) Index from 2000 till 2020, developed by the Diplometrics Program at the Josef Korbel School's Pardee Institute (which measures the formal influence that one country can exert over another across economic, political, and security domain) reflects a shift toward multipolar competition in Africa, with traditional Western powers losing ground to new assertive players, notably China and Russia, signaling a reconfiguration of geopolitical alignments on the continent. Between 2000 and 2020, China emerged as the most influential permanent member of the UN Security Council in Africa. Its influence grew rapidly from a low baseline to a peak around 2014, driven by large-scale infrastructure investments, strategic partnerships, and its Belt and Road Initiative. While France initially held the leading position, its influence gradually declined after 2017, reflecting growing resentment toward its presence, particularly in the Sahel. The United States maintained a steady influence for most of the period but experienced a slight downturn after 2016, possibly due to a strategic pivot toward Asia and diminishing engagement in African affairs. Meanwhile, Russia steadily increased its influence, though from a lower starting point, leveraging military cooperation, arms deals, and anti-Western rhetoric. The United Kingdom showed limited impact, with a slight rise until 2013 followed by a steady decline, likely accentuated by post-Brexit diplomatic and economic adjustments (Conclusion of new trade agreements to substitute former EU arrangements). – Besides, the results of another in-depth analysis of the economic dependence indices of African countries vis-à-vis the United States and China, which we carried out for the purposes of this article, reveal a geopolitical kaleidoscope of countries influenced by one or the other of the superpowers. Zambia, Angola, the Democratic Republic of Congo and Djibouti are among the countries most dependent on China, with high levels of debt, infrastructure investment and trade links with Beijing. These relationships are often strengthened by large-scale projects including railways, ports and energy facilities – all pillars of China's Belt and Road Initiative. In contrast, Lesotho, Eswatini, Burundi, and Sudan are classified as critical in terms of their dependence on the United States, mainly due to their heavy reliance on the trade benefits offered by the African Growth and Opportunity Act (AGOA) and U.S. aid programs such as USAID. For these countries, access to the U.S. market and development assistance are extremely important. Ethiopia stands out as the only African country heavily dependent on both China and the United States, while several other key players – including Nigeria, Ghana, and Kenya – having moderate relations with both China and the United States, giving them great strategic flexibility. Their ability to cooperate with both powers without falling into total dependence. Tunisia, Morocco, and Mauritius distinguish themselves as the most resilient African economies, demonstrating limited vulnerability to the competing influence of major powers. By pursuing diversified economic partnerships and balanced diplomatic strategies, they have effectively reduced their exposure to external pressures. In doing so, they seek to avoid entanglement in great-power rivalries; echoing the wisdom of the proverb: 'When elephants fight, it is the grass that suffers.' Category Description Example country Heavily dependent on China Strong alignment with China, low US debt Angola, Zambia, Djibouti, Ethiopia Heavily dependent on the United States AGOA-based economies, moderate diplomatic alignment with the U.S. Lesotho, Madagascar, Eswatini Moderately dependent on both Engagements with the two powers Nigeria, Ghana, Kenya Low dependency to Independent Diversified partnerships, multilateral orientation Morocco, Botswana, Mauritius, Egypt, Tunisia, South Africa Empirical evidence confirms that China is more effective at converting its economic investments into diplomatic support than the United States, especially in mineral-rich and infrastructure-dependent economies. In contrast, the United States exerts influence through trade preferences, health programs, and security cooperation, but its impact is often less lasting or deep-rooted. Variable Pair Correlation coefficient Economic Dependence on China versus Diplomatic Alignment with China +0.78 Economic Dependence on the U.S. versus Diplomatic Alignment with the U.S.A +0.69 The Russia-Ukraine war has highlighted a significant gap in geopolitical alignment between African countries and the United States, as evidenced by their behavior during the vote at the United Nations General Assembly. Despite US and European diplomatic efforts, many African states have adopted positions reflecting non-alignment, often abstaining from vote or refusing to condemn Russia. Many countries -including Morocco, Nigeria, Ghana, and Kenya-have moderate relations with major powers, using this dual commitment to gain competitive advantages and avoid being caught up in rivalry. Repositioning the USA in Africa: 'two steps forward, one step back' The new orientation of the United States in Africa, embodied by the 'Bessent Doctrine' – presented in April 2025 by Treasury Secretary Scott Bessent under the Trump 2.0 administration – marks a profound strategic break. It enshrines the transition from a policy based on soft power, AGOA and development aid to a logic of transactional diplomacy, centered on American economic and geopolitical interests. This shift is expressed by the scheduled end of AGOA in 2025, without a renewal proposal, and by the gradual disengagement of USAID in several African countries. The Trump administration has unveiled plans to impose new tariffs on African exports. Products that have long enjoyed preferential access to the U.S market under the (AGOA) are now threatened by high tariffs, some of which can exceed 40% (the case of Lesotho and Madagascar). Similarly, development projects in the fields of infrastructure, agriculture and health have been halted. These mechanisms are being replaced by selective bilateral partnerships, geared towards trade, private investment and securing supply chains, via instruments such as the Development Finance Corporation (DFC) or the Partnership for Global Infrastructure and Investment (PGII) programme. Under this new framework, access to the US market, technologies or financing is now negotiated on the basis of explicit commitments in terms of geo-economic loyalty , contractual transparency and compatibility with US industrial priorities. These signals were confirmed at the U.S.-Africa Business Summit held in Luanda in June 2025, which focused on critical infrastructure and investments in value chains, as well as by President Donald Trump's mini-summit with five African heads of state, chosen for their alignment with the new U.S. vision. The new orientation is backed on the one hand by diplomatic initiatives such as the American mediation between the Democratic Republic of Congo and Rwanda, which aims above all to stabilize the Kivu region to secure access to cobalt, lithium and coltan reserves, essential for the digital and energy transition, and on the other hand by regional projects such as the Lobito corridor (linking Angola, Zambia and the DRC to the Atlantic Ocean) which aims to create an alternative logistics route to the Chinese-dominated choke points, in order to control the export of strategic minerals needed for the Industrial Revolution 4.0. The determinants of the new geoeconomics strategy of the United States To support our arguments, we conducted an analysis of the determinants of changes in U.S. tariffs applied to a sample of 70 countries, representing significant diversity in terms of levels of economic development, political regimes, and geopolitical status—ranging from major world powers to middle powers to regional powers. The main objective of this analysis is to identify the key variables influencing U.S. trade decisions. To do so, we have integrated into the analysis a wide range of factors: economic (such as GDP or trade balances), political (rivalry status, diplomatic alignment), strategic (trade partnerships, bilateral agreements) as well as the risk of retaliatory measures from the concerned partners. According to our results, several factors stand out as particularly relevant in explaining the tariffs applied by the United States. These include: Geopolitical rivalries, Proximity to China (BRI, etc.) The risk of commercial reprisals, Bilateral trade balances, And the level of diplomatic alignment with Washington. Behind the apparent complexity of the tariffs lies a precise mechanism that translates Washington's political and strategic choices into figures. The regression analysis conducted reveals that four main factors determine the extent to which a country is penalized or favored by U.S. tariffs. Rivalry status (+11 points per level) This variable measures Washington's perception of the intensity of geopolitical conflict or strategic competition with a given country. On a scale from 0 (no rivalry) to 2 (strong rivalry), each additional point corresponds to an average tariff increase of 11 percentage points. This figure reflects a simple principle: the more a country is perceived as a strategic competitor or adversary, the more protectionist measures it suffers. This underlines that tariffs are not only economic tools, but also instruments of political pressure. Membership of a New trade agreement with the United States (–9 points) The presence of a bilateral or multilateral trade agreement (binary variable 1 or 0) with the United States acts as a powerful shield against high tariffs. On average, being bound by such an agreement reduces tariffs by about 9 percentage points. This reduction reflects both Washington's desire to favor its privileged economic partners and the importance of mutual commitments in maintaining fluid and balanced trade. The weight of Chinese foreign direct investment (+5.5 points) Chinese investment flows in a country (continuous variable), especially when they are significant and strategic (infrastructure, key industries), tend to increase the level of customs duties imposed by the United States, by around +5.5 points on average. This coefficient reflects the American worry that these investments are a vector of economic and political influence, reinforcing dependence on Beijing and diluting the strategic autonomy of the countries concerned. Washington is thus indirectly sanctioning China's rise to power. Joining the Belt and Road Initiative (+6.3 points) A country's integration into the Belt and Road Initiative (BRI) (binary variable 1 or 0) , a vast infrastructure and influence project launched by China, is associated with an average increase in US tariffs of around 6.3 points. This illustrates the perception that participation in this global project is not limited to economic cooperation, but represents a strategic alignment that could weaken American influence. The analysis reveals that U.S. tariffs are no longer based primarily on economic or trade criteria. They now reflect political alliances and geopolitical rivalries, especially in the context of rising tensions between the United States and China. Countries seen as strategic rivals, or those with close ties to China, are more exposed to high tariffs. Conversely, nations with strong partnerships with the United States and privileged trade agreements are generally subject to reduced tariffs. What are the profiles of the targeted countries by the new U.S trade policy? We constructed ideal types or country profiles based on a principal component analysis in order to clarify the matrix of factors for each profile. This resulted in the following.' Countries close to Beijing The analysis reveals a clear trend: countries with close ties to China -through infrastructure, investment, or production chains – are being hit with high tariffs at the U.S. border. At the top of this hierarchy is Russia (58.3%), excluded from Western trade pacts and deeply integrated into the BRICS blocs and China's Belt and Road Initiative. Brazil (50%) as well as South Africa (42,5%), members of BRICS is suffering similar treatment, due to significant Chinese investments and a growing distance from Washington's priorities. Vietnam (as well as other ASEAN Countries) are now seen in a more strategic light: as part of China's manufacturing supply chains (factory countries), essential links in Beijing's economic expansion worldwide. For Washington, they are no longer mere competitors, but pawns in a global confrontation. Countries in the grey zone Other countries are halfway there are neither enemies nor fully allied allies. Mexico (30%) is bound by the USMCA agreement, but has a persistent trade surplus. NATO member Turkey (42%) has moved away from US foreign policy lines. As for India, huge and ambitious, it walks a tightrope between non-alignment and strategic ambiguity, engaging in Chinese infrastructure projects while seeking to seduce the West. Its estimated price: 38%. These countries have in common a Strategic uncertainty, which justifies distrust and higher tariffs in Washington. Proximity is not always a rampart against retaliation Even traditional allies are not immune. Mexico and especially Canada, long considered an untouchable partner, is now subject to a 30% customs duty. Despite its trade agreement, shared border and strong defense ties, it does not escape scrutiny. Its large trade volume and occasional divergences now place it in the category of controlled risks. Conversely, South Korea (22%) and Japan enjoys lower tariffs (25%) unless a trade agreement is finalized; thanks to clear alignment and active military cooperation. What lessons can be learned to navigate the geo-economic competition between the great powers ? In today's international environment, characterized by escalating trade rivalries and the strategic use of customs tariffs for political leverage, managing tariff risks has become a crucial element of geostrategic positioning. Under the Trump administration, the United States has increasingly employed tariffs as tools of pressure or incentives, contingent on the alignment of its partners. Consequently, it is essential to proactively address and navigate both the explicit and implicit demands and conditions set forth by the U.S., as outlined below: Negotiating a trade agreement with Washington is no longer just a matter of economic interest: it is now a strong diplomatic act, which places a country within the United States' strategic perimeter of trust. Such an agreement paves the way for stable trade and targeted tariff exemptions. Reducing dependence on Chinese capital and infrastructure is also becoming an imperative. In Washington's eyes, too much exposure to Beijing's economic influence poses a risk of a geopolitical tipping point. The diversification of partnerships, particularly with Europe, Asia and the Gulf countries, reassures American decision-makers about the neutrality or strategic loyalty of the concerned country. Finally, restoring equilibrium in the bilateral trade balance with the United States is crucial. Persistent surpluses, especially in sensitive sectors such as steel, textiles or semiconductors, are perceived as unfair and may justify protectionist measures. To avoid them, it is often necessary to compensate for these imbalances by purchasing American products, reciprocal investments or participating in joint industrial projects. – The strategic rivalry between the United States and China is influencing investments globally. Most countries are walking a tightrope, seeking to align themselves simultaneously with these two powers while preserving a position of neutrality. This neutrality is particularly crucial for african countries, which depend on both China and the United States for investment and development assistance. In this context marked by strong geopolitical tensions, Morocco has asserted itself as a key player in economic connectivity, becoming a real connector country between rival powers with a strategic competitive advantage mastering critical components and resources embedded in global supply chains, particularly in critical sectors of the new industrial revolution such as electric vehicles, green energy, artificial intelligence and cloud computing. Under the visionary leadership of HM King Mohammed VI, and driven by a pragmatic foreign policy of multi-alignment, Morocco has succeeded in maintaining balanced relations with the major powers, thus affirming its role as an influential intermediary on the international scene. Tags: africa economyUS and Africa
Globe and Mail
13-06-2025
- Business
- Globe and Mail
In this brave new world, the economy is highly political
Christopher Collins is a visiting fellow at the Cascade Institute at Royal Roads University. Jens Hillebrand Pohl is the director of the Helsinki Geoeconomics School. Thirty-five years ago, an American author named Edward Luttwak wrote a landmark essay popularizing the term 'geoeconomics.' Mr. Luttwak, an influential political scientist who has been called 'the Machiavelli of Maryland,' argued that as the Cold War ended, traditional military power would be joined by economics as a way for countries to exert power. We were entering an age where, as Mr. Luttwak wrote, the world order would be shaped by 'the logic of war in the grammar of commerce.' This fusion of economics and geopolitics remained an obscure area of study for years following Mr. Luttwak's essay. Indeed, in the 1990s, the world went in the opposite direction; free trade, open markets and global investment soared in an era of hyperglobalization. Economics appeared increasingly disconnected from geopolitics, and economic activity was focused on maximizing value, rather than on projecting power. Some went so far as to argue the world had reached 'the end of history,' following the 'unabashed victory of economic and political liberalism.' However, recent developments, such as the Russian invasion of Ukraine and escalating U.S.-China tensions, show that the world may be, as the late U.S. secretary of state Henry Kissinger said, 'in the foothills of a new Cold War.' As the IMF warns, increasing trade restrictions, technological decoupling, disrupted capital flows and migration restrictions are fragmenting the global economy, splitting the world into competing 'blocs.' However much we may have wanted to be done with geopolitics, it is not done with us. In this era, economic policies are increasingly driven by political and power dynamics, and geopolitical questions are informed by economic concerns. All the components of the global economy – currencies, supply chains, technology, trade and capital flows, and information networks – have become tools of power and influence. More and more, these instruments serve as expressions of national sovereignty, whether through export licensing, cross-border data regimes, or control over investment standards. And across the world, economic policy is no longer reactive or technocratic: It is being politicized and weaponized. As a resource-rich, trade-dependent middle power, Canada must navigate this increasingly fragmenting world while protecting its core economic interests. To do so, Canada will first need to develop a sophisticated capability to engage in what experts call 'economic statecraft.' This will include developing economic tools to manage both bilateral and multilateral relations with the U.S., China and Europe. Fortunately, as history has shown, this is something at which Canadians are skilled. As Robert Bothwell, one of the leading historians of Canadian foreign policy, once said, when it comes to trade talks, Canadians 'are notoriously tough.' Canada's private sector will also need to adapt to this new reality. Geoeconomic shifts have reshaped how companies do business around the world, leading to what some have called 'a new geography of manufacturing.' In this environment, firms are not just adapting to geopolitics, they are becoming its agents. Global businesses and investors must now align their operational models with geostrategic risks, navigate extraterritorial legal exposure, and anticipate shifts in access to data, talent and capital. Managing all of this will require new ways of thinking, something the CEO of one large global Canadian financial services firm likened to 'swapping out your cross-country skis for downhill skis midslope.' Canadian investors will also be affected. As economist David Skilling has said, 'trade wars are a precursor to capital wars.' In a sign of the times, Larry Fink – the CEO of BlackRock, the world's largest asset manager – has argued that global capital markets are becoming more attuned to national goals in what he calls 'the second draft of globalization.' Canadians invested approximately $2.5-trillion abroad in 2024, and Canadian investors may increasingly find themselves caught between competing political pressures in a fragmenting global investment landscape. Arguably, the most immediate challenge for Canada lies in managing its relationship with the U.S. while preserving economic diversification. Unlike some other middle powers, which can hedge between competing blocs, Canada's geographic position and economic integration with the U.S. make strategic ambiguity nearly impossible. For Canadian investors, a provision in Donald Trump's Big Beautiful Bill Act to increase tax rates on some foreign investors is particularly concerning. It signals a broader shift: the weaponization of access to U.S. capital markets as an instrument of statecraft. As Mr. Luttwak predicted, economics is increasingly becoming a venue for geopolitical competition, especially among the great powers. Meeting this challenge will be tough. But, as we have seen before, Canadians are tough, too.
