A new report by the UN Economic and Social Commission for Western Asia (ESCWA) warns that Arab countries could lose up to $22 billion in non-oil exports due to sweeping US tariff hikes imposed on April 2.
The new tariffs include a blanket 10% duty on nearly all imports, rising up to 42% for countries with trade surpluses. While oil remains exempt, the measures now impact key exports like textiles, aluminum, fertilizers, and electronics—nullifying previous trade preferences for Bahrain, Jordan, Morocco, and Oman.
ESCWA identifies six countries most at risk: Bahrain, Egypt, Jordan, Lebanon, Morocco, and Tunisia—with Jordan the most exposed due to its reliance on US markets. The report also notes that potential trade diversion benefits for Arab nations have faded following a US policy shift on April 9.
Countries in the Agadir Agreement (Egypt, Jordan, Morocco, Tunisia) may see GDP drop by 0.41%, exports by 1.41%, and investment by 0.38% in 2025. The GCC is expected to fare better, with a smaller GDP loss of 0.10%, but faces higher risk from oil price volatility.
Bond yields have risen, increasing borrowing costs, with Egypt, Morocco, Jordan, and Tunisia facing tens of millions in additional interest payments.
ESCWA urges coordinated regional responses, trade diversification, and stronger fiscal planning to cushion the impact of ongoing global trade disruptions.