Altman Solon is the largest global TMT consulting firm with expertise in telecommunications consulting. Partner Björn Menden explains the indirect effects of U.S. tariffs on African telcos.
As global economic tensions rise—driven by a fresh wave of U.S. tariffs, retaliatory measures from China, and others, and a partial escalation of the trade dispute—uncertainty is becoming the defining characteristic of the global market. While most tariff increases have been paused for 90 days, a 10% base tariff remains in effect on nearly all imports, and tariffs on Chinese goods have been raised to 125%, contributing to what is now widely viewed as a fragmented and volatile policy landscape. The downstream effects are already being felt. One of the less obvious but critically impacted sectors is telecommunications in Africa. While tariffs may seem abstract to operators in Nairobi, Lagos, or Johannesburg, the resulting shifts in energy prices, currency volatility, and equipment costs are creating immediate challenges—and unexpected opportunities—for African telcos.
The reintroduction of U.S. tariffs on key electronics exporters—including China, South Korea, and Taiwan— is causing ripples across global markets. Oil prices have seen significant swings, with Brent crude falling by as much as 7% in early 2025 due to fears of an oversupplied market and slowing global demand. While energy commodities themselves may be exempt from tariffs, their prices are not immune to the broader economic disruption these policies create. The International Monetary Fund and other observers have flagged a heightened risk to the global economy. In turn, investor hesitancy and currency depreciation are increasing the cost of doing business in emerging markets, including most of Africa.
Africa's energy landscape is as diverse as the continent itself. Oil-exporting nations like Nigeria face declining revenues from falling crude prices, while importers such as Ghana and Kenya benefit—at least superficially—from lower global rates. However, this benefit is often offset by weakening currencies, making imported fuel and equipment more expensive in local terms. In regions such as East Africa, where renewable energy projects are expanding, the impact of tariffs on solar panels and grid equipment—mostly sourced from China—is already being felt. Infrastructure expansion plans are slowing, project costs are climbing, and many telcos are being forced to fall back on diesel-based power solutions.
This might seem puzzling at first—after all, tariffs imposed by the U.S. on Chinese goods don't legally apply to imports into Africa. However, the globalized nature of supply chains means that when demand for Chinese equipment decreases in the U.S., Chinese manufacturers often reprice or reallocate inventory, sometimes shifting higher-spec models or pricing tiers toward markets like Africa. In addition, if Chinese producers face cost pressures from reduced export volumes or higher input costs, they may pass these costs on globally. African telcos, many of which rely on Chinese suppliers for solar, battery, and network components, often see these effects in the form of increased lead times, constrained supply, or moderate price inflation, despite not being directly subject to the tariffs themselves. In Southern Africa, where grid instability is a chronic issue, telecom operators are heavily reliant on diesel generators. Any rise in fuel costs or difficulty importing alternative energy systems puts immediate pressure on operating expenses.
Telecommunications companies in Africa are uniquely vulnerable to energy price swings and equipment cost inflation. With over 70% of network sites in some countries operating off-grid or with limited grid reliability, energy costs make up a significant portion of telcos' operational expenditure (OpEx). When tariffs increase the price of key imports—like lithium batteries, inverters, and solar panels—telecom operators must either delay infrastructure rollouts or absorb the higher costs. And in a continent where the majority of users are prepaid customers, passing those costs to consumers is rarely a viable strategy. Moreover, global uncertainty tends to weaken African currencies, making all imports—from network switching gear to backup power systems—more expensive. The result is a squeeze on margins, delayed rollouts, and in some cases, reconsidered market expansion strategies.
To navigate this evolving landscape, African telcos are adopting several strategic responses:
While no African countries are currently targeted by the full force of tariffs beyond the 10% base tax, the broader climate of policy unpredictability is reshaping how global supply chains behave—and how risk is distributed. For African telcos, the current situation represents not just a temporary disruption but a more enduring strategic challenge. Those who adapt by localizing supply chains, optimizing energy usage, and rethinking infrastructure partnerships will be better positioned—not just to survive, but to lead—in Africa's next digital growth wave.