President-elect Donald Trump is expected to rein in multi-million dollar development aid streams to Africa, a new report has suggested.
The US is Africa's largest bilateral aid donor with an estimated $9bn (£7.2bn), followed by the UK ($4bn or £3.2bn) and France ($2bn, £1.6bn), according to 2015 figures from the Organisation for Economic Co-operation and Development (OECD). Just over a month after his shock election, Trump has offered little insight on whether his foreign policy will include the African continent, or how the US will pursue policies relative to aid.
Earlier this week, Trump nominated career oil man and CEO of the oil giant ExxonMobil, Rex Tillerson, as the nation's chief diplomat. At the time of this nomination, Trump's transition team said Tillerson will "help reverse years of misguided foreign policies and actions that have weakened America's security and standing in the world."
Under the Trump presidency, the US is likely to streamline its multibillion-shilling annual aid to countries such as the Democratic Republic of Congo (DRC), Kenya or Tanzania, a report by commissioned by the Institute of Chartered Accountants in England and Wales (ICAEW), has claimed.
In its Economic Insight: Africa Q4 2016 report, the accountancy and finance body suggested that there were signs that Trump's administration would adopt an expansionary fiscal policy. It is also likely to cut spending to comply with increased budget for infrastructure development.
"Aid is one of the main channels through which a change in US policy under the new president could impact Africa," ICAEW regional director for Middle East, Africa and South Asia Michael Armstrong said in the statement. "Policymakers and businesses across the continent will be keen to see President-elect Trump's plans for development policies once he takes office (from January 20)."
According to the ICAEW, reining in development aid will "affect dependent countries" such as Ethiopia, Kenya, Tanzania, Nigeria and DRC. In East Africa, for instance, US official development aid receipts reached $3.5bn in Ethiopia, $2.5bn in Kenya and $1.5bn in both Tanzania and Uganda, according to OECD.
While trade volumes between the US and Africa have been negatively impacted by the shale boom in the US, the accountancy and finance body suggested Trump's administration could further affect trade relations with Africa through the 2000 Africa Growth and Opportunity Act (AGOA) framework.
"Trade is another channel likely to be affected by the new US administration," Armstrong said. "Considering the president-elect's protectionist stance, African economies could be harmed by tighter policies towards agricultural and manufacturing trade."