Geopolitical Rivalry and Economic Vulnerability in Africa: Assessing the Impact of U.S.–Iran Tensions on Trade, Energy Markets, and Macroeconomic Stability

Abstract

This study analyzes the impact of geopolitical tensions between the U.S. and Iran on Africa’s political economy and security architecture, focusing specifically on transmission mechanisms, security implications, and response strategies. Employing a comprehensive approach that combines quantitative analysis of macroeconomic indicators with a qualitative assessment of security dynamics and policy measures, the study identifies oil price volatility as the primary channel through which these geopolitical tensions affect African economies. The findings indicate that oil-exporting nations face revenue instability, while oil-importing countries experience rising inflation and fiscal pressure. Trade disruptions and financial market volatility exacerbate these effects, constraining economic resilience. In the security realm, the study identifies signs of increasing militarization in strategically important regions—such as the Red Sea basin—and the proliferation of “proxy actors,” which heighten instability in vulnerable states. Despite their development, regional security structures face significant resource and institutional constraints in addressing these complex challenges. In response, African states employ a mix of diplomatic maneuvering, economic adaptation, and security cooperation, though the effectiveness of these strategies varies according to specific contexts. The study concludes that while Africa remains structurally vulnerable to external geopolitical shocks, mechanisms for resilience and strategic adaptation are beginning to emerge. The authors recommend accelerating economic diversification, regional integration, and security cooperation to enhance the continent's capacity to withstand challenges stemming from great-power rivalry.