Egyptian textile exporters face heightened competition in their primary market after US President Donald Trump placed Egypt among the handful of countries in the highest tariff tier, imposing a 12.5% duty on its exports, even as Egyptian shipments to the United States continue to expand.
Trump announced the additional levies ranging from 10–12.5% on imports from 60 countries, stating the affected nations failed to take sufficient measures to curb products made with forced labor.
The move extends a trade policy launched last year under the administration’s “trade war” initiative to reduce the US trade deficit.
Despite concerns surrounding Egypt’s inclusion in the highest tariff bracket, US trade data indicates that Egyptian exports have maintained an upward trajectory since the trade war began.
According to the US Census Bureau, Egyptian shipments to the US rose to $1.3 billion between January and May, up from $1.1 billion during the same period last year.
Data from the US Department of Commerce also showed that Egyptian garment and textile exports to the US market increased by approximately 22.5% over the same period, reaching around $670 million.
“The problem does not lie solely in the 12.5% tariff rate itself, but in the fact that the decision did not apply to all competing countries,” Mohamed Kassem, chairman of the Egyptian Exporters Association (ExpoLink), told Al Manassa.
Kassem explained that while Egypt and a select group of nations were subjected to the new duties, several other African nations retain duty-free access to the US market under the African Growth and Opportunity Act (AGOA).
This disparity provides competitors such as Kenya a pricing advantage equivalent to the 12.5% tariff imposed on Egyptian goods, potentially undermining the competitive standing of Egyptian products in the US market, Kassem added.
Magdy Tolba, a member of the Readymade Garments Export Council, told Al Manassa that the impact on the sector will be tangible because “nearly half of Egyptian readymade garment exports go to the US market, which represents the sector’s largest global destination alongside Europe.”
According to data from the Central Agency for Public Mobilization and Statistics (CAPMAS), readymade garment exports account for roughly 48.7% of total Egyptian exports to the United States.
Egypt also benefited from the trade war
Mohamed Abdel Salam, chairman of the Chamber of Readymade Garments Industry at the Federation of Egyptian Industries, attributed the growth of Egyptian exports during the trade war partly to disruptions experienced by other US trading partners.
Abdel Salam told Al Manassa that Egyptian companies continue to leverage advantages under the Qualified Industrial Zones (QIZ) agreement. He noted that certain competing countries face significantly higher US duties—up to 22% on polyester apparel and 35% on cotton goods—giving Egyptian items a comparative advantage in specific product categories.
Egypt signed the QIZ protocol with the United States and Israel in December 2004. The agreement permits Egyptian products to enter the US market free of duties and quantitative quotas, provided the goods contain a minimum Israeli component of 11.7%.
The latest tariffs mark a continuation of the Trump administration’s efforts to impose sweeping tariffs on trading partners since April 2025. The administration initially relied on the International Emergency Economic Powers Act (IEEPA) until a US court declared the action illegal last February, prompting officials to invoke the Trade Act to enact temporary 150-day tariffs.
Following the expiration of that temporary measure, the administration reinstated the duties under the Trade Act, citing forced-labor prevention in exporting countries as the primary justification.
No alternative to product development
Exporters say that navigating the new tariff landscape requires strengthening the market competitiveness of Egyptian products both within the US and in other international markets.
Tolba stated that the ability of Egyptian manufacturers to mitigate tariff pressures “depends on shifting toward higher value-added manufacturing rather than focusing on low-cost commodity products.”
He added that exporters remain optimistic that the tariffs will not persist over the long term, noting that the policy is already encountering legal challenges within the United States.
On Friday, two US companies filed a lawsuit in the US Court of International Trade in New York challenging the latest tariff package. The suit alleges that the administration exceeded its statutory authority and argues that imposing tariffs requires independent, country-specific investigations demonstrating unfair trade practices.
