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U.S./Africa: African Union advocates for a "no-change" renewal of the AGOA program

Saturday, 04 November 2023 03:57
U.S./Africa: African Union advocates for a "no-change" renewal of the AGOA program

(Ecofin Agency) - Several American officials, including the U.S. Deputy Trade Representative for African Affairs, have announced in recent months that the Biden administration aims to review the AGOA or replace it with a new trade agreement.

The African Union (AU) called on Thursday, November 2, for the U.S. Congress to renew the African Growth and Opportunity Act (AGOA), a trade preference program granted by the United States to Sub-Saharan African countries since 2000, for at least an additional ten years without making any changes.

"[An extension of] 10-20 years is very critical to the investment community. Anything lower than that would generate uncertainty,” said Albert Muchanga, AU Commissioner for Economic Development, Trade, Industry, and Mines during the 20th AGOA Forum held in Johannesburg. Muchanga also indicated that "if there are any enhancements to be made, those should be done after the extension”.

Launched in May 2000, the AGOA program enables eligible Sub-Saharan African countries to export over 1,700 products to the United States without paying duties. These products add to about 5,000 other items that can access the American market duty-free under the generalized system of preferences.

Each year, Washington updates the list of AGOA-eligible countries, considering their commitment to market economies, respect for the rule of law, and poverty alleviation policies. The initiative also takes into account the democratic progress or setbacks of the countries involved.

With the AGOA program set to expire in September 2025, several African nations are advocating for an early ten-year extension without changes to reassure businesses and new investors. Renewing the trade preference system is also supported by some members of the U.S. Congress, who fear that revising the program might delay or jeopardize its renewal.

In late September, U.S. Senator John Neely Kennedy introduced a bill in the upper house of Congress proposing the extension of AGOA until 2045. He mentioned that the program will greatly help Americans counter the increasing influence of China in Sub-Saharan Africa.

However, several U.S. officials, including Deputy U.S. Trade Representative for African Affairs Constance Hamilton, have advocated in recent months for the revision or replacement of AGOA with a new trade agreement.

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ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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