Hopes are high that the US will renew the African Growth and Opportunity Act (AGOA) before its expiry on September 30, 2015. But there have also been calls from US policy makers to investigate the effectiveness of the trade program, which provides duty-free access to the United States for products from sub-Saharan Africa.
Total US imports from AGOA beneficiary countries grew at an average annual rate of 6.7 per cent during the 13-year period from 2000 to 2013. Growth was most pronounced in the first eight years, when the value of these imports increased almost fivefold in 2008. Since then, however, US imports from AGOA countries have fluctuated sharply.
The increase in imports was primarily from three categories -- apparels, cars, and refined petroleum products. Apparels was one of the categories having experienced particularly strong export growth in the whole 13-year period.
Three major recommendations have been made: improving supply capacity, including seeking out foreign direct investment and capacity-building assistance; making AGOA permanent and binding; and improving the business climate of beneficiary countries. This could include improved rule of law and protection of intellectual property rights.
One suggestion is expanding the list of eligible products, ending country eligibility requirements to aid beneficiary countries in formulating long-term export strategies, and increasing trade assistance to improve both institutional and trade capacity.
trade.gov/agoa/
