A senior U.S. official has stated that the United States needs to change its flagship African Growth and Opportunity Act (AGOA) to become more impactful during a reauthorization process in Congress.
The Assistant U.S. Trade Representative for African Affairs, Constance Hamilton conveyed this statement during a press briefing held in anticipation of a meeting between U.S. officials and African trade ministers scheduled to take place in South Africa next week.
She said,
- “We need to do better, Some countries have benefited greatly from AGOA, but most have not. Not trying to change the programme and make it better is a wasted opportunity.”
She noted that the reauthorization process would devise measures to “make the programme more impactful”
About the AGOA policy
Initiated in the year 2000, the African Growth and Opportunity Act (AGOA) provides duty-free access to the U.S. market for exports from eligible nations.
While originally set to expire in September 2025, ongoing deliberations are focusing on whether to extend it and the duration of any potential extension.
African governments and industry associations are advocating for an early, uninterrupted 10-year extension of AGOA to provide assurance to businesses and attract new investors who might be apprehensive about its future.
Some members of Congress also back this reauthorization, fearing that modifying the program could impede or jeopardize its renewal.
Last month, Republican Senator John Kennedy proposed a 20-year extension without alterations, emphasizing its pivotal role in countering “China’s expanding influence in the region.”
Mixed results from AGOA policy
A research report, commissioned by U.S. lawmakers and released earlier this year, revealed that AGOA had effectively contributed to poverty reduction and employment generation in specific nations, particularly among women.
Nonetheless, a significant portion, over three-quarters, of duty-free non-petroleum exports to the U.S. through the program from 2014 to 2021 originated from just five countries: South Africa, Kenya, Lesotho, Madagascar, and Ethiopia.
Two-way trade between the United States and Nigeria under the AGOA policy was worth $8.1 billion in 2022.
Nigeria’s exports to the U.S. mainly include crude oil, cashew nuts, cocoa and animal feeds while the U.S. sells cars, machinery etc to Nigeria.
Although figures for crude oil exports to the U.S. have dwindled from about 1.1 million bpd in 2005 to just over 105 thousand bpd in 2022.
