A study commissioned by the US Congress found that the African Growth and Opportunity Act (AGOA) is a trade failure.
This emerged during a digital press briefing held last week ahead of the upcoming AGOA Forum which will be held in Johannesburg, South Africa from 2nd to 4th November. The latest revelations come at a time when Botswana continues to refine its AGOA strategy, informed by stakeholder feedback.
AGOA is a US legislation enacted in 2000 to promote trade and economic cooperation between the UA and some sub-Saharan African countries. Speaking during the digital press briefing, the Assistant U.S. Trade Representative for Africa Constance Hamilton said the lessons learned from 25 years of AGOA, “is that we have to do better.”
Citing a study by the U.S. International Trade Commission which looked at the implementation of AGOA, Hamilton said one conclusion that the authors of the study “made is that AGOA has not met the expectations we had in 2000.” Hamilton also said “…so while they (authors of the study) are not saying that the program hasn’t been useful, because some countries have benefitted greatly from AGOA, but the majority have not.”
Hamilton added that “…so we know that we still have a lot of work to do…And that’s one reason why, when we look at renewal this time – and I know that, especially like from the African diplomatic corps and others who are concerned about if Congress starts tweaking the language, it would take too long and the program might actually expire.”
She said; “But we do believe that not addressing and not trying to change the program and make it better is a wasted opportunity.” Hamilton said as U.S Trade Representatives (USTR) for Africa they support renewal of AGOA, but “we do think that there are things that can be done to make the program more impactful, and we hope that Congress will take a look at those things.”
“One of the most important things about using the program – because we have noticed that for those countries that have actually been very proactively reaching out to their private sector, to their entrepreneurs, to their farmers and making sure that they understand how the program works is one of the keys to whether or not their businesspeople and their entrepreneurs are going to be able to use the program,” she said
She said when AGOA was enacted in 2000, “we hoped that it would be really a game changer for the continent in terms of our relationship with individual countries and with the ability to support regional integration across the continent.” Hamilton said the US was alive to the fact “that a number of countries get into AGOA, a number of countries get out of AGOA.”
“These are all questions that we have to talk about – about what’s important, what we are looking for, how can the program be more impactful. After almost 25 years, we know that very few countries are actually taking advantage of this program and that the sectors that are open and available, very few of those are actually being utilized,” she said.
For her part, Deputy Assistant Secretary in the Bureau of African Affairs of the State Department Joy Basu who was also speaking during the digital press briefing said there are so many sectors that are available for export through AGOA, and traditionally in some countries it is more of extractives like oil that has been well utilized.
“We would really encourage the government and civil society to work together to create more plans for how AGOA can be better utilized in Luanda,” she said. She indicated that there is tremendous potential across – even, “for example, just agricultural products that I know are grown in Angola.” But one of the key factors to raising utilization, Basu said, is having a strategic plan for how a government will work with the private sector to utilize that.
“So we’re really eager to see more – that trade diversified. For the government and civil society to work together to create a utilization plan, we’re working through the State Department, USAID, USTR and with our Prosper Africa initiative to create more trade hubs and workshops to help educate different small businesses on how to actually utilize AGOA better,” she said.