Sector Data: Apparel Trade

AGOA provides duty-free access to the US market for garments manufactured in qualifying African countries, subject to conditions. While garments are not included under the US GSP, they qualify for AGOA preferences provided that (a) countries have met the 'wearing apparel provisions' by having implemented a special apparel visa system, and subject to the specific Rules of Origin (RoO) requirements being met in the manufacture of qualifying items.

Apparel preferences are included in special provisions within Chapter 98.19 of the US tariff nomenclature.

Details on the AGOA apparel manufacturing requirements are available elsewhere in the Rules of Origin section. Preferences are available in a number of different categories. For countries classified as "lesser developed" by the AGOA legislation, provided that an apparel visa system has been implemented and certifies by US authorities, full flexibility with respect to the sourcing of input materials (textile fabrics) is available while for other countries, fabric must be sourced locally or from another AGOA beneficiary in order to meet AGOA's RoO requirements. 

The trade data reveals that apparel exports under AGOA peaked in 2004, having risen sharply since AGOA's inception late in 2000 (the first apparel visa certifications were only issued early in 2001 though). This upward trajectory coincided with two important dynamics: the relative advantage that African producers had over exporters in Asian countries, many of who were subject to apparel quotas under WTO regulations (these expired at the end of 2004, although other quotas were implemented on a temporary basis thereafter), while some of the leading exporters under AGOA experienced competitive advantages brought about through local currency movements, making local products particularly competitive. 

The global financial crisis in 2009/10 placed pressure on US imports, including those sourced from African producers. Exports have since stabilised. As shown in the chart, apparel exports under AGOA preference today account for virtually all US-bound apparel exports from AGOA beneficiaries within this sector. Leading exporters utilising these trade preferences include Lesotho, Kenya and Mauritius.