Nigeria: AGOA a vital boost for Aba leather, garment cluster
In a bid to enhance the industrial value of manufacturers in Abia State, Fidelity Bank, in collaboration with the Nigerian Export Promotion Council (NEPC) and Ghana-based West African Trade and Investment (WATI) hub recently held a capacity building workshop on the African Growth and Opportunity Act (AGOA) to sensitise the Aba leather and garment cluster on essential services targeted to build their businesses. Amby Uneze reports.
As part of her key functions to provide her customers and the business community across the country the needed capacity to be able to remain in business and function as catalyst of promoting export trade in line with the African Growth and Opportunity Act (AGOA), Fidelity Bank Plc recently organised a workshop to sensitise the Aba leather and garment cluster on essential services targeted to build their businesses.
The two-day workshop with a theme ‘The Advantage of Export Opportunities to the United States under AGOA’ was held in Aba, Abia State with Fidelity Bank as catalyst in collaboration with Nigerian Export Promotion Council (NEPC) and Ghana-based West African Trade and Investment (WATI) hub, and it featured a mini-exhibition by the manufacturers of the leather and garment manufacturers.
The African Growth and Opportunity Act (AGOA) is a United States Trade Act, enacted on 18 May 2000 as Public Law 106 of the 200th Congress. AGOA has since been renewed to 2025. The legislation significantly enhances market access to the US for qualifying Sub-Saharan African (SSA) countries. Qualification for AGOA preferences is based on a set of conditions contained in the AGOA legislation. In order to qualify and remain eligible for AGOA, each country must be working to improve its rule of law, human rights, and respect for core labour standards.
The Act originally covered the 8-year period from October 2000 to September 2008, but legislative amendments signed into law by US President George Bush in July 2004 served to extend AGOA to 2015. At the same time, a special dispensation relating to apparel was extended by three years to 2007; but in December 2006 these were extended to 2012.
In 2007, the apparel “abundant supply” provisions were enacted, although these were repealed again in 2009. A subsequent legislative revision in September 2012 extended the apparel provisions to the end of 2015 to coincide with the current expiry of the AGOA legislation.
AGOA builds on existing US trade programmes by expanding the (duty-free) benefits previously available only under the country’s Generalised System of Preferences (GSP) programme. Duty-free access to the US market under the combined AGOA/GSP programme stands at approximately 6,500 product tariff lines, including the tariff lines that were added by the AGOA legislation. Notably, these newly added “AGOA products” include items such as apparel and footwear, wine, certain motor vehicle components, a variety of agricultural products, chemicals, steel and many others.
After completing its initial 15 year period of validity, the AGOA legislation was extended on 29 June 2015 by a further 10 years, to 2025.
In his presentation, the General Manager of Fidelity Bank in charge of Small and Medium Enterprises (SMEs) and Export, Mr. Ken Opara told the participants that the aim of the workshop was to help them to get Nigerian market and Nigerian exposure as well as introducing them to international market.
“We are seeking to achieve (because these people are into manufacturing, the real sector that produces very good quality products) and to showcase them to the international market. This idea is that they will key into the incentive scheme of AGOA – an incentive scheme that the American government put in place to support export of African products into American market.
“AGOA seeks to guarantee them duty-free so that those products will be comprehensive and cheaper and they will get there. But our people here have not taken advantage of that, so we are creating awareness on what they should do to be compliant and take advantage of this AGOA scheme”, he said.
According to Opara, “we want to ensure that they (Aba manufacturers) generate the needed foreign exchange, as export is critical for the country because it helps to drive foreign exchange. Aba being one of the commercial nerve centres is targeted as a key for the diversification from oil to real sector. What is at the heart of what we provide is that we help them build capacity, to discover market opportunities; we also render advisory services and part of it is what we are doing.
“We use this platform to provide all that they need to know to secure loans to be able to drive business in order to participate in participate in the AGOA scheme. The first is to give them access to capacity, guidance, and access to funding. We look into their business to know what type of funding will help them. We advise them to start exporting in small way by starting with pre-shipment finance, and we can also provide them with finance to enable them get the right equipment”, he said.
Opara however, commended the turnout of the business men and women who inspite of their busy schedule attended the workshop, in a sign of acceptance of the capacity building.
The WATI representative, a USAID project, Mr. Emmanuel Udonko, an Apparel Specialist said his organisation provides technical assistance, capacity building and marketing linkage to West African sub-region business concerns to make sure that companies are able to export successfully their products to America through AGOA scheme.
He said his mission to Aba which he described as a hub in the region especially in leather and apparels was to sensitise them on readiness to export their products to America through AGOA platform and to enable them access the US market.
According to him, “this workshop is a good platform to the companies to begin to appreciate what it takes to get to that level of export readiness to access the opportunities in the US market. So far it has provided valuable opportunities to the participants to learn a lot about keying into the AGOA platform.
For Mr. Mohammed Abdulyana, a Senior AGOA Specialist of USAID/WATI based in Ghana, the advantages and benefits of AGOA for Nigerian manufacturers are enormous and “we are here to educate the Aba manufacturers on how to be part of AGOA scheme”. He said the duty free American market is an opportunity for Aba manufacturers to key in.
Another speaker, Chief Funso Abiri, an AGOA expert and consultant with the NEPC was thrilled at the interest shown by the Aba leather and apparels manufacturers, on being part of AGOA scheme. He thanked Fidelity Bank for being handy in providing advice and financial assistance to the manufacturers to be able to be part of the AGOA mandate.
One of the participants, Mr. Ken Anyanwu, who is also the National Secretary of Association Leather and Allied Industrialist of Nigerian (ALAIN), an umbrella body for the finished goods leather manufacturers in Nigeria, commended the organisers of the workshop and expressed his members’ satisfaction to be part of the AGOA scheme.
- See the leather export data on AGOA.info at this link.