TRALAC - Trade Law Centre

US firms seek Uganda partners to tap into AGOA

Monday, 05 June 2017

Source: The Observer (Kampala)

In a bid to exploit the market in the world's largest economy through the African Growth and Opportunity Act (AGOA) extension, firms from the United States will now partner with those from Uganda, especially in the agri-business sector.

The business partnerships are expected to step up Uganda's production and capacity of the agricultural sector and the levels of trade and investment between the two countries.

This was one of the outcomes during the just-concluded meeting between the US agricultural trade mission and the Private Sector Foundation Uganda (PSFU) stakeholders in Kampala.

Addressing the participants, the US ambassador to Uganda, Deborah Malac, said tapping into the enormous potential of Uganda's agricultural sector and linking it to the vast American market is a winning combination both countries can profit from.

"One of my primary goals as the American ambassador to Uganda is to see that bilateral trade and investment flourishes between the United States and Uganda. When you think about the potential of this partnership, you begin to get a sense of the unlimited possibilities that are before us. I am confident that we are on the right track," she said.

Malac said Ugandan and US businesses have laid the groundwork for huge investments in new deals over the next couple of years, which will help bring improved inputs, agricultural equipment and services into Uganda's agricultural sector.

Susan Muhwezi, the senior presidential advisor on AGOA and Trade, said Uganda has been promoting AGOA since its inception 15 years ago, with various challenges, which include supply side constraints, lack of direct linkages with the US markets and lack of partnerships with US companies.

"The easiest way to penetrate the AGOA market is to have an American partner. That is because the Americans know their market and the challenges best," Muhwezi said.

"The more partnerships we build, the easier it will be to access the American markets. But there should also be follow-ups by the private sector. If you say you are exporting 10 tonnes of coffee, for example, then fulfill it. Business partnership is not about promising something and not fulfilling it," she added

Some participants also felt that government was not doing enough to exploit the opportunities that AGOA presented. A number of officials from the US delegation to Uganda say they are ready to work with their Uganda counterparts.

In his presentation, the counsel for International Trade in the state of Nebraska, Angel Velitchkov, said the Nebraska department of agriculture is ready to do a training and exchange program for Uganda students studying agriculture.

Uganda was declared AGOA eligible in 2000. However, statistics show that Uganda's exports to AGOA are still low. Signed into law on May 18, 2000, the African Growth and Opportunity Act allows African countries to export anything-but-arms into the US market on quota and duty-free basis. Items accepted include flowers, fish, and processed agricultural products.

After completing its initial 15-year period of validity, the AGOA legislation, which was expected to end in 2015, was extended by a further 10 years to 2025.

Hosted along with the American Chamber of Commerce (AmCham) in Uganda and the Private Sector Foundation Uganda, the three-day event brought together 21 American agribusinesses and 24 Ugandan firms to discuss ways of forging deeper partnerships.


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