- African Growth and Opportunity Act
TRALAC - Trade Law Centre
You are here: Home/News/Article/'Nigeria missing as Kenya, Ghana tap AGOA opportunities to boost foreign exchange earnings'

'Nigeria missing as Kenya, Ghana tap AGOA opportunities to boost foreign exchange earnings'

'Nigeria missing as Kenya, Ghana tap AGOA opportunities to boost foreign exchange earnings'
Published date:
Monday, 05 February 2024
Damilola Odifa

Africa’s biggest economy is still failing to tap the opportunities that the African Growth and Opportunity Act (AGOA) present to boost its foreign exchange, amid acute dollar shortages.

The AGOA has been on for over twenty-three years as it was enacted in 2020. In 2015, the program was modernised and extended to 2025, implying that there are only about 15 months before the window closes.

Some countries have taken advantage of the AGOA more than others, Kenya and Ghana have been identified as countries with worthy experiences to share from their trade interactions on the AGOA platform.

“Currently, Kenya exports about $900 million worth of products to the US, and on the converse, imports about $600 million,” said Isaac Otolo, advisory Partner, Transactions PwC based in Nairobi, but covering the East African region.

He added that “20,000-25,000 direct jobs have been created to take advantage of the AGOA opening and window, with over 100,000 indirect jobs.

“Kenya’s tea, coffee, and certain gemstones also go out through the window.”

AGOA, a US initiative essentially opened the window to allow for imports from Africa into the United States through a preferential window, but with the exports first meeting certain conditions, and according to Otolo, Kenya was one of the first countries to take advantage.

“Kenya’s main exports out of the AGOA window are from the apparel space and a lot of those goods are produced and processed in Kenya.

“Majority of these goods are processed in export processing zones where primarily foreign investors have been able to access,” Otolo said.

In the Ghana context, Albert Kassim Diwura, deputy CEO of the Ghana Export Promotion Authority, has said that a core mandate for the Ghana Exports Promotion Authority, amongst other things, is to provide current and reliable trade information to its exporters, constantly updating them about the AGOA.

“Another thing we prioritise is the capacity building of our exporters. We have an export school (virtual), though our plan is to have one in brick-and-mortar.

“As part of our delivery at the export school, we make AGOA top priority, telling people the products, the opportunities, how much we’ve made going by data, etc.,” Diwura said.

Ghana also has seen remarkable growth in its apparel and clothing sector. The nation’s ability to produce trendy, affordable clothing has made it a favoured supplier for American retailers, contributing to Ghana’s increased share of AGOA exports.

Nigeria’s non-oil AGOA exports have remained stagnant, primarily comprising a few agricultural products and handicrafts.

Though, “Nigeria was the top supplier of energy products in 2022 ($3.4 billion)”, experts have said that it is increasingly important for African nations to diversify their economies and expand their non-oil export sectors.

The AGOA was introduced as a transformative initiative designed to catalyse economic growth and foster trade between the United States itself, Nigeria, and other eligible African countries.

It is a testament to international collaboration and embodies a time-sensitive opportunity that requires strategic and swift actions, stakeholders have said.

However, Femi Boyede of Femi Boyede Consulting opines that the opportunity is far gone now, and more emphasis should be on maximising the opportunities that the AfCFTA offers.

“If we are talking about a race against time, then what time are we racing against? The twenty-three previous years that we have wasted or the 15 months thereabout that are left?

“It’s important to ask this question now because another time has started again, two years ago; the AfCFTA.

“Are we going to be racing against this or the same things that clipped our wings for the twenty-three plus years of AGOA (with Nigeria being credited only with the proceeds of oil sales to the US when we can export 6,700 other products under the Africa Growth and Opportunities Act) will resurface?” Boyede remarked.

Read related news articles

US President Biden to welcome Kenyan President Ruto to the White House in May

President Joe Biden plans to welcome Kenyan President William Ruto to the White House in May, hosting a state visit after reneging on his promise to visit Africa last year. White House press secretary Karine Jean-Pierre said Friday that the visit set for May 23 will mark the 60th anniversary of U.S.-Kenya diplomatic relations and "celebrate a partnership that is delivering for the people" of both countries while affirming "our strategic...

18 February 2024

Kenya-US to deepen ICT, apparel and agriculture trade

Kenya and United States are in talks to identify areas of interest in information communication technology (ICT) sector that can interest US firms.  A meeting between The US Ambassador to Kenya, Megan Whitman, and the Cabinet Secretary for Investments, Trade, and Industry Rebecca Miano, the states sought cooperation in six key areas. The meeting laid the groundwork for an enhanced collaboration between Kenya and the United States in...

09 November 2023

AGOA extension crucial for Ghana’s industrialisation

The Deputy Minister of Trade and Industry Nana Ama Dokua Asiamah-Adjei is supporting the push for the extension of the African Growth and Opportunity Act (AGOA) to enhance trade between Ghana and the US. A United States Trade Act enacted on 18 May 2000 as Public Law 106 of the 200th Congress, the AGOA legislation has been renewed on different occasions, most recently in 2015, when its period of validity was extended to September 2025. The...

06 November 2023

US treasury Deputy Secretary Adeyemo visits Lagos, discusses duty-free access to the US market with local entrepreneurs

Nigerian-born United States Deputy Secretary of the Treasury, Wally Adeyemo, will be in Lagos, Nigeria between September 17 – 19, 2023, for a number of diplomatic engagements including a meeting with entrepreneurs and start-ups to discuss how they can sell their products by exploring “duty-free access” to the US market. Duty-free access is the permission given by a host country for another country to export goods into their country...

18 September 2023

Kenya President Ruto joins US-Kenya business roadshow in San Francisco

Kenya's President William Ruto will address leading US technology companies and investors on Friday at the US-Kenya Business Roadshow in San Francisco organised by the American government’s Prosper Africa initiative. The roadshow - also co-organised by the US Embassy in Nairobi - highlights the business and investment potential in Kenya’s booming tech sector, a statement from the US Embassy in Kenya said. The event is part of a...

15 September 2023

We want more Ghanaian exports in US market – trade minister

Mr. Kobina Tahir Hammond, Minister of Trade and Industry, says Ghana desires to increase its exports to the United States (US) market, arguably the most lucrative consumer market globally. He indicated that the Government had stepped up support for the private sector, both domestic and foreign, to enhance production and export capacity, particularly in the manufacturing sector, with notable opportunities for export into the U.S. market. The...

11 August 2023

Nigeria: US to 'create jobs for Africans through trade, investments in tech, infrastructure'

The United States govern­ment has expressed its willingness to create jobs through increased trade and investment in sectors such as agriculture, technology and infrastructure, as well as boost innovation and elevate the living standards of mil­lions of Africans. The U.S. Consul General, Will Stevens, disclosed this at the Africa Social Impact Summit 2023, themed: “Global Vision, Local Action: Reposi­tioning the African...

10 August 2023

AGOA boosts Kenya's textile exports to US, sector sees 7.2% growth

The African Growth and Opportunity Act (AGOA) has benefitted Kenya’s textile and apparel sector, leading to monthly exports to the tune of Sh4.5 billion, or Sh150 million per day, last year, according to a study by London-based Institute of Economic Affairs (IEA). The programme has had a positive impact on the country’s export-processing zones (EPZs), especially in the textile and garment sector. Kenya is the second-largest exporter of...

08 August 2023

Kenya's president meets US delegates on trade and investments

Kenyan President William Ruto has today held talks with US Trade Representative, Ambassador Katherine Tai. The discussions were based on US trade policy. Ruto said that the country is ready to strengthen the already existing relations between the two nations. "We will stretch our ties beyond the African Growth and Opportunity Act (AGOA) in the wake of advanced technology and climate change, for the full exploitation of our trade potential,"...

19 July 2023

US trade rep in Nairobi as Kenya's solo deals worry the EAC block [incl. Readouts]

The US trade representative is in Nairobi to co-lead a meeting that seeks Kenya's partnership in a fresh trade deal. The Trade and Investment Framework Agreement (TIFA Council) is pursuing various agreements even as regional peers express concern over Kenya's solo approach.  Yesterday, Trade Representative, Katherine Tai met patron circle members of the American Chamber of Commerce-Kenya (AmCham Kenya) ahead of today's...

17 July 2023

You are here: Home/News/Article/'Nigeria missing as Kenya, Ghana tap AGOA opportunities to boost foreign exchange earnings'