Swaziland: Fighting to save AGOA
MBABANE - As electrical workers scramble atop new 30 metre-tall pylons to connect power cables that will electrify an expanded Matsapha Industrial Estate in central Swaziland, industry and government leaders are working to safeguard vital trade privileges with the United States.
"The Americans are giving us a chance to jump-start our economy through foreign trade, and no one wants to blow this opportunity," Marc Svenningsen told IRIN.
Svenningsen, the director of Express Cargo in Matsapha, which transports goods made in Swaziland to South Africa and Mozambique, was referring to the US trade scheme, the African Growth and Opportunities Act (AGOA).
AGOA allows Swazi goods to enter the American market duty free, giving them a competitive advantage against other importers.
Swaziland's duty-free exports to the United States under
AGOA were valued at US $14.8 million in 2001, primarily textiles, apparel, and agricultural products. Since then a number of new factories have opened, geared to the US market.
Enterprise and Employment Minister Lutfo Dlamini announced this week that by year's end, at Matsapha alone, 1,400 manufacturing jobs would be created linked to AGOA.
The Swaziland Industrial Promotion Authority has optimistically projected tens of thousands of new jobs next year - which would significantly cut the current 40 percent unemployment rate.
Most of these jobs would come from new or expanding Taiwanese-owned garment factories eager to take advantage of the perks of AGOA. However, there are two problems that might lead to the termination of Swaziland's participation in AGOA - worker exploitation and trans-shipment violations.
Some garment factories in Swaziland, although modern and efficient, have been described as sweatshops by activists in terms of the alleged treatment of local staff.
Dlamini, as enterprise and employment minister, must both attract foreign investment while ensuring workers' welfare. He recently ordered an end to non-payment of overtime, of locking workers inside factories to meet shipping deadlines and working without breaks.
"There is no way we are going to lose AGOA because a few factories are violating workers rights," Dlamini said. "As government we value job creation, but we do not want it to infringe on the rights of workers."
The issue of trans-shipments - whereby the raw materials are imported from the garment factory's home country, may ultimately decide the fate of the export sector.
US trade officials told their Swazi counterparts this month that the country had two years to produce the raw materials that go into the garments, or those goods could not enter American market. Importing the raw materials is a violation of trans-shipment rules.
Trade representatives in Swaziland and Lesotho have asked for a time extension, saying neither small country can be expected to create out of nothing fabric production needed for textile factories in only two years.