TRALAC - Trade Law Centre

African Ministers Leave Forum Hopeful But Uncertain of AGOA's Future

Thursday, 11 December 2003

Source: United States Department of State (Washington, DC)

"You have to compete, period. Don't identify the Chinese or the Vietnamese as a problem," Constance Hamilton, the senior director for African affairs at the U.S. Trade Representative's Office, said she told African delegates to the third AGOA Forum, meeting in Washington December 9-10.

The forum, officially the "United States-Sub-Saharan Africa Trade and Economic Cooperation Forum," took place at the State Department, with complementary concurrent sessions at other venues sponsored by the private sector December 8-9 and the civil society network December 8-10.

During a wrap-up briefing at the State Department December 10, a reporter cited the concern that had been expressed by many African countries about the lifting of apparel and textile quotas under the Multifiber Agreements, expected in January 2005, especially a fear that the Chinese are going to "come in and dominate the market" that the Africans have carved out in the United States under AGOA, the African Growth and Opportunity Act.

Hamilton said that in a series of meetings on handcrafts, when African exporters cited their concern about Chinese involvement, the answer was "compete." They should ask themselves, she said, "Are you meeting quality standards? Are you being able to diversify? Can you produce and market? We all ought to be emphasizing that rather than looking for a straw person to knock down." She said that changed the viewpoint to "a much more constructive way to look at how you become a competitor in the global market."

Jendayi Frazer, senior director for African affairs on the National Security Council, said that one of the objectives of the AGOA Forum "was to get countries to think about things beside textiles and apparel. AGOA has over 6,000 products lines that are actually available under AGOA and we are trying ... to encourage countries to take advantage of the other elements of AGOA.

Asked how successful AGOA has been in creating jobs and increasing exports, Frazer said the U.S. Trade Representative has those figures, but she could say specifically that "to the end of this year, at least $3 billion has been generated in new exports under AGOA goods."

As to job creation, Frazer said she knew of several countries' experiences. In Lesotho, South Africa and Swaziland, she said, tens of thousands of jobs have been created -- "38,000, I think, in the case of Lesotho," she added.

Asked if the Millennium Challenge Account (MCA) is making a difference in Africa in terms of transparency and good governance (which are requisites for greater assistance), she said the MCA funds have not yet been appropriated, "but in anticipation of that funding ... we've seen concrete movement in many African countries trying to be in a position to qualify in the first year."

President Bush originally requested $1.3 billion "and the administration has argued very forcefully to the Hill [Congress] that at least $1 billion is necessary," she said.

"If we get to a billion, which is what we're all hoping for, that doubles our existing aid budget," pointed out Acting Assistant Secretary of State for Africa Charles Snyder.

A reporter asked if there is real commitment to MCA goals of good governance, accessibility to education, anti-corruption actions, and the other stipulations for receiving funding, or whether it's mainly a matter of money.

Snyder said that the countries the United States will select are serious about reform. "We've made it clear this is a selective process, this is not one size fits all... And they know that they're more likely to be selected, the Ghanas of the world and so on, because of what they've already done in terms of democracy, human rights and economic performance, and delivering the goods to the people. ...

"I suspect some of them are strictly hoping to cash in to some degree, but they'll learn from the ones that actually get the money that this is a real process. And so the second year, hopefully, we'll be able to expand to a few more and we'll begin to get converts in practice."

Trade, finance and foreign ministers from 37 AGOA-eligible countries attended the forum, as well as leaders of regional economic organizations and other economic organizations from throughout the continent, Snyder said. "These are the ... ministers who make things happen," he said, "and they're asking us the right questions."

An important aim of the forum, he explained, is for participants "to understand the mysteries of how the U.S. government operates, and that that kind of exchange is really where they get that, from practitioners, NGOs, businessmen, and also from being able to get at us directly and ask those kind of questions -- 'What does that mean?'"

There will be no formal document coming out of the AGOA Forum, he said. "This is not the G8. This is more a nitty-gritty, deal-making, learning, mutual education process."

(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)