TRALAC - Trade Law Centre

Namibia Urged to Expand Agoa Scope

Monday, 26 September 2005

Source: New Era (Windhoek)

United States of America's Ambassador to Namibia, Joyce Barr says Namibia should move beyond the apparel sector and focus on other items that are eligible to enter duty free into the US market through the Africa Growth and Opportunity Act (AGOA).

Around 7 000 items are eligible to enter duty free into the US market through AGOA, to which about 37 Sub-Saharan countries export.

Namibia's main export to the US through AGOA remains textile and apparels.

To fully capitalise on the AGOA legislation, Barr urged Namibia to focus more on the more than 6 400 items where AGOA countries have trade preferences.

Such products, she said, would include leather goods, glassware products and processed agricultural goods.

Apart from textile and apparel items, Namibia also exports folklore items such as woodcarvings and others made out of clay. In 2004, all of Namibia's AGOA specific exports originated from the apparel sector, but the country's largest single export to the USA in 2004 was zinc. Zinc entered duty free under the US General Systems of Preferences (GSP) programmes.

"The key areas where we need to focus are not commodities, but value added products. These are the areas where AGOA provides an immediate tariff benefit that is not available to the majority of the US trading partners," Barr added.

Last month, at a workshop on the government policy on WTO Multi Fibre Agreement and its impact on the local economy, the Ministry of Trade and Industry said although Namibia could export close to 7 000 products, the country had no capacity to meet the demand of the US market.

Permanent Secretary Andrew Ndishishi said at that workshop the country was facing a challenge as it had a shortage of skilled personnel and capital to venture into value addition.

He said Namibia exported mainly unprocessed minerals although it could send out industrial goods.

"We are not restricted but we don't have the capacity to supply," he said, adding that the country did not have the capacity to increase production and generate wealth.

Another official from the ministry said ignorance on the part of the population was also a contributing factor for not capitalising to the full on the available market.

He said people did not know that they could export to the US, probably because the ministry has not done enough information dissemination.

The other problem the official noted was that businesses operate on an individual basis, which was a problem especially when they have to export goods.

"If you have to send a consignment of goods to the US, you can manage if you do it as a group, and not as an individual," he said, adding that this would also limit costs.

With the politics involved in exporting agricultural products, commentators say that countries have leverage when it comes to industrial goods.

Namibia is not so much industrialised and is a member of the Southern Africa Customs Union (SACU) whose five member countries' market borders are wide open. South Africa being the most industrialised in Africa has also flooded the market in the union with its products, which makes it difficult for a new company in Namibia to enjoy the same economies of scale.

An Africa Competitiveness report 2005 says Namibia's economic strengths and potential growth sectors include minerals and mining, fisheries, livestock and metal products, other agricultural products and textiles and apparel.

It identifies one of the major challenges to export growth as the country's inability to meet standards.

"Namibia's lack of capacity in addressing standards, quality, accreditation is a major domestic impediment to increased exports, "says the report.

Namibia's exports under the AGOA and other General Systems of Preferences (GSP) last year amounted to approximately N$1 billion. This comprises 65 percent of Namibia's total exports to the Unites States.

The country's main export markets are Spain, the United Kingdom, the US and France, to which it exports fish, meat products, precious stones, chemicals, diamonds and minerals and other base metals.

Almost 97 to 98 percent of Namibian products enter the American market duty and quota free under AGOA and other trade preference programmes.

The report says that gem quality diamonds and unprocessed minerals and metals such as zinc, copper, uranium and lead will continue to dominate Namibia's exports.



“AGOA Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of Namibia’s bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.