TRALAC - Trade Law Centre

Kenyan Manufacturers Hail AGOA 2012 Extension

Thursday, 14 December 2006

Source: People's Daily Online (China)

Kenyan manufacturers on Wednesday welcomed the third-country fabric provision of the African Growth and Opportunity Act (AGOA) until 2012, which allows eligible African countries to export apparel to the United States even if the fabric came from another country.

The provision was set to expire in 2007, but the U.S. House and Senate leaders forged an agreement on the extension earlier last Friday.

Chairman of the Kenya Apparel Manufacturers and Exporters Association (KAMEA) Jas Bedi welcomed the AGOA extension, hailing the new bill as a good Christmas gift for the African Cotton and Textiles Industries Federation (ACTIF) group which has been involved in intensive lobbying for the last two years.

"Hopefully we will be able to nurture our industry and become world class textile and apparel players in this gestation period," Bedi who is also ACTIF chairman, the apex body for textile industries in sub-Saharan Africa said in a statement.

He called on the Kenyan government to immediately facilitate an open forum to dialogue and discuss ways and means to go forward.

Bedi warned that unless African governments are keen to take interest in assisting the apparel sector to move forward, no further improvements should be expected from the sector despite such an extension.

On Dec. 8, the U.S. House and Senate passed the trade package including the AGOA amendments, also known as the AGOA Investment Incentive Act 2006, extending the third-country fabric provision for Lead Developed Countries (LCDs) to 2012 and restoring the full 3.5 percent cap.

The AGOA amendments will become law as soon as they are signed by President George W. Bush, which is expected to come before Christmas.

"The buyer uncertainty killing this industry is now over and hopefully will bring renewed business to Africa with much anticipated growth and success," said Bedi.

The AGOA amendments also provide for inclusion of the abundant supply provision for yarn/fabric found to be readily available in Africa in commercial quantities, including the designation of denims being currently available in abundant supply up to 30 million square meter equivalents.