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AGOA Trade Act Seen as Key to African Economic Success

Published date:
Thursday, 01 March 2007

Landmark legislation (the AGOA) enacted seven years ago to enhance trade between the United States and Africa still holds the key to continued African growth and development, says Assistant U.S. Trade Representative (USTR) Florizelle Liser.

The African Growth and Opportunity Act (AGOA) has been "a clear success" for sub-Saharan African economies, Liser said at the opening of the Central Africa AGOA Regional Workshop, held in Douala, Cameroon, February 27-28. Imports into the United States under the trade act increased more than fivefold in the past five years, a clear spur to export-led growth in Africa, she told the audience.

Liser said the idea behind the AGOA/Douala workshop -- hosted jointly by the USTR and the U.S. Agency for International Development (USAID) -- was "to expand AGOA’s impact over more eligible countries and in more product areas."

Signed into law by President Clinton in May 2000, AGOA extends duty-free market access to 6,000 African products, including processed foods, furniture and home decor, as well as apparel, footwear and a wide range of manufactured goods. Two enhancements of the law, extending favorable trade benefits to African nations willing to reform their economies, were signed into law by President Bush in August 2002 and July 2004. Thirty-eight African nations are now eligible for AGOA's benefits.

Liser mentioned the region’s "unique and highly prized products –- whether specialty coffee from Rwanda, honey wine from the Republic of Congo, fruit juices from Cameroon, hardwood furniture from Gabon, fine handcrafts from Chad and the Democratic Republic of Congo or spices and herbs from Burundi and Sao Tome and Principe." Liser told her listeners: "There is a market in the United States for all of these products and many more, and we want to help you to tap into it."

According to a USAID announcement, 150 representatives from AGOA-eligible countries in the region were invited to Douala "to network, share lessons learned and talk with industry specialists from the United States."

The Douala conference was the fourth in a series of U.S.-sponsored regional AGOA workshops held earlier in Ethiopia, Ghana and South Africa.

In the important area of textiles, Liser cited apparel imports from Africa under AGOA, which jumped 251 percent since 2001 to more than $1.3 billion.

Other AGOA success stories she mentioned included the following:

Cameroon's export of nearly $1 million worth of goods other than oil to the United States in 2006, including rubber products, kola nuts, finished wood products and some food items.

Kenya’s growing exports of fresh-cut roses, prepared pineapple, nuts, essential oils and apparel.

The Democratic Republic of Congo's export of $2.6 million worth of refined copper, tungsten ores and ginseng.

Plywood exports worth $200,000 from Gabon in 2005.

Rwanda’s deal to export baskets to Macy's, one of the top American retail chains. (See related article.)

Acknowledging a decline in AGOA apparel imports in 2006, Liser said: "There are signs that African apparel makers are making a comeback. Last week, I attended a major apparel show in Las Vegas and was impressed at how many buyers were making inquiries with African producers, including a Ugandan company that has begun to export T-shirts made of 100 percent organic Ugandan cotton."

To help African producers and traders take advantage of AGOA, Liser said, the United States provides "trade capacity-building assistance" for sub-Saharan Africa that exceeded $1 billion over the past five years, including $393 million in 2006 alone.

At the same time, USAID, through its four regional trade hubs on the continent, is "carrying out a wide array of activities to help African countries make wider use of the opportunities available under AGOA," she added.

Most prominent among these efforts, Liser said, is President Bush’s African Global Competitiveness Initiative (AGCI).

Liser said the goal of AGCI, which will provide up to $200 million over five years, is to promote the export competitiveness of sub-Saharan Africa by "improving the business and regulatory environment, strengthening the knowledge and skills of African enterprises, increasing access to financial services for trade and investment and facilitating investments in infrastructure."

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