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US government discusses AGOA extension

Published date:
Thursday, 19 May 2011

The United States (US) government is discussing with members of Congress on the proposed extension of the African Growth and Opportunity Act (AGOA), the third country fabric clause and the admission of Africa's youngest country, southern Sudan.

And the AGOA eligible countries have been advised to ensure regional economic integration approach since national markets were too narrow for the US investments and exports.

Deputy assistant US trade representative for Africa, Constance Hamilton said the US office of African affairs took the calls for the extension of both the Act and the third country provision on apparel and textiles seriously.

Ms Hamilton said on Tuesday during a conference call with journalists in various AGOA eligible countries that her office had engaged some congress men and women on the issues of AGOA.

The AGOA is an Act of the US Congress which was enacted in 2000 to give preference to about 1,800 tariff line products from the Sub-Saharan Africa (SSA) but is scheduled to expire in 2015 while the clause on third country fabric will expire in September next year.

As at now, she said the expiry of the Act and the provision on textile stand until the Congress decides on the way forward.

She said her administration was determined to continue ensuring mutual benefits for

US and the AGOA eligible countries.

She said apart from the two issues, some members of the Congress were engaged on the possible admission of southern Sudan.

She said following the referendum on separation from main Sudan, there was need to decide whether to admit it into AGOA or not.

Southern Sudan will become a full independent State in July this year.

Ms Hamilton was responding to a question on what other issues concerning AGOA her department was discussing with the selected members of the Congress.

On Zimbabwe, she said the Southern African country could not be admitted to AGOA because it has not yet met the criteria of eligibility on such issues like human rights, corruption and generally good governance.

She said in response to a question from a Zimbabwean journalist on why the US has not allowed Zimbabwe to join the AGOA, that the Robert Mugabe-led country does not meet the basic requirements under the Act.

On why the US investors are seemingly uninterested in investing in the local economies in Africa, Ms Hamilton said with the introduction of AGOA a lot of business people in America were now keen to invest in Africa.

"There will be a lot American investors who will be attending the AGOA Forum in Lusaka in June this year," she said.

She, however, called for the integration of economic regional bodies to increase the market and reduce on the cost of production for the goods from the SSA region.

She said investors from the US wanted big markets for their products and therefore they could only effectively invest in Africa if they were assured of the ready and big markets.

Ms Hamilton cautioned the AGOA eligible countries that the Act was not a (magic bullet) for all the challenges the SSA countries were facing but that there was need to address various issues like supply constraints individually.

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