TRALAC - Trade Law Centre

Mauritius, Zambia plea for AGOA fabric rule extension

Thursday, 10 May 2012

Source: Finbre2Fashion

The ambassadors of Mauritius and Zambia to the US have made a joint appeal to the US Congress to extend the third-country fabric provision under the Africa Growth Opportunity Act (AGOA) for the benefit of workers and businesses in the African countries as well as in the US.

They said the passage of legislations S. 2007 and H.R. 2493 would enable the US to continue to receive high-quality textiles and apparels from Africa at competitive prices. 

The third-country fabric rule allows AGOA beneficiary countries to use yarns and fabrics from any country in the manufacturing of their textiles and clothing for export to the US at zero-duty.

The provision has been the main driver behind the growth of the African apparel industry under AGOA. It makes up 95 percent of AGOA garment trade and has helped African exporters to offer their products to the US at competitive prices.

In Mauritius, for example, the textile and garment industry is the biggest employer in the private sector. In 2010, its apparel and textile exports grew by 25 percent after the renewal of its eligibility for the third-country fabric provision in 2008.

The third-country fabric provision accounts for nearly 70 percent of Kenya’s overall textile and clothing exports to the US.

In Swaziland, almost 98 percent of the textile and garment exports are under the third-country fabric provision. The textile and apparel industry is a source of livelihood to about 300,000 people, i.e. around 25 percent of the country’s total population.

And in Lesotho, the textile and clothing industry has grown to become the leading employer from virtually being non-existent prior to AGOA. Today, the industry employs 40,000 people, of which around 34,000 are women.

Thus, in view of the significance of AGOA third-country provision for the economies of African countries, the two Ambassadors requested the US Congress for an early extension of the provision, which is to end on September 30, 2012.

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