- African Growth and Opportunity Act
TRALAC - Trade Law Centre
You are here: Home/News/Article/Swaziland: Economists predict doom and gloom over losing AGOA

Swaziland: Economists predict doom and gloom over losing AGOA

Swaziland: Economists predict doom and gloom over losing AGOA
The loss of the benefit spells doom for a lot of textile workers in Matsapha (Picture credit: Swazi Observer)
Published date:
Friday, 16 May 2014
Thembeka Dlamini

Economists are crying foul at the way government is handling the African Growth and Opportunity Act (AGOA).

AGOA is trade benefits that allow Swaziland to export a significant amount of its textile and clothing products to the US duty-free. 

Speaking anonymously, three economists concurred that the repercussions of losing these trade benefits will yield dire consequences for the country. 

*Nhlanhla Dlamini, an economist working in a government parastatal, said the loss of the benefit spells doom for a lot of the workers in Matsapha. He asked how over 10 000 people could be reabsorbed and employed while the employment rate of the country is so low. 

He said AGOA should have been a priority to the government a long time ago and not have these clandestine attempts at fixing the situation when it was too late in the day. 

The economist said it was a marvel the way government seemed to relax while the reports on the review of Swaziland’s status came to the fore in the February 23 edition of the Sunday Observer. 

He said losing these benefits would be a huge blow for an agri-based economy such as Swaziland and said the closure of all the firms would spell a socio-economic disaster in the short run and hinder the gains the country has made and strides towards attaining first world status which is His Majesty the King’s vision. 

He said it should be appreciated that the economic growth rate of the country would lag behind should it lose the benefit. 

The economist said whatever tax revenue to government that is generated from the textile factories directly or indirectly would also be lost.

*Muntu Kuhlase, a senior economist within government, said one of the effects of losing the AGOA benefits would be reductions of exports that the country makes. 

He said nearly E500 million ($50 million) worth of export value will be lost. 

He said these industries came to Swaziland due to the AGOA status and even though it might be argued that they gained more, they however have no obligation to stay in the country once the benefit is lost. 

He said it would  be easier for them to take their machinery elsewhere and restart where they will benefit from AGOA. 

He said the fact that most of the factory shells they operate from are government owned these factory owners have no real ties to try and produce apparel without the advantage of AGOA.

*Weziwe Bhembe, a private sector economist, the whole nation will be the biggest loser. He said since most of the employed factory workers are women, the whole nation should know that scales have tipped towards them being breadwinners. 

He said these women though they earn so little have a huge sphere of the financial support they offer since they look after their siblings, their own children and their parents. 

He said the social implications would be felt countrywide. Bhembe said looking at Matsapha, landlords will be affected since most of the houses were built with the assurance that workers will need accommodation. 

He said the numerous retail outlets would have to close from drastically reduced business. He said it is not just an issue for the textile industry but the every other industry that depended on the over 10 000 workers to support, directly or indirectly. 

Extract from the Sunday Observer, February 23, 2014.

In February when the Sunday Observer broke the story, the United States of America Ambassador to Swaziland Makila James was asked whether the benefits would be reinstated if Swaziland met some of the conditions, but not all of them. 

The ambassador responded that the conversation on the terms that Swaziland has to comply with for it to continue benefitting “...had not one, not two but several years going back, there is a great concern and great frustration that we have been extremely tolerant of the obstacles and challenges within Swaziland to meet some of these conditions. 

But it is important that Swaziland now understands that we are at a very critical point where they must meet all of the conditions and that is a very clear message that I hope the government will fully appreciate and will take on board.”

In the exclusive interview which took place on Friday, February 21, United States of America Ambassador to Swaziland Makila James said there was no longer any room for negotiations with the kingdom on the conditions that have to be met.

Listing the conditions, she said they include full passage of amendments to the Industrial Relations Act; full passage of amendments to the Suppression of Terrorism Act (STA); full passage of amendments to the Public Order Act; full passage of amendments to sections 40 and 97 of the Industrial Relations Act relating to civil and criminal liability to union leaders during protest actions; and establishing a code of conduct for the police during public protests.

Not some, but all of the conditions have to be met for Swaziland to continue enjoying the preferential trade agreement with the USA, the ambassador emphasised.


**In 2013, Swaziland exported E500million (US$ 49.749 million) worth of apparel to the US, showing a decline of 16.88 percent over exports of E600 million ($59.855 million) made in 2012, according to the Major Shippers Report released by the U.S. Department of Commerce.

*Not their real names.

**Info sourced:

Read related news articles

Time for Eswatini's entrepreneurs to seize AGOA opportunities

The time has come for young emaSwati entrepreneurs to seize opportunities to manufacture basic every day consumer products for export to the US under the African Growth and Opportunity Act (AGOA). The main drive is to get emaSwati to manufacture products locally, sell locally, regionally and internationally using the various initiatives made available by government.  Eswatini’s economy is at a crossroads. While the country boasts a...

13 February 2024

Eswatini exports 26 thousand tons of sugar to the US

About 26 535 tonnes of sugar is shipped yearly to the Unites States of America through the African Growth and Opportunity Act (AGOA). Eswatini Sugar Association (ESA) Logistics Manager, Sibusiso Hlandze said the local sugar was exported  to a terminal in Maputo, Mozambique. He said the terminal,called the Sociedade Terminal De Acucar De Maputo (STAM), played a significant role in the country's sugar industry. It is owned by four sugar...

22 August 2023

Eswatini's AGOA exports at over $8m

The country’s performance in AGOA was highlighted by Tammy Dlamini, who is the Senior Country Representative (Eswatini and Angola) for the USAID Africa Trade and Investment Southern Africa Buy-in Activity.  In his presentation it was noted that the country’s exports to the United States (US) in 2022 was over E1.4 billion, while in 2021 it was E669 164 496 and E387 702 611.40 in 2021. Dlamini said the US was a big market worth...

17 July 2023

Swaziland: Is 2018 the year for its textile workers?

Can the year 2018 be a turning point for textile workers’ prolonged poverty? The workers in the textile industry said as they got into the new year and edged closer to this year’s negotiations which are scheduled to start next Wednesday, they would be demanding that government should adhere to TUCOSWA’s call for a basic minimum wage, which would see them as part of the least paid workforce, getting at least E3 000 per month. This means...

25 January 2018

Swaziland: "We should learn from AGOA loss"

Two years ago, I wrote on this very column how disappointing government was in the handling of the African Growth and Opportunity Act (AGOA) issue.  I remember vividly describing it as a catastrophe so dreadful to be likened to Tsunami proportions. Last week, United States (US) President Donald Trump gave a green light to the restoration of the country’s eligibility for AGOA, which in all honesty is massive relieve for the country and...

31 December 2017

US restores trade benefits to Gambia, Swaziland

U.S. President Donald Trump on Friday restored trade benefits to Gambia and Swaziland under the African Growth and Opportunity Act (AGOA), the U.S. Trade Representative’s Office said. [See text of Proclamation here] The AGOA trade program provides sub-Saharan countries duty-free access to the United States on condition they meet certain statutory eligibility requirements, including eliminating barriers to U.S. trade and investment and...

23 December 2017

Presidential Proclamation to take certain actions under the AGOA and for other purposes

In Proclamation 9223 of December 23, 2014, President Obama determined that the Republic of The Gambia (“The Gambia”) was not making continual progress in meeting the requirements described in section 506A(a)(1) of the Trade Act of 1974, as amended (the “Trade Act”) (19 U.S.C. 2466a(a)), as added by section 111(a) of the African Growth and Opportunity Act (the “AGOA”). Thus, pursuant to section 506A(a)(3) of the Trade Act (19 U.S.C....

23 December 2017

Eligibility reviews: Press statement in support of Swaziland’s eligibility status for AGOA

The Amalgamated Trade Union of Swaziland (ATUSWA) representing 9 000 workers in the textile and apparel industry, the Trade Union Congress of Swaziland (TUCOSWA) representing 40 000 workers and 16 affiliated unions, and the IndustriALL Global Union representing 50 million workers in 140 countries met in Manzini, Swaziland on the 29th of August 2017 to discuss the status of the United States Trade Act – the African Growth and Opportunity Act...

04 September 2017

Swazi king signs public order, terrorism amendment bills

His Majesty King Mswati III has given assent to the Public Order Bill and the Suppression of Terrorism amendment Act. The King endorsed the two Acts last week Tuesday. This comes as good news as this means that Swaziland is a step closer to regaining its African Growth and Opportunity Act (AGOA) status. Swaziland was removed from AGOA in January 2015.  

15 August 2017

US urges Swaziland to review terrorism law as precondition for AGOA readmission

The United States has asked Swaziland to redefine ‘Terrorism Act’ before it could be reconsidered for the African Growth Opportunity Agreement (AGOA). This was stated by Prime Minister Banarbas Dlamini when giving feedback to Senate Portfolio Committee in Parliament during the debate of the Suppression of Terrorism Amendment Bill No. 10 of 2010 on Wednesday. The premier said during the discussion of the bill with the Americans and the...

05 July 2017

Swaziland: 'One month to AGOA review cycle'

Swaziland has one month to work on the remaining AGOA benchmarks as this year’s AGOA review cycle will begin in June until September. AGOA is the African Growth and Opportunity Act, a United States Trade Act enacted on May 18, 2000 as Public Law 106 of the 200th Congress.  The legislation significantly enhances market access to the US for qualifying Sub-Saharan African (SSA) countries. While working on the remaining benchmarks, which...

01 May 2016

You are here: Home/News/Article/Swaziland: Economists predict doom and gloom over losing AGOA