TRALAC - Trade Law Centre

Namibia seeks to take advantage of AGOA

Monday, 06 July 2015

Source: Fibre2Fashion

The Namibian government is working on a strategy to take maximum advantage of the African Growth and Opportunity Act (AGOA) that has been extended till 2025, the Namibian Press Agency has reported.

The original Act expires on September 30, 2015.

“We are now developing an engagement strategy on how best we can benefit from AGOA as well as ready ourselves for post- 2025 for the new World Trade Agreement compatible arrangement,” director of international trade in the ministry of industrialisation, trade and small and medium enterprise development Benjamin Katjipuka told the agency.

He said Namibia does not currently trade with the US under AGOA, but he commended Washington’s strong commitment to enhancing the Africa-US economic partnership.

AGOA promotes duty-free market access to the US, with the purpose to assist the economies of sub-Saharan Africa and to improve economic relations between the US and the region. It is aimed at moving Africans from poverty to prosperity by increasing their economic opportunities.

“Although we do not benefit much from AGOA, Namibia welcomes the new version of AGOA. We have been calling for a re-authorisation of 15 years, but still, the 10 years re-authorisation is a welcome development,” said Katjipuka.

In Namibia, he said, AGOA's benefits have not been fully utilised due to a number of challenges, in particular the closure of the Ramatex garment and textile factory in 2005, which left 600 people unemployed. Ramatex turned cotton into textile to export it to the US under AGOA.

“Since the closure of the Ramatex garment and textile factory there has not been any other significant industry that took up the US market under AGOA,” he said.

He said Namibia is currently trading with the US, but under the Most Favoured Nations (MFN) agreement.

The MFN agreement is a method of establishing equal trading opportunities amongst states.

It is a status or level of treatment accorded by one state to another in international trade. The country that is the recipient of this treatment, must, nominally, receive equal trade advantages as the 'most favoured nation' by the country granting such treatment.

Namibia's exports to the US in 2010 were valued at $ .15 billion and $ .23 billion in 2011; while in 2012 it decreased to $ .12 billion. This was followed by export volumes of $ .16 billion.

Imports from the US to Namibia were valued at $40 million in 2010, $37 million in 2011 and $30 million in 2012. In 2013, imports went up to $ .10 billion.

Namibian exports to the US mainly comprise uranium ore and concentrate; non-industrial diamonds; as well as refined copper and fish products.

“None of these products is eligible under AGOA. We trade in those products with the US, but under MFN,” Katjipuka said. 

 

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