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Botswana advised to develop AGOA strategy

Botswana advised to develop AGOA strategy
Lesotho Minister of Trade and Industry Coopetatives and Marketing Joshua Setipa
Published date:
Wednesday, 20 April 2016
Isaac Pinielo

Botswana has a more competitive advantage over its sub-Saharan Africa counterpart countries when it comes to utilising the benefits of the African Growth Opportunity Act (AGOA), a Lesotho government official has said. 

Speaking yesterday at a seminar aimed at sensitising the business community and the civil society on the new AGOA legislation (2015-2025), Joshua Setipa, who is Lesotho’s Minister of Trade and Industry, Cooperatives and Marketing said Botswana needed to focus on a number of elements in order to fully benefit from AGOA, including coming up with a national strategy.

He stated that for Botswana to boost its participation under AGOA, it should increase its local participation and involvement in industry.

“The Botswana government has to develop a national strategy in which industry is part and parcel of, and the perfect strategy has to be forward-looking,” he said.

AGOA gives duty and quota free market access to the U.S for certain lines of goods from Botswana and 39 other African states.

Setipa emphasised the need to promote citizen entrepreneurship and support of locally owned industries, with the goal of affording smaller enterprises a more important role in the economy through building industrial linkages with foreign businesses.

In developing the strategy, Setipa said it should be one that could help diversify the market, noting that there were other opportunities for Botswana such as footwear production.

He highlighted the need for continuous improvement of the environment for doing business, stating that one of the factors that made Lesotho successful in utilising AGOA was that it had invested a lot in improving the business environment.

Lesotho has managed to establish one of the largest textiles and garment manufacturing industry in sub-Saharan Africa, following its development of a National AGOA Response Strategy with the overarching objective of improving and up-scaling the implementation of AGOA. The strategy was also aimed at establishing a diversified manufacturing sector.

Until recently, it has consistently been the number one exporter of apparel to the U.S under AGOA among the sub-Saharan African countries.

Giving his remarks, US Embassy Deputy Chief of Mission, Tim Smith, said AGOA was particularly important for Botswana’s companies because it provides an opportunity to take your business to the next level. “It takes a globally competitive company to meet the timeline, quality, and price demands of the U.S market,” he said.

He said AGOA also provided a head start over competitors from Asia and other regions, noting however that the competition remains fierce.

“And that is a good thing because we need globally-competitive companies to lead Botswana diversification through exports,” said Smith.

Under the new legislation, he said, the U.S Congress called on eligible AGOA countries to develop biennial utilisation strategies to more effectively and strategically take advantage of benefits under AGOA.

Botswana exports to the U.S stood at $7.5 million (P189.04m) last year down from $9 million (P97.2m) in 2014.

Smith said the U.S Embassy, through the United States Agency for International Development (USAID), supported a five-year $15 million (P166.5 million) Development Credit Authority (DCA) with Barclays Bank Botswana to provide access to credit for small and medium enterprises and entrepreneurs.

Smith pointed out that the U.S Embassy wanted Batswana to leverage resources and market access to grow their businesses, diversify Botswana’s economy, create jobs and boost bilateral trade.

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