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USTR releases 2016 report on AGOA implementation to Congress

Thursday, 30 June 2016 Published: | USTR

Source: United States Trade Representative

The U.S. Trade Representative presented to Congress today a comprehensive report on implementation of the African Growth and Opportunity Act (AGOA) – the cornerstone of the  U.S. trade and investment relationship with sub-Saharan Africa.

The report is statutorily mandated by Congress under the Trade Preferences Extension Act of 2015 to be submitted one year following the enactment of the Act, and biennially thereafter.  

The 2016 Biennial Report on the Implementation of the African Growth and Opportunity Act details the U.S.-sub-Saharan African trade relationship, analyzes country compliance with eligibility criteria, highlights regional integration efforts, and summarizes the trade capacity building assistance that various U.S. government agencies provide to Africa.  The report also provides information, requested by Congress, regarding out-of-cycle AGOA eligibility reviews and potential trade agreements with sub-Saharan Africa.

“This report highlights the important and growing U.S. trade and investment relationship with our sub-Saharan African partners”, said U.S. Trade Representative Michael Froman. “AGOA is a vital part of that relationship and, with the historic ten-year renewal of the program now in place we look forward to working with sub-Saharan African countries to maximize AGOA utilization and to begin exploring a path for a long term, predictable, and mutually beneficial U.S.-Africa trade relationship beyond AGOA.”

AGOA has continued to support non-oil exports and the diversification of African trade with the United States. Sub-Saharan non-oil exports to the United States under AGOA have nearly tripled from $1.4 billion in 2001 to $4.1 billion in 2015, mainly due to increased exports of autos and parts, apparel, fruits and nuts, cocoa, prepared vegetables, footwear, and cut flowers. However, total SSA exports to the United States declined slightly in 2015 due to falling oil and other commodity prices. U.S. exports to sub-Saharan Africa totaled $17.8 billion in 2015, up 202 percent compared to 2000, and U.S. investment stock in sub-Saharan Africa stood at $34.4 billion in 2014 compared to $9 billion in 2001.

Highlights from the 2016 report include:

  • Thirty-eight of the 49 sub-Saharan African countries are eligible for AGOA.  During the most recent review, Burundi’s eligibility was terminated effective January 2016 due to its failure to meet rule of law, human rights, and political pluralism eligibility criteria.
  • South Africa’s AGOA eligibility was reviewed in an out-of-cycle review in July 2015, due to concerns about several longstanding trade barriers, including with respect to U.S poultry, beef, and pork imports.  The review resulted in a determination that South Africa was failing to meet the AGOA eligibility criteria, and the issuance of a proclamation suspending AGOA benefits for agricultural products from South Africa.  Prior to the effective date of the suspension, however, South Africa took actions to resolve the concerns raised by the Administration, avoiding suspension of its AGOA benefits.  
  • As African leaders intensify efforts to increase regional integration and link together their markets, U.S. companies are taking advantage of these larger markets that make trade and investment more attractive on the continent.  Under African Union leadership, a number of African regional economic communities are moving toward regional and Africa-wide trade and economic integration to promote both continent-wide trade as well as greater engagement in the global trading system.
  • A number of U.S. government agencies are supporting African economic development through a range of trade capacity building programs. These include, among others, bilateral and regional initiatives of the Departments of State, Commerce, Agriculture, and Labor, as well as programs of the U.S. Agency for International Development, the U.S. Trade and Development Agency, and the Millennium Challenge Corporation. 
  • Even as the United States works with African partners to maximize AGOA utilization, we are examining ways to enhance the U.S.-Africa trade relationship beyond AGOA. Some countries – including Kenya and Mauritius – have expressed an interest in establishing more mature, long term trade relationships with the United States, including by entering into free trade agreements.  The issue of a U.S.-Africa trade relationship that expands beyond AGOA will be a focus of the AGOA Forum in 2016 and our engagement with sub-Saharan African trading partners going forward.

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