US Congress renews AGOA for another 10 years

KenteThe US Congress on Thursday, June 11, 2015 renewed the Africa Growth Opportunities Act (AGOA) for another 10 years, according to information accessed by

The trade agreement will end in 2025.

The information indicates that an overwhelming 392 against 32 of members of Congress voted for the renewal indicating a bipartisan endorsement of AGOA.

AGOA is a major trade policy of the US government initially enacted on May 18, 2000 until 2008, but was amended in 2004 to expire in 2015 to allow increased market access to some 40 eligible sub-Saharan African (SSA) countries to export approximately 7000 products lines duty free quota free to the US market.

Despite being a major trade policy for the US, beneficiary countries have not been able to take advantage of such a policy to drive economic growth. In a May 2015 article by Madjie Simon, the Executive Secretary of the American Chamber of Commerce in Ghana, countries like Kenya, Lesotho and Mauritius provide the bulk of apparel exports under the programme. According to Simon, in 2014, Kenya exported $423 million worth of apparel to the US under AGOA, Lesotho, $289 million; Mauritius, $227 million and Swaziland, $77 million.

In the next 10 years, exports of textiles and apparel from African countries to the US under AGOA are expected to reach $4 billion, according to a Reuters report.

The report notes that in 2014, US clothing imports from sub-Saharan Africa countries reached $986 million, up nearly six percent from 2013.

AGOA is also said to have fueled growth in Africa-US trade since the act came into operation. AGOA-related non-oil exports from Africa have grown five-fold to $53.8 billion from $8.1 billion over ten years, by 2011.

On the contrary, total exports from Ghana to the US reduced from $779,001 in 2011 to $273,280 in 2014 indicating that Ghana is yet to take full advantage of AGOA.

Over 67 percent of Ghana’s exports to the US are agricultural products. The remaining are principally textiles and apparel, forestry and mineral and metal products.

By Emmanuel K. Dogbevi & Dode Seidu

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