The trade agreement that allows sub-Saharan African countries preferential access to US markets should be changed to be more impactful, according to a top US trade official.
The African Growth and Opportunity Act (Agoa) has failed to meet expected targets since it was launched in 2000, says deputy US trade representative Constance Hamilton.
“We do believe that not trying to change the programme and make it better is a wasted opportunity. At USTR [US Trade Representative] we do think there are things that can be done to make the programme more impactful, and we hope Congress will take a look at those things,” Hamilton said in a press briefing.
“Agoa has not met the expectations we had in 2000, and so while they’re not saying the programme hasn’t been useful, because some countries have benefited greatly from Agoa, but the majority have not.”
The forum will be held in Johannesburg where one of the main discussions will be how to improve the programme as the deadline for its renewal — it expires in 2025 — nears.
“After almost 25 years, we know that very few countries are actually taking advantage of this programme. And of the sectors that are open and available, very few of those are actually being used,” said Hamilton.
“So the question that’s going to drive the conversation at the Agoa forum in Johannesburg is how do we improve on this programme.”
During a pre-Agoa press briefing last week, trade industry & competition minister Ebrahim Patel said SA would be pushing for more benefits in the trade agreement.
“What we are seeking to do is provide a platform in the discussion to reflect on the experience that the African continent and the US has had on Agoa, to look at how we can get more from the trade relationship by complementing Agoa with other measures and the common African position on Agoa, which is to have it renewed for an additional 10 years,” said Patel.
Agoa provides preferential access for about 20% of SA exports to the US, or 2% of SA exports globally.
Fears were raised earlier in 2023 that SA would not host the Agoa Forum and that the country would be removed from the list of beneficiaries. This was after a request in June by a bipartisan group of US legislators to secretary of state Antony Blinken, national security adviser Jacob Sullivan and US trade representative Katherine Tai for the forum to be held in another country.
The legislators pointed to SA’s perceived closeness to Russia in its war with Ukraine. US-SA trade relations became strained after Washington accused SA of providing weapons to Russia in its war on Ukraine, a charge Pretoria denied.
An inquiry commissioned by President Cyril Ramaphosa into the matter cleared SA of wrongdoing.
“The US is also important as an overall trading partner and as SA’s second-largest national trading partner. The American market is a tough one to get into and to stay in because companies around the world compete to get a part of the world’s biggest market — and the fact that we are succeeding is great,” said Patel.
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