US says plans underway to improve AGOA
Monday, December 12, 2022
Workers at Pink Mango garment factory at Kigali Special Economic Zone. AGOA gives countries in Sub-Saharan Africa preferential access to US markets, allowing them to export products tariff-free. Craish BAHIZI

The US government says it is willing to work with African countries to deepen and broaden trade relationships, including existing trade negotiations.

The development was announced ahead of the upcoming US-Africa summit, which is slated for Tuesday, December 13, in Washington.

According to the outlook, US Strategy Towards Sub-Saharan Africa, the American government also pledged to support AGOA- African Growth and Opportunity Act- as well as implementation of the African Continental Free Trade Area agreement (AfCFTA).

"We will work with willing African partners to deepen and broaden our trade relationship, including trade negotiations, to deliver equitable and inclusive prosperity,” the report reads in part.

"We will work with the Congress on the future of Agoa, which expires in 2025, and will support the AfCFTA’s implementation.”

The US pledged to assist African countries to more transparently leverage their natural resources, including energy resources and critical minerals, for sustainable development while helping to strengthen supply chains that are diverse, open, and predictable.

With the US government now exploring ways of renewing the agreement, The New Times has learnt that Rwanda maintains its position, and reliable sources say that there has not been any fresh attempts to change track.

AGOA gives countries in Sub-Saharan Africa preferential access to US markets, allowing them to export products tariff-free.

However, Rwanda was suspended from the list of now-37-countries following a decision by Kigali to raise tariffs on second-hand clothes to protect the local industry.

The idea, officials said, was to reduce importation of large amounts of cheap used apparels that were seen as stifling the nascent local garment industry.

As a result, data from the Ministry of Trade and Industry indicate that the local apparel industry export defied the odds between 2018 and 2020, growing at 83 per cent in value.

AGOA comes to an end in 2025, with proposals of extension likely to be put at the table at the much anticipated US-Africa summit.

The American Apparel and Footwear Association, which represents more than 1,000 name brands, retailers and manufacturers in June last year wrote a letter and urged Congress to renew Agoa for another 10 years.

The three-day summit, happening in its second edition, is a platform to tap into Africa’s expanding integration.