Major Agoa review gets under way

US trade representative Michael Froman repeated President Barak Obama’s commitment to a seamless renewal of the African Growth and Opportunities Act (Agoa) beyond September 2015 when he addressed delegates at the 12th US-Sub-Saharan Africa Trade and Economic Cooperation Forum (Agoa Forum) in Ethiopia on August 12 and 13. He stressed that Agoa “remains at the heart of our strategy for increasing US-Africa trade and investment”. This was welcome news to the African government, business and civil society representatives at the forum held at the AU headquarters in Addis Ababa – who had voiced strong support for the extension of the Agoa provision for another fifteen years beyond the expiry date of September 2015. Froman also formally launched a major review of Agoa, “aimed at building on successes and addressing challenges with the US preference programme, which allows nearly all goods from 39 African countries to enter the US market duty-free”. He pointed out that it needed to be reviewed and reshaped to take account of shifts in global trade relations and a changing, growing Africa. As he had already stated at previous public meetings on Agoa: “We need to lay the foundation for Agoa 2.0, informed by the lessons of the past 13 years, reflecting the changes in the global trading system, and driven by the ideas of today and tomorrow.” At the forum he also announced what can only be considered good news for African Agoa-compliant states – that the questions the US would ask in its review of the programme were aimed at increasing African countries’ use of, and benefits from, the trade law. Froman also stressed that the US would be looking to work with African experts and leaders on forging this improved Agoa 2.0 ahead of the planned renewal. He also added that the US secretaries of commerce, energy and treasury were expected to travel to Africa in the coming months to discuss the expansion and deepening of US-African economic ties. In his video message to the 2013 Agoa Forum, Obama noted that Agoa had increased economic cooperation and trade between the US and Africa, claiming that Agoa had also helped businesses succeed and made it easier for Africa's products to reach the US. Agoa, Froman said, could act as a stepladder to Africa's further growth and development by helping the continent to fit into global value chains, increase valueadded production, and avoid bad policies and common pitfalls, such as “rigid localisation requirements that serve as barriers to trade and hinder the development of competitive industries”. Tariffs were only part of the story, Froman added, noting that there was a range of other factors that affected the ability of African firms and farms to provide goods in the quantity and quality and at a price that would make the continent competitive. “We will want to talk about why the costs of getting goods to market are higher here than anywhere else in the world and what we can do, through trade facilitation, customs harmonisation, infrastructure development and other measures to address that.” INSERT 1 Agoa could act as a stepladder to Africa's further growth and development by helping the continent to fit into global value chains. – Michael Froman INSERT 2 Fast facts The top five Africa n destinations for US products were SA, Nigeria, Equatorial Guinea, Ghana, and Angola. Top five Agoa beneficiary countries Nigeria, Angola, SA, C had, and the Republic of C ongo. Other leading Agoa bene ficiaries - Kenya, Lesotho, Gabon, Mauritius, and Cameroon.