New initiative will build on Agoa success

Is Agoa here to stay? That’s a critical question, as the bulk of African exports would be priced out of the US market without the import duty dispensation, and a large proportion of the beneficiary states in Africa are utterly economically-dependent on these Agoa exports to keep them from sinking into collapse. And the big call from the African states at the Zambia Agoa summit in June this year, was for the latest round of Agoa to be extended beyond its September 30, 2015 expiry deadline. But the question remains: Will the US Congress feel the need to extend the programme, particularly as the pressure at home to resurrect the country’s ailing economy intensifies on the Barack Obama administration? However, the good news is that the present US government wants Agoa to fly. US trade representative Ambassador Ron Kirk, leading the US Agoa delegation at the Zambian summit, was positive on Agoa’s trade statistics and optimistic about the programme’s ability to increase trade between the US and African countries in the future. He cautioned that increased market access to the US would not necessarily equate to increased trade, and that a great deal had to be done with respect to trade capacity. The ambassador announced a new Obama administration initiative to address those issues: The African Competitiveness and Trade Expansion (Acate) initiative, which will provide US$120 million over four years, is to build on the success of Africa’s regional trade hubs and help African nations realise Agoa’s full potential. US President Barack Obama, in his letter to the delegates of the 10th Agoa ministerial summit in Lusaka, which was read to the delegates by Kirk, said “the time is ripe for African economies to grow by taking advantage of Agoa”. And Kirk added, Obama had said that, with an extension of Agoa to 2025, he was optimistic that many of the African economies would grow stronger. But this doesn’t mean that Agoa is definitely going to be extended to 2025, according to Elizabeth Trudeau, of the economics division at the US embassy in Pretoria. “The Obama administration has given support for an extension of Agoa,” she told FTW, “but it must still get congress approval, because it is only a congressional act that can renew Agoa.”