Sub-Saharan Africa’s Agoa growth disappoints

THE GROWTH of 25% in Africa’s exports to the US under the African Growth and Opportunity Act (Agoa) duty-free trade agreement in the first quarter of this year does not reflect so favourably on the sub-Saharan region of the continent, according to Eckart Naumann, a Trade Law Centre (tralac) associate. “With the 2006 Agoa Forum to be held in Washington DC less than two weeks away,” he said, “it is an opportune time to reflect on Africa’s, and particularly southern Africa’s, recent trade performance under Agoa.” At first glance, Africa’s exports to the US increased by just under 25% year-on-year in US dollar terms, on the back of an increase in overall exports of a similar magnitude. “But over the same period,” said Naumann, “those of the SA Customs Union (SACU) have declined by 12%, while the Southern African Development Community (SADC) increase of 20% also becomes a decline of 12% when discounting the massive contribution of Angola’s oil exports.” However, in the midst of these sobering statistics, Neumann still suggests that Agoa’s margins of preference and favourable rules of origin continue to play a vital role in the manufacturing (and export) success of various regional economies. Garment sector “The oft-quoted example of Lesotho’s garment sector is a case in point,” he said, “although others have similarly recorded significant success with Agoa, including Swaziland, Madagascar, Mauritius and SA.” He feels that there is little doubt that these and other issues will be highlighted at the upcoming high-level discussions at ministerial level - as well as in the private sector and civil society workshops that will take place concurrently at the Agoa Forum. “This raises the following questions,” Neumann said. “Wherein lies the success (and failure) of Agoa? And what legislative amendments to the act - if any - would further enhance market access for African exporters?