The African Growth & Opportunity Act (AGOA) is a U.S. non-reciprocal tariff-preference trade scheme covering the Sub-Saharan Africa (SSA) which was signed into law on May 18, 2000. The non-reciprocal trade preference system renders duty and quota free access to the US market to eligible countries.
AGOA, built on the General System of Preferences (GSP), renders duty and quota free access to the US market for qualifying firms, giving GSP status to an additional 1,800 product lines, to a total of 6,400+ (added line items include footwear, luggage, handbags, watches, flatware, certain automotive components).
Note that, following the expiry of current GSP program, AGOA eligible countries can still export products listed on the GSP/AGOA list duty free.
Currently 37 countries are AGOA eligible. A country such as South Africa, although AGOA eligible, is not eligible for third country fabric provision since it is not considered a least developed country. Some countries have lost/regained their eligibility status.
AGOA is not a reciprocal bilateral trade agreement such as the EU EPA.
AGOA is not a developmental or a capacity building program providing funding. But it provides firms from eligible countries to competitively export to the U.S. market.
NB: Suspension from AGOA eligibility is not a sanction, but a legislative requirement.
The AGOA act has undergone several amendments since 2000, resulting in certain expiry dates extended. For example the in 2002 the apparel special provisions was extended from 2004 to 2007, and in 2006, the 3rd country fabric provision was extended by a further 5yrs from Sept2007-Sept2012 to allow LDCs (in Sub-Saharan Africa) to export certain textile articles under AGOA.
The third country fabric provision expires in September 2012 and AGOA in 2015. No one knows with certainty what is going to happen beyond 2015 when the current AGOA expires. However, lobbyists are busy pitching for an extension.
In terms of AGOA, SATH is focusing on promoting specialty food products as well as textiles/apparel from the eligible Southern Africa Development Community (SADC) region.
SATH's approach includes:
- Collaborating with regional and national organized institutions e.g chambers, industry associations
- Identifying and addressing problem areas that have regional focus and impact
- Giving international exposure to eligible firms e.g. via participating in sector specific trade events in the US or in the region
- Providing forum for networking an information sharing- via workshops, newsclips, newsletter, etc
- Identifying export opportunities
- Improving firm export readiness, via working with experts and meeting international standards
- Promoting investment opportunities and transfer of technology, via our U.S based office
- Working with relevant government departments on promoting AGOA and inclusion of AGOA in government strategies
- Having national AGOA working groups and dedicated AGAO information centres
Our Coverage: SADC
Angola, Botswana, Lesotho, Malawi, (Mauritius*), Mozambique, Namibia, South Africa, Swaziland, (Tanzania*), Zambia
*Indicates shared responsibility with the East African Hub and thus reduced SATH activity