South Africa urges lengthy extension of US duty-free African Growth and Opportunity Act

By Hassan Isilow

South Africa said Friday it wants the US to extend the African Growth and Opportunity Act (AGOA) which gives several African nations duty-free access to American markets.

“We would like you to look at the extension or renewal of AGOA for a sufficiently lengthy period for it to act as an incentive for investors to build new factories on the African continent,” President Cyril Ramaphosa said at the opening a three-day meeting of the AGOA trade forum in Johannesburg.

Ramaphosa said AGOA has served as the cornerstone of the US-Africa commercial relationship for more than two decades but he wants the legislation that expires in 2025 to be extended for longer because short extensions impede investment ambitions.

He also said while the legislation’s unilateral trade preferences have provided economic benefits for countries across sub-Saharan Africa, AGOA, as a whole, remains underutilized.

“The legislation has helped to promote manufactured exports into the United States, but so much more can be done,” he said.

The sub-Saharan countries that qualify for AGOA have to meet certain criteria such as maintaining human rights, respecting core labor standards and eliminating barriers to US trade and investment, among other requirements.

The US announced earlier this week it intends to eliminate Uganda, Niger, Gabo, and the Central African Republic from AGOA for failing to uphold the eligibility criteria.

Trade ministers from across Africa and US officials are currently discussing ways of improving trade matters on both sides of the Atlantic.

AGOA is a special US legislation signed in 2000 that grants duty-free access to nearly 40 sub-Saharan African nations to US markets.