Did AGOA die quietly this week, or is there a chance that America’s trade deal with Africa countries might be revived in altered form?
Officially, 25 years of preferential access to the United States markets ended on 30 September. The US legislation known as the Africa Growth and Opportunitiy Act (AGOA) came into effect in 2000 and was last renewed in 2015. A further renewal, planned for this month, has been allowed to lapse by the Trump administration.
Nevertheless, there’s hope in some African capitals that all is not lost. Lesotho is convinced that an extension is coming, others see the possibility of a new Africa deal with America.
After meeting US trade officials from both houses of Congress, Lesotho’s trade minister Mokhethi Shelile was decidedly optimistic, BusinessTech reported.
“They all agreed that AGOA has to be extended and they promised us that by November or December [at] the latest, it will be extended by a year,” Shelile said. South Africa’s trade minister, Parks Tau, told Bloomberg Television that South Africa had not given up on an Agoa renewal.
“We continue to lobby, both in the administration and in Congress. And we’re getting some sentiment that it would be ideal if it was extended. So, we have to continue to work hard,” Tau said. His comments came after a meeting with US trade representative Jamieson Greer, who is on record as saying that AGOA renewal is not a priority for the Trump administration.
The Daily Maverick said London’s Financial Times had reported that President Trump’s senior adviser for Africa, Massad Boulos, had signalled his support for renewing the trade pact for one year. Boulous said the US had some issues with AGOA “but the overall objectives we agree with,” News24 reported.
While there is no clarity about what might happen, and when, there is one certainty – the final decision on whether AGOA lives or dies rests with President Trump.
Even if AGOA is revived, it is difficult to see a return to the duty-free imports that brought so much benefit to South African producers of luxury vehicles, wine, nuts and citrus.
Tariffs of 30% are now in effect. Even if they are reduced to 15%, that could price these products out of the US market. And the US trade view is now “transactional” and “reciprocal” – no benefits without a counter benefit for America.
In South Africa’s case, this means sacrificing the country’s poultry industry so that other industries can gain. There may be other sacrifices if a “deal” for lower tariffs is done.
