The African Union (AU) is advocating for a minimum 10-year extension of the African Growth and Opportunity Act (AGOA), emphasizing the need for stability and predictability in trade relations between Africa and the United States. Speaking at a series of meetings between African trade ministers and U.S. officials, AU Trade Commissioner Albert Muchanga urged that any potential modifications to the program should be deferred for consideration in the future.
AGOA, launched in 2000, provides duty-free access to the U.S. market for qualifying African countries, facilitating exports to the world's largest consumer market. The program is scheduled to expire in September 2025, and discussions are underway regarding its renewal.
Commissioner Muchanga stressed the importance of an extension ranging from 10 to 20 years, emphasizing that this duration is crucial for the investment community and would help reduce uncertainty.
African trade ministers convened in Johannesburg to establish a unified position on the program's future, and they are scheduled to hold discussions with U.S. officials, including U.S. Trade Representative Katherine Tai.
While U.S. lawmakers and the Biden administration have expressed support for AGOA's renewal, there is an ongoing debate in Washington about potential modifications to enhance the program's impact.
Constance Hamilton, the top trade official for Africa in the Biden administration, recently suggested that Congress should explore changes to make the program more impactful. However, African governments and certain U.S. industry groups are concerned that attempting to modify AGOA during the renewal process could lead to delays in its reauthorization.
Commissioner Muchanga proposed that any enhancements or modifications to AGOA should be considered after the extension is secured.
It is worth noting that AGOA's current duty-free provisions are one-sided, with U.S. exports to African markets remaining subject to national tariffs. Some U.S. lawmakers have previously recommended making the program more reciprocal.
In addition, Muchanga clarified that U.S. exports will not receive tariff-free access to the new African Continental Free Trade Area (AfCFTA). Africa is in the process of establishing AfCFTA, which aims to create a $3.4 trillion economic bloc comprising 1.3 billion people, making it the largest free trade area since the establishment of the World Trade Organization.
The Biden administration recently announced its intention to end the participation of Gabon, Niger, Uganda, and the Central African Republic in AGOA due to governance and human rights concerns.
