U.S. Trade Representative Katherine Tai emphasized the need for a "more useful and effective" trade programme with Africa during talks in South Africa over the future of the African Growth and Opportunity Act (AGOA). AGOA, which grants qualifying African countries duty-free access to the U.S. market, is set to expire in September 2025, with discussions focused on its renewal and possible reform.
Tai, who recently met with African trade ministers to discuss AGOA's future and a potential third reauthorization, expressed a desire to make the programme more than just symbolic. While over $10 billion worth of African exports entered the U.S. duty-free under AGOA last year, the program has faced challenges in fully realizing its potential since its launch in 2000.
Although AGOA has received bipartisan support from U.S. lawmakers, divisions exist in Washington regarding the need for updates. African nations are advocating for an early 10-year extension to avoid potential delays in Congress. They believe improvements can be made after reauthorization.
However, the Biden administration is seeking changes as part of the renewal process. Tai explained that enhancing AGOA might require statutory adjustments. A revised AGOA should aim to improve utilization by qualifying countries, consider the African Continental Free Trade Area's recent creation, ensure benefits for growing economies, and promote small business participation.
U.S. business associations emphasize the need for certainty around AGOA, especially as companies worldwide seek to reduce their reliance on Chinese manufacturing. An early reauthorization could encourage businesses to resume investments that have been paused due to uncertainty.
While there is congressional support for a quick AGOA renewal, political gridlock in recent months has raised concerns about the program's inclusion on the Congressional agenda.
