After 25 years, US-Africa trade lifeline AGOA comes to an end
African Growth and Opportunity Act (AGOA) Expiration
African Growth and Opportunity Act (AGOA) Expiration
The African Growth and Opportunity Act (AGOA) expired on Tue, Oct 3, 2023, ending a 25-year agreement that provided duty-free access for thousands of African products to the U.S. market. Since its inception in 2000, AGOA has been instrumental in facilitating trade between the United States and African nations.
In Kenya, the AGOA framework significantly bolstered the textile and apparel sector, enabling competition with Asian exporters. Exports from Kenya to the U.S. grew from approximately $50 million to around $500 million during AGOA's tenure.
Concerns have been raised about the future viability of the sector without AGOA. Pankaj Bedi, CEO of United Aryan clothing factory in Kenya, highlighted the challenges facing the industry in competing with Asian markets. The expiration is also expected to impact employment, with more than 66,000 Kenyans, predominantly women, previously employed in the sector.
Since its inception in 2000, AGOA has been instrumental in facilitating trade between the United States and African nations.
Job reductions have already commenced, particularly in Nairobi's garment districts, where employees face uncertain futures.
AGOA's expiration removes protections from tariffs previously imposed by the U.S., which can reach up to 10% or higher. This change introduces potential challenges for several African economies dependent on U.S. exports.
At the United Nations General Assembly, Kenyan President William Ruto advocated for a five-year extension of AGOA. Meanwhile, a White House official indicated support for a one-year extension of the agreement.
Experts suggest that the immediate impact may be manageable, but long-term effects could be significant, with potential spillovers into broader economic challenges.
Based on reporting by Africanews.
