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Fresh bid to extend Agoa preferential trade terms

By | May 20th 2011 at 00:00:00 GMT +0300

 By LUKE ANAMI

The US Government is considering extending the Apparel trade preferential provisions under the African Growth and Opportunity Act (AGOA) to 2015 after the expiry of the trade terms.

According to the Ms Constance Hamilton, the US Trade official said negotiations are ongoing with Congressmen keen to see whether the provision can be extended beyond September 2012.

AGOA provides reforming African countries with the most liberal access to the lucrative US market, an offer that is available to countries or region with which the United States does not have a Free Trade Agreement.

Under the Act, tangible incentives are offered to encourage African countries open their economies.

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In a tele-video conference held at the US Embassy in Nairobi on Tuesday, Ms Hamilton, who is the Deputy Assistant United States Trade Representative for Africa said there is a desire to extend the apparel provision to 2015.

She, however, reckons that a decision is yet to be made on the proposal. "We intend to extend it only during the lifetime of AGOA when it expires in 2015. But it is only a conversation we intend to have with Congress," explained Ms Hamilton.

Despite discussions to extend it, Ms Hamilton challenged African countries including Kenya to consider the wide range of trade incentives on offer under AGOA that covers 7,000 products instead of concentrating on apparel and textile exports.

"Yes Apparel is important, but we also do urge them to move away from this product as there are many other products that we should be able to take advantage of," she explained.

To export apparel and certain textile to the US under the AGOA duty free provision, the Act’s provision permits lesser-developed countries to use foreign fabric for their garment exports.

This was supposed to expire in 2007, however, the US Congress passed legislation in December 2006 that extended it to September 2012.

EXPORT PROCESSING

Therefore, the third-country fabric provision must be renewed before the end of 2011 to prevent the collapse of the AGOA apparel section; an issue Kenya’s Export Processing Zones Authority has raised concern over.

Ms Hamilton further revealed that discussions to have the AGOA duty free offer be extended beyond its deadline (2015) are also being discussed.

"We are in the process of meeting with Congressmen who are interested in AGOA. We are in consultation on what will happen next, but there is no definite answer as to whether it will be extended."

On June 9-10, 2011, Zambia will host the 2011 African Growth and Opportunity Act (AGOA) Forum, a crucial meeting that will deliberate on US government’s trade policy with sub-Saharan Africa.

The 2011 Forum’s theme is Enhanced Trade through Increased Competitiveness, Value Addition and Deeper Regional Integration.

The forum will bring together Government officials, business leaders and civil societies.


Agoa African Growth and Opportunity Act United States
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