The African diplomatic corps officially presented recommendations for the reauthorization of the African Growth and Opportunity Act (AGOA) to members of the U.S. House Subcommittee on Africa, Global Health, Global Human Rights and International Organizations.
“In the reauthorization process for AGOA, we want to make some improvements so that a successful program can extend more benefits to an even broader number of businesses,” said U.S. Rep. Chris Smith, Chairman of the subcommittee. Smith told a gathering of over 50, including diplomats, staff and others interested in AGOA, that his own bill, H.R. 1777, the Increasing American Jobs Through Greater Exports to Africa Act, would be “complementary” legislation to AGOA and noted it would “build support for African exports to the United States by making U.S.-Africa trade more of a two-way street.
“We need to find a way to provide capacity building for African and American businesses so they can better identify partners and be more efficient in their joint ventures,” Smith said. “We need to raise the level of U.S.-Africa agriculture trade.”
AGOA was signed into law in 2000 for an original period of eight years, and later extended through 2015. AGOA is a U.S. trade law with the specific goals of enhancing U.S.-African trade for qualifying Sub-Saharan African (SSA) countries, and encourages SSA Governments to open their economies and build free markets.
The diplomatic corps report was presented by the co-chairs of the African diplomats’ working group on AGOA: Mauritius Ambassador Somduth Soborun and Ethiopia Ambassador Girma Birru Geda. It is estimated that AGOA has generated about 350,000 direct jobs and 1,000,000 indirect jobs in Sub-Saharan Africa, and about 100,000 jobs in the United States, they said.
“Since AGOA was passed in 2000, we have seen significant progress in the volume of trade between Sub-Saharan Africa and the United States,” said Soborun.“U.S.-African trade stood at $29.4 billion in the year 2000, trade with Africa made up 1.5 percent of total U.S. global trade, and Africa’s share had grown to 2.6 percent by 2011. U.S.-Africa trade peaked in 2008 at $104.7 billion.”
Ambassador Geda noted the “stability and peace that has been created” by AGOA helping advance a healthy and growing economic climate across a continent facing many challenges.
The Africa diplomatic corps report centered around six key recommendations:
- Enhanced Political Dialogue: “In order for AGOA to have a large and lasting impact on the region, there should be greater political dialogue on pertinent issues at the local, regional, national, and international levels. For example, the Working Group proposes a Summit-level meeting during the 13th AGOA Forum Washington, DC in 2014, along with follow-up meetings to be held every two years.”
- Re-authorize AGOA for at Least 15 Years: “The Working Group strongly advocates that AGOA be ring-fenced and reauthorized in the 113th Congress for a significant enough period of time (15-20 years) to inspire investor confidence and allow opportunities to take root and grow.”
- Capacity Building to Generate Increased Private Sector Engagement: “AGOA has successfully increased state-to-state interactions, but greater dialogue with the private sector and increased business-to-business collaboration are needed. Through outreach, analysis, and ongoing processes to better engage the private sector, increased public-private dialogue around AGOA could help realize the program’s potential.”
- Increased Trade and Market Access: “All eligible AGOA countries should develop and implement a national investment and export strategy, which has proven successful for numerous countries in the region. In addition, U.S. trade preferences, especially in important sectors like textiles and apparel, should be maintained and expanded to insure that African products remain competitive.”
- Encourage U.S. Investment in Africa: “At present, U.S. investment in Africa accounts for less than one percent of U.S. investment worldwide. Public-private partnerships (PPPs) provide one opportunity to generate additional investment and engage U.S. companies in the new opportunities in the African market.”
- Address Accompanying Measures Separately: “The Working Group acknowledges related proposals in support of economic growth and development in Sub-Saharan Africa, specifically Economic Partnership Agreements (EPAs) and Free Trade Agreements (FTAs). However, immediate focus should be dedicated to reauthorization of AGOA.”