Addis Ababa - US legislation granting duty-free access for imports from many sub-Saharan African nations should ensure American companies share the benefits, US Trade Representative Michael Froman said yesterday.
The US African Growth and Opportunity Act (Agoa), approved by Congress in 2000 and extended in 2004, is meant to boost economies on the poorest continent. The law eliminates import levies on products ranging from manufactured goods to textiles for about 40 sub-Saharan African nations that meet criteria including good governance and poverty reduction. The act may be renewed before it expires in 2015.
“We do not want US firms to be put at a competitive disadvantage” in Africa, Froman said in a speech handed to reporters in Addis Ababa.
The US was cognisant of the terms of free trade deals being discussed by the EU and some African nations, he said. The EU is negotiating to give preferential market access through economic partnership agreements, across most of the continent before an October 2014 deadline.
Agoa did not go far enough in helping African exporters become more competitive, President Barack Obama said last month on a three-nation African tour. The US also wanted to help African countries ease trade and investment barriers by simplifying customs procedures and improving the flow of good across borders, among other measures, he added.
US imports from sub-Saharan Africa fell 33 percent to $49.7 billion (R487bn) last year as shipments of oil, mineral fuel, precious stones and metals declined. Of that amount, $34.9m was shipped under the terms of Agoa, according to the US Department of Commerce’s website. Total two-way trade was $72.3bn, down 24 percent from 2011.
Oil remained the largest portion of Agoa imports, accounting for 86 percent of the total.
Under Agoa, the top exporters were Nigeria and Angola, the largest oil producers in Africa, followed by South Africa, Chad and Gabon, the website showed.
Agoa is being reviewed by US and African officials in Addis Ababa this week, and should be extended another 15 years to 20 years, Ethiopian Trade Minister Kebede Chane told reporters. – Bloomberg