AGOA fuels US-Africa trade growth over 500% in ten years – Expert

… but many African nations miss out on the five-fold growth

Trade between the United States and Africa is said to have grown five-fold from 2001 to 2011.

The growth was fueled by the implementation of the African Growth and Opportunity Act (AGOA), a measure designed to provide incentives for US-Africa trade.

Since the act came into operation in 2001, AGOA-related non-oil exports from Africa have grown five-fold to $53.8 billion from $8.1 billion over ten years.

Despite the over 500 percent growth in trade between the two, a leading Washington-based expert has said many African countries missed out on that five-fold growth.

Sherman E. Katz, a senior advisor at the Centre for the Study of Presidency and Congress in Washington DC, made these known when he gave a talk entitled “US Trade Policy under the New Administration: What Does it Mean for Africa?” at an African Development Bank (AfDB) Staff seminar in Tunis late February 21, 2013.

Statistics show that many African countries are not benefitting from the opportunities created by AGOA as US-Africa trade remains dominated by a small group of sub-Saharan countries, according to Katz’s presentation.

The presentation noted that all exports from sub-Saharan Africa to the US in 2011 totalled $79 billion, of which almost 80% came from just three countries – Nigeria (47%), Angola (19%) and South Africa (13%).

US exports were similarly concentrated, with those same three countries receiving 68% of the 2011 total of $20.3 billion – South Africa (34%), Nigeria (22%) and Angola (12%), it added.

To improve the situation, Katz emphasized the need for African countries’ active involvement in making their requirements and trade positions known to the US Congress at the negotiation stage ahead of the 2015 AGOA renewal.

According to the AfDB, Katz’s presentation suggested that African countries need to focus on meeting AGOA export requirements to increase their utilization of the AGOA quota.

He advised that Africa needs more skilled personnel, better infrastructure, capital, transparency, and rule of law to better utilize AGOA.

By Ekow Quandzie