TRALAC - Trade Law Centre

AGOA's Term to Be Extended

Statement by Robert B. Zoellick US Trade Representative June 25, 2004, regarding the Congressional passage of legislation extending the African Growth and Opportunity Act (AGOA) late Thursday.

Late last night, the Senate unanimously approved legislation extending the African Growth and Opportunity Act (AGOA) -- an important trade preference program designed to help sub-Saharan Africa develop and grow economically.

The House of Representatives passed identical legislation earlier this month.

The AGOA Acceleration Act of 2004 fulfills President Bush's promise to extend the benefits of AGOA for the people of Africa. It is the latest step in a continuing bipartisan effort to build and improve on the success of this extraordinary initiative.

I want to thank the House and the Senate for their support for Africa and their approval of AGOA, particularly the strong leadership and commitment of Senate Majority Leader Bill Frist, Senate Minority Leader Tom Daschle, Senate Finance Committee Chairman Chuck Grassley, Senator Max Baucus, House Ways and Means Chairman Bill Thomas, and Congressman Charlie Rangel. I am very appreciative of their effort to secure approval of this legislation despite the many other demands on their time.

Passed in 2000, AGOA forged a new trade partnership between the United States and sub-Saharan Africa -- granting duty-free access to the U.S. market for substantially all products of eligible countries and bringing new jobs and new investment to the region.

AGOA has created new commercial opportunities for Africans. Last year alone, non-fuel exports to the United States from eligible countries were up by more than 30 percent over 2002.

"And a more prosperous Africa is also benefiting American companies, farmers and workers. Between 1999 and 2003, U.S. exports to the region have grown by 24 percent to $6.9 billion.

President Bush has made AGOA a cornerstone of the Administration's policy toward Africa and a key part of his effort to open markets and to promote economic growth and development in struggling areas of the world.

I also want to thank the African Trade Ministers and the African Ambassadors in Washington -- who made trips to Washington to stress the importance of this measure and worked tirelessly on the ground to see it through - and the U.S. and African private sector, including the AGOA coalition of businesses, NGO's faith based organization, which seized the opportunity of AGOA, invested in the Africa's future and made this program a success."

TRADE FACTS

Trade with Sub-Saharan Africa: AGOA Is The Cornerstone of Success

The African Growth and Opportunity Act (AGOA) is the cornerstone of the Bush Administration's trade and investment policy toward sub-Saharan Africa, which is promoting free markets, expanding U.S.-African trade and investment, stimulating economic growth, and facilitating sub-Saharan Africa's integration into the global economy.

As a result of AGOA, substantially all imports from sub-Saharan Africa are eligible to enter the United States duty-free. In 2003, over 95 percent of U.S. imports from AGOA-eligible countries entered duty-free.

The United States is sub-Saharan Africa's largest single-country export market, accounting for 20 percent of the region's total exports in 2002.

AGOA has helped to bolster U.S.-sub-Saharan trade and investment. Total trade between the U.S. and sub-Saharan Africa was just under $33 billion in 2003, with U.S. exports of almost $7 billion and imports of $25.6 billion.

U.S. imports under AGOA were valued at just over $14 billion in 2003, a 55 percent increase from 2002. The U.S. direct investment position in sub-Saharan Africa increased 12 percent at year-end 2002, to $8.9 billion.

Thirty-seven of the 48 sub-Saharan African countries are now eligible for AGOA. On December 31, 2003, Angola was added to the list of eligible countries, and two countries-Central African Republic and Eritrea-were removed from the list for failing to meet the eligibility criteria.

As of April 2004, 24 countries were eligible to receive AGOA's apparel benefits. Eight countries have qualified for AGOA's special handloomed and handmade provisions.

The United States devoted $133 million to trade capacity building activities in sub-Saharan Africa in FY2003, up 26 percent from the previous fiscal year. More than a dozen U.S. agencies implemented these activities.