TRALAC - Trade Law Centre

SA ambassador to US Ebrahim Rasool welcomes AGOA extension

Saturday, 04 August 2012

Source: Business Day (South Africa)

South Africa’s ambassador to the US, Ebrahim Rasool , has welcomed the extension of the Africa Growth and Opportunity Act (Agoa) for another three years.

Mr Rasool told a summit in Pretoria that Agoa was balanced and significantly beneficial to both parties.

Trade and Industry Minister Rob Davies urged US companies to consider more long-term and strategic investment in Africa.

Mr Rasool said: "We are beginning to understand that the Agoa is not a one-way exercise of US kindness towards South Africa and Africa. It’s a two-way street, a win-win situation."

The Agoa arrangement, first passed by the US Congress in 2000, allows eligible countries in sub-Saharan Africa to export their goods into the US without paying import duties.

The legislation approved on Thursday extends the Agoa arrangement to 2015 and makes provision for Africa’s newest country, South Sudan.

The US Congress voted on Thursday to renew the trade arrangement, a move largely seen as major security for millions of jobs in Africa’s clothing sector.

Mr Rasool said campaigns were already in place to lobby for the extension and broadening of goods included in the preferential trade pact beyond October 2015.

"We export more than $8bn worth of goods to the US through Agoa. If we are to wake up on October 1 without this provision, I don’t have to tell you what your situation would be," he said.

"Whether you are in automotive, agriculture or any other sector, I think the consequences for your companies and our country will be enormously unfavourable."

Mr Rasool said for the law to be passed on Thursday, South Africa had made significant sacrifices on behalf of its African counterparts. "South Africa forfeited its application to join the Third-Country Fabric (Provision) so that other African countries could have an easy passage. Otherwise this thing would have been extensively delayed," he said.

"There is a feeling that South Africa, having joined the Brics (Brazil, Russia, India, China and South Africa), is in another league and does not qualify for some of these benefits."

In a brief appearance at the summit, US ambassador to South Africa Donald Gips said Agoa had become significant both for his country and Africa’s economies.

He said African countries, combined, had exported $53bn (about R438bn) worth of merchandise into the US without paying import duty.

Last year, SA exported vehicles worth more than $2bn, he said.

Mr Davies said in an interview after his address at summit that US companies needed to take account of Africa’s rising status as the "next growth frontier".

More than 600 US companies invest in South Africa.

"From South Africa’s point of view, we would like to see a roll-over of Agoa from its current form. We are urging South African stakeholders to get involved in the debate," Mr Davies said.

"Trade with the US has been growing and recovering since the recession. We have diversified the products we export to the US."

He described to the current level of industrialisation on the continent as low, and reiterated his call for more investment in infrastructure development, which he said would put the continent on a better footing when investors choose investment destinations.

"I think if you listen to African leaders you’ll hear many of them saying that the next phase of African growth must ensure much broader industrialisation."





“ Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of South Africa's bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.