SABC News - African exports under AGOA have reduced significantly: Report:Wednesday 6 July 2016

African exports under AGOA have reduced significantly: Report

Wednesday 6 July 2016 16:29

Amina Accram

Since 2000, trade relations between sub-Saharan Africa and the United States has largely been dominated by AGOA.

Since 2000, trade relations between sub-Saharan Africa and the United States has largely been dominated by AGOA.(SABC)

African exports under African Growth and Opportunity Act (AGOA) have reduced significantly since 2008, totalling $9.3 billion in 2016 from $66.3 billion in 2008.

A report presented this week by the United States Trade representative to congress on AGOA has reported that the decline in trade is a as a result of reduced oil exports from the US.

The report however shows that non-oil exports from Africa to the US have increased from $1.4 billion in 2001 to $4.1 billion last year.  

Since 2000, trade relations between sub-Saharan Africa and the United States has largely been dominated by AGOA.

But trade has been declining between the US and Africa under the agreement.

Cyril Prinsloo is researcher of economic diplomacy at the South African Institute of International Affairs,"Between 2000 and 2008 there was a significant increase in exports from Africa to the US from 2008 towards 2016 there was a significant drop and this was largely due to slowdown in demand for oil from US consumers."

"Even though oil exports have declined significantly over the lifespan of AGOA, that is a decade and a half the continent has managed to increase its non- oil exports to the United States."

The report raises concerns about the future of Sub Saharan African trade relations with the US after the current AGOA extension ends in 2025.

The US has indicated an interest in more formalised trade arrangements with African countries.

Prinsloo says Africa should aim for better trade benefits with the US under the current AGOA act.

"Its little less than nine years from now when AGOA is likely to expire. So the first thing to actually leverage the US act, African countries should take the most benefit from this act."

US trade representatives are urging beneficiaries of AGOA to begin setting their sights on a future that goes beyond AGOA.

Only Kenya and Mauritius have thus far officially indicated their interest in a more formalised trade arrangement with the United States.

South Africa has meanwhile resolved all issues relating to guaranteeing its access to AGOA until 2025 .

"Any formalised trade arrangement needs to be met by the needs and wants of the business community, these are the ones that take advantage of any formalised trade arrangements," adds Prinsloo.


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