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America to consider Zimbabwe’s eligibility for Agoa this year

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America to consider Zimbabwe’s eligibility for Agoa this year

13th February 2018

By: Terence Creamer
Creamer Media Editor

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The US government will consider Zimbabwe’s eligibility for the trade benefits it extends under the Africa Growth and Opportunity Act (Agoa) during 2018, the State Department’s acting director for economic and regional affairs Harry Sullivan said during a telephonic briefing on Tuesday.

Since Agoa came into force in 2001, Zimbabwe has never been eligible for the market access offered under the legislation, which has been extended to 2025.

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The US determines whether countries in Sub-Saharan Africa meet its published eligibility requirements on a yearly basis and beneficiary status can be granted, or withdrawn, at the discretion of the US President.

Currently, 38 African countries are eligible for Agoa, which extends duty-free access to the US market across 6 000 tariff lines.

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In response to a question posed about Zimbabwe’s future eligibility in light of recent political developments, Sullivan said the US was monitoring developments and would consider Zimbabwe’s eligibility during 2018.

President Robert Mugabe resigned on November 21, 2017, after 37 years in power and President Emmerson Mnangagwa assumed office on November 24. Mnangagwa has subsequently promised that Zimbabwe will hold free and fair elections by July and has also proclaimed Zimbabwe to be open for business.

Sullivan indicated that interagency eligibility reviews were conducted in Washington, DC, yearly and that, following the 2017 review, the Gambia and Swaziland became eligible to rejoin Agoa during 2018.

Zimbabwe’s eligibility would be up for discussion when the group met again in the middle of 2018. “The situation is still new, but we are very optimistic, along with the Zimbabwean people, that change will continue to be positive and it's a situation that we are monitoring,” Sullivan said.

He also reported that non-oil exports to the US from Africa, most of which was conducted under Agoa, had increase from $1.3-billion in 2001 to $4.2-billion in 2015.

The overall trade trend was also positive, with US-Africa trade rising by 15.8% in 2017, from $33-billion to $38.5-billion. US exports to Africa rose 4% to $13.1-billion and African exports to the US rose by more than 20% to over $24-billion.

Increased oil exports, which are not covered by Agoa, accounted for a large share of the increase, but Sullivan said there were also some “encouraging signs of diversification”.

For instance, African exports of agricultural products increased by 10% to $2.7-billion and an increasing number of countries took advantage of the benefits available under the legislation.

Between 2016 and 2017, Ghana saw its exports under Agoa quadruple to more than $300-million, while Madagascar and Ethiopia took greater advantage of the market access granted for footwear and garments, with the two countries’ exports to the US rising to $152-million and $92-million respectively.

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