Botswana companies have failed to take full advantage of AGOA because of lack of raw materials and complications arising from US rules of origin despite of that according to the statistics from US Department of Commerce, Botswana exports to US under the African Growth Opportunity Act (AGOA) increased by 53 percent from $5.5 million (P52 million) to $8.5 million (P80 million) in the first 11 months (Jan-Nov) of the year, mainly on the back of increase in textile and apparel.
While Botswana is empowered to export 6,500 products under AGOA, textiles have benefited the most, being easy to establish with a relatively low cost of labour.
USAID Southern Africa Trade Hub, Trade and Investment Specialist, Cosmas Mamhunze said that Botswana’s textile exports in the nine months to September amounted to $7.4 million constituting 87 percent of total AGOA eligible exports.
In the period, Botswana was the seventh largest textile exporter to the US under AGOA in sub-Saharan Africa.
Mamhunze said that textiles/apparel exports under AGOA constitute 87 percent of the total exports from Botswana in 2014, even though the total exports are up to November 2014 yet textile/apparel figures are up to September 2014.
In the first three quarters of 2014, the top-rated African textile exporter was Kenya with exports valued at more than $283 million, followed by Lesotho at $226.4 million with Mauritius in third place at $162 million worth of exports.
AGOA was signed into law in May 2000 and it offers tangible incentives for African countries to benefit from opportunities in the US market to continue their efforts to open their economies and build free markets.
The only Botswana textile firm exporting under AGOA is Carapparel that manufactures knitted and woven garments for men, women and children for local consumption and export to USA market. The rest of the textile exporters are servicing the South African market as studies have also revealed that Botswana companies have limited production capacities and have not adequately diversified their products.
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