U.S. Congress renews AGOA for another 10 years will boost US-Africa trade

YarnsandFibers News Bureau 2015-06-26 13:00:00 – USA

The African Growth and Opportunity Act (AGOA), a 15 year old law which had been due to expire at the end of September, allows sub-Saharan African nations duty-free access to U.S. markets for certain goods such as textiles has been renewed by the U.S. Congress. This makes Africa the latest continent wrapped up in a spree of trade legislation clearing through Congress.

Congress cleared the legislation a day after it gave President Barack Obama “fast-track” trade authority to put trade deals, such as the impending Trans-Pacific Partnership, before Congress for an up-or-down vote.

While the fight over the workers-aid program, Trade Adjustment Assistance, stole the spotlight, the measure is also designed to help another set of factory workers hard-hit by Asia’s rise: Africans.

AGOA has had a considerable impact on sub-Saharan Africa’s clothing industry and is a key part of the reason that textile plants have popped up across the region. It also explains why the trousers Americans buy at Walmart WMT -0.72% are increasingly from countries such as Ghana.

Lately, though, the law hasn’t encouraged much investment. African industrialists like Chid Liberty, who owns a T-shirt factory in Liberia, have had to worry that a gridlocked Congress would let the bill expire this September. (Recently, Liberty has also had to deal with unfounded fears that Ebola could spread through clothing shipments.)

Liberty also worries that the Trans Pacific Partnership is likely to extend many of the same benefits to Africa’s competitors in Asia, where the cost of electricity, shipping, and business are generally much less.

U.S. Congress has renewed the law for another 10 years. The final step is for President Obama to sign it.

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