Very few South African consumers have heard of AGOA, beyond perhaps a vague reference on the news. Most people – if they think of them at all -consider international trade as obscure contracts with no real impact on their lives.
But international trade – and particularly AGOA – has a huge impact on daily life in South Africa. In our explainer, we describe why AGOA is important to us.
What is AGOA?
The Africa Growth and Opportunity Act (AGOA) was signed into law in 2000 by then-US President Bill Clinton. It was intended to give African countries better access to a vast American consumer base by removing any import duties on African products.
The agreement covers more than 5 000 products under its Generalised System of Preferences (GSP) and includes 36 countries.
It expires on September 30th , 2025. This deadline has spurred US policy-makers to consider if or how it can be extended.
AGOA Membership is Conditional
AGOA membership is conditional on a number of factors, including a commitment to democracy and good governance. It also requires that member countries do not oppose American foreign policy.
This has made AGOA controversial in some African countries, which see the agreement as a ‘neo-colonial’ attempt to meddle in a country’s internal affairs. AGOA has also had mixed results, with some countries seeing direct benefits while others have not.
Nigeria I the largest exporters (mostly oil and steel), while South Africa is the most diverse. Nigeria is the largest exporters (mostly oil and steel), while South Africa, the second largest,is the most diverse. Agricultural products have the greatest export potential but African countries seldom meet the US’s stringent sanitary standards.