How a dead US trade deal is pushing Africa further into China’s orbit
Lapse of African Growth and Opportunity Act deals tariff blow to continent and ‘creates fertile ground’ for Beijing to expand its clout
The Clinton-era African Growth and Opportunity Act (AGOA) expired on September 30 after Congress failed to pass a renewal bill, leaving more than 6,000 African exports, such as apparel and textiles, subject to higher US tariffs.
The resulting economic uncertainty for businesses is expected to take a toll on countries such as Kenya, South Africa, Lesotho and Madagascar – whose textile and apparel industries rely heavily on the US market.
Under AGOA, Kenya has been able to produce clothing for major US brands such as Levi’s and Wrangler, allowing the East African country to compete more effectively with Asian exporters like Bangladesh and Vietnam. For the tiny southern African nation of Lesotho, 45 per cent of exports go to the US, with garments making 80 per cent of the shipments.
A White House official has reportedly confirmed that the Trump administration supported a one-year extension. However, it is not clear how this would be feasible – no formal legislation has been introduced and a floor vote has not been scheduled to prevent the act from expiring.