The Africa Growth and Opportunity Act expired on September 30, despite numerous efforts to continue the program that for 25 years has enabled sub-Saharan African businesses to export their products to the United States duty-free. The chief culprit, it appears evident, is the petty politics largely designed to prevent the Trump Administration from functioning.
Congress once again appears more interested in the clown show than actual work, despite putting on a false front of eagerness to enable struggling African entrepreneurs to stay in business.
Consider that the House Ways and Means Committee and the Senate Finance Committee have both held hearings. Members of both parties have introduced legislation to reauthorize the program, which key House Democrats have called “the centerpiece of U.S. trade relations.” Participating African nations, key stakeholders, and the private sector, too, pushed for AGOA reauthorization before its September 30 expiration date – to no avail.
While the Trump Administration did impose tariffs that in many cases eroded the AGOA advantages and may exclude the Republic of South Africa from any AGOA reauthorization, President Trump has expressed a desire to extend AGOA at least for another year – while leaving modest tariffs in place for most affected countries.
Louisiana Republican Sen. John Kennedy in September 2023 had floated a bill to extend AGOA, stating that the law that has been the cornerstone of economic ties between the U.S. and African nations should “over the next two decades … play a pivotal role in helping Americans deter China’s growing influence throughout the region.”
Kennedy, who reintroduced an AGOA reauthorization bill for another twenty years in late September, must still be scratching his head as to why his 2023 legislation went nowhere. He noted the widespread bipartisan support for AGOA as a major hedge against Chinese hegemony and would (as he said in 2023), “allow the U.S. to keep working closely with African nations to grow our economies, reduce poverty, and ensure that American values prevail in the region.”
Congress enacted the African Growth and Opportunity Act in 2000 and extended it for 10 years in 2015. The program encourages sub-Saharan African countries to adopt market-based economies, support democracy, and protect due process and the rule of law. In turn, the 32 AGOA-eligible countries received duty-free access to thousands of products in the U.S. market.
While the program supports nearly 120,000 jobs in the United States, according to Sen. Kennedy, it has also been a godsend for many African entrepreneurs and wage earners alike, notably in nations like Kenya and Lesotho. With AGOA, the Trump tariffs were 10% for Kenya and 15% for Lesotho; without AGOA, those tariffs jump to 28% and 32%, respectively, with similar increases for other nations.
A recent BBC article says AGOA has proved very valuable for thousands of workers across the African continent – and that its demise will have severe detrimental impacts. Everybody knows this – and just about everybody agrees that it ought to be extended.
The BBC article highlights a Kenyan textile firm Shona EPZ, focusing on a seamstress who wonders “If AGOA expires, where shall we go?” Her regular wage brings dignity and the ability to pay school fees for her children, keep food on the table, and envision a brighter tomorrow.
Kenya in 2024 alone exported $470 million worth of clothing to the U.S., supporting over 66,000 direct jobs, mostly held by women, many of whom had been drug addicts, says the BBC.
Across Africa, AGOA has enabled the export of over 6,000 products to the U.S., ranging from textiles to agricultural goods (many of which cannot be grown profitably in the U.S.). The
jumpstart for African economies has also enabled many nations to expand their reach into globa markets – and the 2022 African Continental Free Trade Area agreement holds potential for vast expansion of intra-African trade.
But nearly everyone agrees that pulling the AGOA plug now puts the future of African enterprise at risk. Kenya’s Trade Minister Lee Kinyanjui, who is also seeking a bilateral trade agreement with the U.S., says that “an ideal situation would be the extension of AGOA so transition mechanisms can be put in place.”
No one was fully ready for an abrupt end to AGOA, given that politicians from both major U.S. parties had been singing “Kumbaya” to the theme of AGOA renewal – but without the Hallelujah chorus to celebrate a formal extension. For many firms, any gap in sales will mean shutting down operations before they are able to find alternative markets to stay afloat.
There will be winners and losers unless things change.
The International Trade Center in Geneva envisions major impacts on apparel and tuna exports from Kenya, Tanzania, Cape Verde, Lesotho, and Eswatini. South Africa, which is at odds with the U.S. on key matters of international policy, could face a 17% drop in shipments, largely of metals, vehicles, and chemicals. But Angola’s oil producers won that nation an exemption from U.S. tariffs, and Senegal may prosper thanks to exports of titanium and zirconium.
President Trump is known for favoring trade over aid. Extending the lifespan of the AGOA can go far to ease the pain of the portions of the USAID budget that actually impacted the daily lives of African entrepreneurs and wage earners. It can also provide more time for each nation to negotiate longer term trade agreements with the U.S. and other nations outside the AfCFTA as well as to rebuild ancient intracontinental trade routes long ago disrupted by colonial powers.
Congressional leaders had considered including a clean 16-year reauthorization for AGOA in the FY 2025 National Defense Authorization Act -- but politics got in the way. Politics also prevented any action on AGOA extension during the unsuccessful campaign to pass a “clean” bill to fund federal government operations.
What this posturing means for sub-Saharan Africa is that the U.S. Senate is blocking any further action on AGOA – and hurting African enterprises and their employees.
Editor’s Note: The Schumer Shutdown is here. Rather than put the American people first, Chuck Schumer and the radical Democrats forced a government shutdown for healthcare for illegals. They own this.
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