Unpacking African Growth and Opportunity Act (Agoa) Gains Under Trump

KEY POINTS

• Agoa offers duty-free access to over 1,800 products, boosting exports for sub-Saharan African countries like Kenya, Rwanda, and the DRC.
• Uganda faces Agoa suspension over human rights issues, reducing its export competitiveness to the U.S. market.
• With Agoa’s 2025 expiration approaching, African nations must capitalize on trade opportunities while addressing compliance challenges.

The African Growth and Opportunity Act (Agoa), a pivotal trade initiative introduced by the United States in 2000, has provided eligible sub-Saharan African countries with duty-free access to the U.S. market for thousands of products. 

With Agoa set to expire in 2025, the program’s future under former President Donald Trump’s potential return to office remains uncertain, sparking renewed interest in its economic impact and policy direction.

A lifeline for African exports

According to Zawya, Agoa offers duty-free access to over 1,800 products in addition to 5,000 items under the Generalized System of Preferences (GSP). Countries like Rwanda, Kenya, Tanzania, and the Democratic Republic of Congo (DRC) have leveraged this opportunity to bolster exports of key goods, including apparel, agricultural products, and manufactured items.

Rwanda, for instance, rejoined Agoa after a suspension linked to restrictions on U.S. second-hand clothing imports. While still barred from exporting apparel under Agoa, Rwanda has utilized the framework to support other sectors.

Meanwhile, Kenya, the region’s top Agoa beneficiary, saw exports worth $268 million in the fiscal year ending June 2023, accounting for 47 percent of its total U.S. exports.

Challenges and controversies

Despite its benefits, Agoa’s implementation has faced hurdles, including eligibility revocations due to governance issues and policy disagreements.

Uganda was suspended from Agoa in January 2024 following the passage of a controversial anti-homosexuality law, drawing international criticism and impacting its export competitiveness. Uganda’s government dismissed the suspension’s significance, emphasizing self-reliance and regional trade over dependency on Western markets.

Similarly, Rwanda’s earlier suspension under Trump’s administration in 2018 stemmed from tariffs on second-hand clothing imports, part of an effort to promote local manufacturing. While the move was supported by the East African Community (EAC), other member states, including Kenya and Tanzania, adjusted their policies to maintain Agoa benefits.

The road ahead

The bipartisan support for Agoa’s extensions in U.S. Congress suggests potential continuity, even under Trump’s return. However, African nations must navigate evolving U.S. trade policies and adapt strategies to maximize benefits. Rwanda and the DRC exemplify the potential of leveraging Agoa to strengthen local industries, but countries like Uganda and South Sudan face challenges due to governance and human rights concerns.

Economic impact

Agoa remains a cornerstone of U.S.-Africa trade relations, facilitating economic diversification and growth. As the program’s expiration nears, eligible countries are under pressure to capitalize on its benefits while addressing internal challenges to maintain compliance and competitiveness. The next phase of Agoa, under any U.S. administration, will be critical for sustaining Africa’s integration into global trade.