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Date: Fri, 3 Nov 2000 19:17:56 EST
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Subject: [AfricaMatters] US moves to sell Growth Act to African private
sector
November 2, 2000
US moves to sell Growth Act to African private sector
By GUMISAI MUTUME
Washington (IPS) - The US government is moving ahead with plans to implement
the Africa Growth and Opportunity Act (Agoa) and has released a manual that
explains the law's provisions to would-be beneficiaries.
There are two remaining steps the US government needs to complete before the
trade act, signed into law under the wider Trade and Development Act of 2000
by President Bill Clinton in May, starts operating.
''The President must designate the additional African products eligible to
receive duty-free treatment, a process we expect will be completed in a
matter of weeks,'' US deputy trade representative Ambassador Susan Esserman
told a World Bank and International Monetary Fund (IMF) "Africa Forum 2000"
being held in Washington this week.
She said that the US also needed to ascertain that eligible countries have
developed effective customs related requirements. Only Mauritius and Kenya
still have to comply in order for them to qualify for duty-free treatment for
apparel products.
President Clinton last month completed the designation of the initial 34
countries that will benefit from Agoa.
These are Benin, Botswana, Cape Verde, Cameroon, Central African Republic,
Chad, Republic of Congo, Djibouti, Eritrea, Ethiopia, Gabon, Ghana, Guinea,
Guinea Bissau, Kenya, Lesotho, Madagascar and Malawi.
Mali, Mauritania, Mauritius, Mozambique, Namibia, Niger, Nigeria, Rwanda, Sao
Tome and Principe, Senegal, Seychelles, Sierra Leone, South Africa, Tanzania,
Uganda and Zambia have also made the list.
A second list may be issued in January.
To qualify countries have to establish market-based economies, political
pluralism, eliminate barriers to US trade and investment and protect
intellectual property rights as provided for under the World Trade
Organisation (WTO).
While Agoa's main provisions concern textiles and apparels it technically
provides eligibility to all products, as long as they meet its rules of
origin requirements, are imported directly from Africa and are not considered
'import-sensitive' by the US government.
A full list of products eligible for duty-free entry will be released by
year-end.
Implementation guide
The Office of the US Trade Representative published an Agoa implementation
guide this week, which spells out the conditions of eligibility and how the
law works.
It explains procedures such as the annual review process, which will either
keep nations on the list if they continue to comply with the provisions of
the Act, or remove them, if the US president deems it necessary.
The release of the Agoa manual coincided with the "Africa Forum 2000" a
biennial meeting organised by the Africa Club - an association of World Bank
and IMF staff attempting to channel the institutions towards sustainable
development of the continent.
The Forum invited African business people to add their voices to the global
economic dialogue from which the continent continues to be marginalised.
''We are all aware that the job is only begun and only a few countries will
benefit from Agoa in its present form,'' businessman Anthony Carrol told the
Forum.
"This forum should form a constituency to lobby for the expansion of the
act'' in terms of eligibility and the limits placed on imports from Africa.
It has been noted that only the few relatively industrialised countries such
as Mauritius and South Africa will benefit most from the act as they will
find it easier to meet the requirements of the US market.
''The bigger countries can easily produce for the mass market,'' says Lindi
Ilonze a development consultant from Namibia.
''Also, it is often not the tariffs that keep our products out of such
markets, but the artificially high codes and standards they set for
developing countries, which mean we have to import higher technology and push
up the cost of production.''
As tariffs and trade restrictions decline in world trade, it is increasingly
being recognised that the use of provisions such as the WTO's sanitary and
phytosanitary measures (SPS) by rich nations are the greatest impediment to
the agricultural and food products of developing nations.
Such provisions measure the level of protection accorded to human, plant and
animal health in the production process, and developing countries say the
standards are set too high for them.
SPS controls in many developing countries are weak and overly fragmented,
according to a recent study by the University of Reading's Centre for Food
Economics Research.
US-Africa trade
Currently, trade with Africa only constitutes one percent of US exports,
imports and foreign investment.
Under Agoa apparel made in Africa with African fabric and yarn will enter the
US duty-free and quota-free up to a limit of 1.5 to 3.5 percent of the US
apparel import market estimated to be valued at $66 billion.
African apparel imports made with African fabric and yarn currently total
about $250 million.
Apparel from sub-Saharan Africa that meet Agoa's criteria will obtain
duty-free access until 2008 while imports from other suppliers with which the
United States does not have free trade agreements will be assessed for
regular tariffs.
These average 17.5 percent of the value of the product.
Delegates to the Africa Forum 2000 also raised concerns about the methods the
United States would use to ascertain that exporting countries comply with the
rules of origins.
This would take place under strict regimes including physical factory
inspections by US customs. The Act provides for additional funding to US
Customs. '
"Agoa is not just about putting labels on goods made in China,'' says Janet
Labuda, a director at the US Customs who dubs herself the "enforcer".
''We will look at employee records, even electricity bills,'' to ascertain
that goods are made in the factories and countries they are said to be made
in.
However, while delegates generally welcomed Agoa as a move towards expanding
US-Africa trade, several of them noted that Agoa should go beyond trade
figures, to dismantling US attitudes towards Africans as exemplified by the
large number of private sector members who were denied travel visas to attend
the Forum.
''Africans are treated like animals at US embassies and many business people
cannot obtain visas to come to the US,'' says Philomena Desmond a consultant
with the Business Women's Network.
''How can you trade with a country, if you cannot even visit it?''
from MISAnet/Inter Press Service
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