ABOUT AGOA

The African Growth and Opportunity Act (AGOA) was signed into law on May 18, 2000 as Title 1 of The Trade and Development Act of 2000. The Act offers tangible incentives for African countries to continue their efforts to open their economies and build free markets.

General Country Eligibility Provisions
The U.S. Government intends that the largest possible number of Sub-Saharan African countries are able to take advantage of AGOA. President Clinton issued a proclamation on October 2, 2000 designating 34 countries in Sub-Saharan Africa as eligible for the trade benefits of AGOA.

The proclamation was the result of a public comment period and extensive interagency deliberations of each country’s performance against the eligibility criteria established in the Act. On January 18, 2001, Swaziland was designated as the 35th AGOA eligible country and on May 16, 2002 Côte d'Ivoire was designated as the 36th AGOA eligible country. On January 1, 2003 The Gambia and the Democratic Republic of Congo were designated as the 37th and 38th AGOA eligible countries. On January 1, 2004, Angola was designated as AGOA eligibile. Effective January 1, 2004, however, the President removed the Central African Republic and Eritrea from the list of eligible countries. On December 10, 2004, the President designated Burkina Faso as AGOA eligible. Effective January 1, 2005, the President removed Côte d'Ivoire from the list of eligible countries. The U.S. Government will work with eligible countries to sustain their efforts to institute policy reforms, and with the remaining 11 Sub-Saharan African countries to help them achieve eligibility.

The Act authorizes the President to designate countries as eligible to receive the benefits of AGOA if they are determined to have established, or are making continual progress toward establishing the following: market-based economies; the rule of law and political pluralism; elimination of barriers to U.S. trade and investment; protection of intellectual property; efforts to combat corruption; policies to reduce poverty, increasing availability of health care and educational opportunities; protection of human rights and worker rights; and elimination of certain child labor practices. These criteria have been embraced overwhelmingly by the vast majority of African nations, which are striving to achieve the objectives although none is expected to have fully implemented the entire list.

The eligibility criteria for GSP and AGOA substantially overlap, and countries must be GSP eligible in order to receive AGOA’s trade benefits including both expanded GSP and the apparel provisions. Although GSP eligibility does not imply AGOA eligibility, 45 of the 48 Sub-Saharan African countries are currently GSP eligible.

Countries Eligible for AGOA Benefits
Angola; Benin; Botswana; Burkina Faso; Cameroon; Cape Verde; Chad; Republic of Congo; Democratic Republic of Congo; Djibouti; Ethiopia; Gabon; The Gambia; Ghana; Guinea; Guinea-Bissau; Kenya; Lesotho; Madagascar; Malawi; Mali; Mauritania; Mauritius; Mozambique; Namibia; Niger; Nigeria; Rwanda; Sao Tome and Principe; Senegal; Seychelles; Sierra Leone; South Africa; Swaziland; Tanzania; Uganda; Zambia.

Frequently Asked Questions

Q: How does AGOA benefit African countries?
A: AGOA passed as part of The Trade and Development Act of 2000 provides beneficiary countries in Sub-Saharan Africa with the most liberal access to the U.S. market available to any country or region with which we do not have a Free Trade Agreement. It reinforces African reform efforts, provides improved access to U.S. credit and technical expertise, and establishes a high-level dialogue on trade and investment in the form of a U.S.-Sub-Saharan Africa Trade and Economic Forum.

Q: How does it benefit U.S. firms?
A: By creating tangible incentives for African countries to implement economic and commercial reform policies, AGOA contributes to better market opportunities and stronger commercial partners in Africa for U.S. companies. The Act should help forge stronger commercial ties between Africa and the United States, while it helps to integrate Africa into the global economy. U.S. firms may find new opportunities in privatizations of African state-owned enterprises, or in partnership with African companies in infrastructure projects.

Q: Why the need for an AGOA II bill?
A: The need for AGOA II legislation was developed in part to improve upon and clarify some of the specific provisions that were not addressed in the original AGOA legislation (or AGOA I). AGOA II is part of the Trade Act of 2002 which President Bush signed into law on August 6, 2002.

Q: What specific changes did the AGOA II legislation make to the original AGOA law?
A: Click here to view a table comparing AGOA I and AGOA II

Q: What specific changes did the AGOA Acceleration Act of 2004 make to the original AGOA law?

A: Click here to view a summary of the AGOA Acceleration Act of 2004.

Q: What benefits are provided for Botswana, Namibia, and Mauritius?
A: AGOA II permits Botswana and Namibia to qualify for the "Special Rule," which permits lesser developed AGOA beneficiary countries to utilize fabric manufactured anywhere in the world (extended until September 30, 2007 under AGOA III). Since Botswana's and Namibia's per capita GNP exceeded $1,500 (the 1998 World Bank level), they were not designated as a lesser developed beneficiary country and were not eligible for the Special Rule under the original AGOA legislation. An amendment to the AGOA Acceleration Act of 2004 grants lesser-developed beneficiary country status to Mauritius, also qualifying the country for the "Special Rule." The amendment limits Mauritius to a cap of 5% of the Special Rule cap, about 27 million square meter equivalents (SMEs).

Q: What conditions are placed on participation by African countries?
A: The President may designate Sub-Saharan African countries as eligible to receive the benefits of the Act if they are making progress in such areas as: establishment of market-based economies; development of political pluralism and the rule of law; elimination of barriers to U.S. trade and investment; protection of intellectual property; efforts to combat corruption; policies to reduce poverty, increase availability of health care and educational opportunities; protection of human rights and worker rights, and elimination of certain practices of child labor. Progress in each area is not a requirement for AGOA eligibility.

Q: Which countries have been designated as AGOA eligible?
A: Click here for a list of AGOA eligible countries

Q: Does the United States have the right to set eligibility criteria for African countries?
A: The criteria are standards which the Africans themselves have espoused and most are striving to uphold. But Congress never intended AGOA to be a blank check for all African countries, without regard to performance. It was meant to offer tangible incentives for African governments to improve their political and economic governance, not to underwrite poor policies.

Q: What are the provisions governing apparel imports?
A: AGOA provides duty-free and quota-free treatment for eligible apparel articles made in qualifying Sub-Saharan African countries through 2015. Qualifying articles include: apparel made of U.S. yarns and fabrics; apparel made of Sub-Saharan African (regional) yarns and fabrics, subject to a cap; apparel made in a designated lesser-developed country of third-country yarns and fabrics, subject to a cap; apparel made of yarns and fabrics not produced in commercial quantities in the United States; certain cashmere and merino wool sweaters; and eligible handloomed, handmade, or folklore articles; and ethnic fabrics. Under a Special Rule for lesser-developed beneficiary countries, those with a per capita GNP under $1,500 in 1998, will enjoy an additional preference in the form of duty-free/quota-free access for apparel made from fabric originating anywhere in the world. The Special Rule is in effect until September 30, 2007 and is subject to a cap. AGOA II designates Botswana and Namibia as lesser-developed beneficiary countries (click here for further details on apparel eligibility provisions).

Q: Which countries fall under the per capita GNP ceiling for the Special Rule?
A: All Sub-Saharan African countries meet the per capita GNP requirements of the Special Rule with the exception of the following: Botswana, Gabon, Mauritius, Namibia, Seychelles, and South Africa. However, countries must meet the general AGOA eligibility requirements and the requirements for apparel benefits in order to qualify for the Special Rule. AGOA II grants Lesser Developed Beneficiary Country status to Botswana and Namibia, qualifying both countries for the Special Rule.

Q: When do the apparel benefits take effect?
A: Although the apparel benefits take effect October 1, 2000, beneficiary countries must first have an effective visa system in place to prevent illegal transshipment and use of counterfeit documentation. They must also institute enforcement and verification procedures. Details were disseminated to African governments following a cable instruction to all U.S. embassies in Sub-Saharan Africa on September 21, 2000. Countries must also be beneficiary developing countries under the U.S. Generalized System of Preferences (GSP), which includes 45 Sub-Saharan African countries.

Q: What does the term "knit-to-shape" mean?
A: Components that take their shape in the knitting process, rather than being cut from a bolt of cloth.

Q: What are the Act’s GSP provisions?
A: AGOA authorizes the President to provide dutyfree treatment under GSP for any article, after the U.S. Trade Representative (USTR) and the U.S. International Trade Commission (USITC) have determined that the article is not importsensitive when imported from African countries. On December 21, 2000, the President extended duty-free treatment under GSP to AGOA eligible countries for more than 1,800 tariff line items in addition to the standard GSP list of approximately 4,600 items available to non-AGOA GSP beneficiary countries. The additional GSP line items which include such previously excluded items as footwear, luggage, handbags, watches, and flatwarewere implemented after an extensive process of public comment and review. Sub-Saharan African GSP beneficiary countries are also exempted from competitive need limitations. In order for any Sub-Saharan African country to receive the liberalized GSP benefits it must first be GSP eligible under the existing criteria of that law.
GSP is extended for Sub-Saharan African beneficiary countries until September 30, 2015.

Q: How can African countries become more familiar with the benefits of the Act?
A: We have conducted technical assistance seminars in Africa and the United States to explain the benefits of the Act, in order to ensure that African countries are able to take maximum advantage of its provisions.

 

More resources about AGOA

- AGOA Agenda

- AGOA articles in Washington File

- AGOA success story