AGOA and AfCFTA: Paving the Way for Trade with the US until 2041

The African Growth and Opportunity Act (AGOA) could see a significant extension until 2041, granting duty-free access to U.S. markets for forty African nations. A bipartisan bill, the AGOA Renewal and Improvement Act of 2024, has been tabled in Congress by Senators Chris Coons and James Risch. This revised bill integrates AGOA with the African Continental Free Trade Agreement (AfCFTA), incentivizing more African countries to join the regional trade agreement.

The proposed bill links AGOA’s trade benefits directly to membership in AfCFTA, aiming to foster the development of intra-African supply chains. This move is expected to boost the utilization of the trade pact by African states and increase trade between Africa and the United States.

Currently, only 35 eligible African countries are leveraging the U.S. trade program, with varying levels of utilization. Top performers like Kenya and Lesotho have high utilization rates, while others face tariffs on the majority of their exports to the U.S.

Critics of AGOA argue for deeper, more reciprocal trade relationships, but supporters highlight its role in promoting economic growth and development across Africa. The extension of AGOA comes at a crucial time when global powers are competing for influence in Africa, prompting the U.S. to reassess its strategies in the region.

Experts believe that the extension of AGOA will strengthen U.S.-Africa relations and provide American businesses with opportunities to expand their presence on the continent. The bill aims to support economic development in Africa while enhancing ties between the United States and its partners on the continent.