With the expiry of the African Growth and Opportunity Act (Agoa) just 15 months away, South Africa is continuing to advocate for an early and substantial extension of the preferential trade arrangement with the United States.
The trade pact, which has been in place since 2000, provides duty-free access to the US market for eligible African countries.
Malose Letsoalo, chief director for bilateral trade relations at the Department of Trade, Industry and Competition, stated this week that South Africa remains optimistic about Agoa being extended beyond its scheduled expiration in September 2025.
The South African government is hoping the renewal process by the US Congress will be concluded by early 2024.
President Cyril Ramaphosa emphasized the importance of Agoa in his weekly newsletter, noting that it enhances the diversification of African economies by enabling the export of value added products.
He cited the example of South Africa's automotive industry, which sources components from various African countries and exports finished vehicles to the US, duty-free, under AGOA.
The extension of Agoa could significantly contribute to the further diversification of African economies, enabling countries to produce a wider range of products using their abundant resources.
It could also encourage the development of regional value chains across different countries. South Africa, the largest trading partner of the US in Africa, has been actively motivating for the extension of Agoa.
The country's Trade, Industry and Competition minister, Ebrahim Patel, expressed confidence in South Africa's continued inclusion in the programme during a media briefing ahead of the recent Agoa Forum in Johannesburg.
The 20th Agoa Forum, which concluded on November 4, 2023, discussed ways to strengthen the inclusive trading partnership between the US and 35 eligible African countries.
Participants emphasised the need for an extension of Agoa beyond 2025 to provide certainty for companies wanting to invest or expand their operations in Africa.
As South Africa continues to push for an early and substantial extension of Agoa, the country remains optimistic about the future of its trade relationship with the US, and the potential for economic growth and job creation, through this preferential trade arrangement.
