The Sixth Africa Growth and Opportunity Act (AGOA) Forum will be held this week in the Ghanaian capital Accra from July 18 to the 19. AGOA, which was passed by the U.S. Congress in 2000, is the cornerstone of the United States’ trade and investment policy with sub-Saharan African countries. Ahead of the Sixth AGOA Forum, the U.S. Trade Representative recently submitted a comprehensive report to Congress on U.S. trade and investment policy with sub-Saharan Africa.
Florie Liser is Assistant US Trade Representative for Africa. She told VOA two-way trade between the U.S. and sub-Saharan Africa has been increasing.
“We put the AGOA program in place in 2000, and I think the first year of data that we really have for AGOA is 2001. And in that period of time from 2001 to now, we’ve had an increase in our two-way trade of about a 150 percent. AGOA includes oil products. And so if you include all of the oil products, and you look at our imports from the AGOA countries in 2006, it was up about 16 percent over 2005. Most of that was because of oil. But what’s really important to watch is what happens with non-oil AGOA trade. That trade increased by seven percent in 2006 over the 2005 period,” she said.
Liser said non-oil AGOA trade is growing because certain non-oil products are increasingly being exported to the United States from Africa.
“Non-oil trade is increasing because we are having really growth in certain sectors in terms of their export to us. Footwear is one, fruits is another; prepared vegetables, cut flowers. These are some of the sectors that are experiencing significant growth to the U.S,” Liser said.
She said the number of sub-Saharan African countries eligible for AGOA has also been on the rise.
“We have a total of 38 countries that are eligible for AGOA, and that’s out of 48 sub-Saharan African countries. We added Liberia on January 1, 2007. We would definitely like to see more countries benefiting from AGOA. It’s there for them; It’s an opportunity we would like them to take advantage and maximize. But we would also like to see the countries expand the number of products that they send to us, especially value-added, processed types of products,” she said.
U.S. Trade Representative Susan Schwab has said that “trade is the best tool we have to alleviate poverty and spur economic development, and AGOA is a key element in America’s effort.”
While not saying that trade is more important than aid to Africa, Liser said the real power for economic growth and poverty alleviation comes from trade.
“Here’s why Ambassador Schwab said what she said. Right now Africa has about 2 percent of global trade. But that two percent, what we know is that that there is a Blair Report that’s out and several others that show if Africa were able to increase their share of world trade just one percent, to move it from two percent that they currently have to three percent, that would generate about 70 billion dollars every year in additional revenue for the African countries. Now that 70 billion is about three times as much as the total development assistance or aid that they get from everybody in the world. Now we are not saying it’s one or the other, but we are simply showing that the real power for economic growth and for poverty alleviation really comes from trade,” Liser said.
She said her office would like to see more U.S. foreign direct investment to Africa. Liser said while the total U.S. foreign direct investment to Africa is about one percent of all U.S. investment worldwide, the figure rose in 2006 by about 16 percent.