Displayed with permission from allAfrica.com
The African Growth and Opportunity Act (AGOA) is currently facing an uncertain future following the election of Donald Trump, the protectionist US President-elect, who has threatened to tear up international trade deals.
AGOA, first introduced by the administration of former US President Bill Clinton and later signed by George HW Bush, gives African manufacturers tariff-free access to the US market.
“It is hard to see how AGOA is sustained in a Trump administration,” Witney Schneidman, senior international advisor for Africa international law firm Covington & Burling, and a key player in the passage and reauthorisation of AGOA, has said, adding that, the act was under threat by the unpredictable Trump.
Contributing, the former South African Reserve Bank Governor, Tito Mboweni, has slammed AGOA, claiming that the US trade pact has benefited Chinese business owners and stymied Ghanaians and other African manufacturing capacity.
“Chinese entrepreneurs benefited from AGOA. Very few African entrepreneurs benefited,” Mboweni, has stated when speaking at the Global Expo conference in Gaborone, Botswana.
Supporters of the act have credited it with creating some 350,000 direct jobs on the continent in industries as diverse as vehicles, garments and metalwork.
Yet Mboweni, now a board member of the Shanghai-headquartered BRICS Development Bank, believes that the act simply handed control of African manufacturing to Chinese owners while doing little to assist home-grown industries.
“Why is that the case? They say it’s not a nice thing to say but we have to tackle that question of supporting our African entrepreneurs when an opportunity like this arises,” he said.
He added: “And for our governments to build many shell factories and literally hand them over to Chinese entrepreneurs is actually an embarrassment for all of us.”