The United States government says Nigeria has only taken advantage of the African Growth and Opportunity Act, AGOA, partially, through petroleum.
The US government, through its Assistant Secretary of State for African Affairs, Ambassador Tibor Nagy, and the Assistant US Trade Representative for Africa, Ms Constance Hamilton, said this on Tuesday, July 23, 2019 during a telephone press briefing on the forthcoming 2019 AGOA Forum.
Signed into law by a former US President Bill Clinton in May 2000, AGOA’s objectives include the expansion and deepening of the trade and investment relationship of the US with sub-Saharan Africa.
According to a statement on Wednesday by the Public Affairs Section of the US Consulate General, Lagos, Nagy and Hamilton noted that the AGOA Forum was a key component of the US-Africa relationship, that focuses on increasing the United States’ trade and investment in Africa as a mechanism for job creation within the continent.
On why Nigerian companies had not been able to efficiently key into the business opportunities offered by AGOA, Hamilton said Nigeria needed to diversify its economy to take full advantage of the initiative.
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She said, “I think that Nigeria has not taken advantage of AGOA because they send us mainly oil… To a certain extent, Nigeria is taking advantage of it (AGOA) – probably more than some of the other countries – but it is petroleum.
“And oil doesn’t really create the kind of jobs or other benefits from trade that I think countries are looking for
“So I think Nigeria, and I think the new government is talking about trying to expand and go beyond just petroleum production and get into other things, but that really is a question for what Nigeria wants to see happen,” Ms Hamilton said.
Ms Hamilton said Nigeria’s recent decision to sign up for the African Continental Free Trade Area Agreement would remove barriers to trade and investment within the region.
“It will also be submitting its commitments on liberalisation, those are opportunities to open up the Nigerian market in many, many ways, not just for the United States and other partners outside of Africa, but also within the region.”
Since 2000, AGOA has been the cornerstone of the United States’ economic engagement with Sub-Saharan Africa, allocating over $7 billion for trade capacity building initiatives on the continent.
But the initiative has not led to trade diversification it was originally designed for.
While petroleum products – at 67 per cent – continued to account for the largest portion of African exports to the U.S., the volume of trade has remained modest.
For instance, in the clothing sector, the U.S. spends about $1 billion on African imports, roughly one per cent of the $95 billion it spends on global clothing imports.
Ms Hamilton said to maximise AGOA, countries must take an active role in creating the competitive conditions in which companies, entrepreneurs, and farmers can thrive.
“The AGOA’s eligibility criteria were designed to help improve these conditions.”
Nagy however, said the U.S. policy towards Africa, particularly the increasing trade and investment, is not an anti-China policy.
“It is a pro-Africa and U.S. trade policy, especially to give Africans additional choices,” said Mr Nagy.
“I mean, I have been quite critical in my comments about our own efforts in the past. I said that in the past when there was a knock on Africa’s door for trade and investment, and they opened the door, only China is standing there.
“I absolutely do not blame Africa for doing all the deals with China. Well what we would like to do in the U.S. government is make sure that in the future, when there’s a knock on the door, there’s also the U.S. standing there, through our vast private sector which is very eager to engage with Africa.”
Yetunde Adegoke
