Updated March 26, 2020
African Growth and Opportunity Act (AGOA)
Overview
product diversification, and regional cooperation, and
What is AGOA? AGOA (P.L. 106-200, as amended), a
educate African entrepreneurs.
cornerstone of U.S. trade policy toward sub-Saharan Africa
What is the goal? Through AGOA, the U.S. Congress
since 2000, is a nonreciprocal U.S. trade preference
seeks to increase U.S. trade and investment with the region,
program that provides duty-free access to the U.S. market
promote sustainable economic growth through trade, and
for most exports from eligible sub-Saharan African
encourage the rule of law and market-oriented reforms.
countries. In addition to preferential market access, the Act
also requires an annual forum, known as the AGOA Forum,
Supporting views. Supporters of AGOA argue that the
held between U.S. and AGOA country officials to discuss
program affords African producers an important
trade-related issues. Additionally, AGOA provides
competitive advantage in the U.S. market, thereby enabling
direction to select U.S. government agencies regarding their
exports, encouraging investment in the region, boosting
trade and investment support activities in the region.
private sector activity and economic growth, and ultimately
generating demand for U.S. goods and services as the
Which countries are eligible? AGOA lists 49 sub-Saharan
region’s economies develop.
African countries that are potential candidates for program
benefits. AGOA eligibility criteria address issues such as
Opposing views. Opposition is mostly from U.S. producers
trade and investment policy, governance, worker rights, and
that may face increased import competition from AGOA
human rights, among other issues, which countries must
countries. Such concerns are generally limited due to the
satisfy to be beneficiaries of the AGOA preferences. The
low volume of U.S. imports under AGOA, but import
President annually reviews and determines each country’s
competing U.S. producers have lobbied to keep certain
AGOA eligibility. There are currently 38 AGOA-eligible
products, particularly sugar, out of the program.
countries. In the most recent eligibility determination,
U.S. Imports under AGOA
President Trump removed AGOA benefits for Cameroon,
effective January 1, 2020, due to violations of AGOA’s
Total U.S. AGOA imports were $8.4 billion in 2019, down
eligibility criteria pertaining to human rights. An ongoing
from $12.0 billion in 2018. Imports remain concentrated in
review of South Africa’s eligibility under the Generalized
key countries and industries, but diversification is growing.
System of Preferences (GSP) due to concerns over its
Energy products, mainly crude oil, accounted for $4.6
protection of intellectual property rights could also result in
billion of U.S. AGOA imports (55%) in 2019, down
lost AGOA eligibility as AGOA builds on GSP and
more than $40 billion from their 2011 peak. Nigeria was
requires that beneficiary countries satisfy both programs’
the top crude supplier ($3.1 billion) in 2019.
eligibility criteria (see Relation to GSP below).
AGOA non-energy imports have grown from $1.3
Ten other sub-Saharan African countries remain ineligible
billion in 2001 to $3.8 billion in 2019. Top non-energy
for the program’s preference benefits in 2020 based on
import categories include textiles and apparel ($1.4
prior determinations. They include (with noted eligibility
billion), agricultural products ($656 million), minerals
violations): Burundi (political violence), the Democratic
and metals ($510 million), transportation equipment
Republic of Congo (human rights), Equatorial Guinea
($499 million), and chemicals ($434 million).
(income graduation), Eritrea (human rights), Mauritania
Figure 1. Top AGOA Countries, Non-Energy Products
(worker rights), Seychelles (income graduation), Somalia
(never eligible), South Sudan (political violence), Sudan
(never eligible), and Zimbabwe (never eligible). In addition,
Rwanda’s AGOA benefits for apparel exports have been
suspended since July 31, 2018, following an out-of-cycle
eligibility determination in response to increased tariff
barriers on used clothing imports from the United States.
What is the authorization status? AGOA was first
established by Congress in 2000 and has been amended
several times. The Trade Preferences Extension Act of
2015, P.L. 114-27, extended AGOA’s authorization for ten
years to September 2025. Most recently, the African
Source: Analysis by CRS. Data from USITC.
Growth and Opportunity Act and Millennium Challenge
South Africa is the top supplier of AGOA non-energy
Act Modernization Act of 2018, P.L. 115-167, required the
imports (Figure 1), but its dominance has declined.
Administration to provide information on AGOA through
Decreasing auto imports from South Africa (down $1.8
an official AGOA website, promote AGOA utilization,
billion from their 2013 peak) and increasing apparel
imports from other top countries are the main trends
https://crsreports.congress.gov
African Growth and Opportunity Act (AGOA)
underlying this shift. AGOA imports from Ethiopia, for
Reporting requirements. The 2015 reauthorization
example, grew by 55% or $87 million in 2019 alone.
reinstated a previous AGOA requirement to report
biennially on overall U.S. trade and investment relations
Key Aspects of AGOA
with the region. The June 2018 report is the most recent.
Trade preferences. AGOA’s main component is duty-free
Reciprocal trade negotiations. Since 2000, Congress has
treatment of U.S. imports of certain products from
directed the Administration to seek reciprocal trade and
beneficiary countries. This tariff savings can help AGOA
investment negotiations with AGOA countries. The only
exporters compete with lower-cost producers elsewhere.
attempt to date, with the Southern African Customs Union
Relation to GSP. The Generalized System of Preferences
(SACU), was suspended in 2006 due to divergent views
(GSP) is another U.S. trade preference program, but unlike
over scope. In a new effort, on March 17, 2020, the Trump
AGOA, GSP is not regionally based. The AGOA
Administration notified Congress of its intent to begin free
preferences include all products covered by GSP, as well as
trade agreement (FTA) negotiations with Kenya. Such
some products excluded from GSP, such as autos and
notification is required under Trade Promotion Authority
certain types of textiles and apparel. In order to remain
(TPA) at least 90 days before talks may begin. USTR has
eligible for AGOA, sub-Saharan African countries must
described the talks as an opportunity to negotiate a new
meet the eligibility requirements for both programs (19
“model” bilateral FTA with an African country, but has not
U.S.C. §2466). In both GSP and AGOA, additional benefits
specified what the new model may entail. U.S. FTAs
are granted to least-developed countries. AGOA
typically include comprehensive tariff elimination as well
beneficiaries maintain access to both programs, even if GSP
as enforceable commitments on services, investment,
authorization lapses (currently to occur at the end of 2020).
intellectual property rights, labor, and environment.
President Uhuru Muigai Kenyatta of Kenya argues that a
Apparel and third-country fabric provision. AGOA’s
bilateral U.S. FTA will not hinder Kenya’s participation in
duty-free treatment of certain apparel products is significant
broader regional integration initiatives, but some African
because (1) apparel articles face relatively high U.S. import
officials express reservations over the bilateral approach.
tariffs; (2) they are generally excluded from GSP; (3) they
can be readily manufactured in developing countries as
. .establishing a more stable, permanent, and mutually
their production requires less skilled labor and capital
beneficial trade and investment framework with the United
investment; and (4) production in this sector can be a first-
States could be transformative for Africa.
step toward higher value-added manufacturing. The third
country fabric provision in AGOA, which is a major factor
USTR Robert Lighthizer, July 7, 2018
in AGOA countries’ competitiveness in the sector, allows
limited amounts of U.S. apparel imports from least-
Issues for Congress
developed sub-Saharan African countries to qualify for
AGOA generally enjoys bipartisan support in Congress and
duty-free treatment even if the yarns and fabrics used in
is not subject to reauthorization until 2025. Current issues
their production are imported from non-AGOA countries
Congress may consider include the following:
(e.g., apparel assembled in Kenya with Chinese fabrics can
qualify for duty-free treatment under AGOA).
FTA negotiations. An FTA would have implications
for AGOA and U.S. trade relations in the region. As the
Trade capacity building (TCB). AGOA also directs the
Administration consults with Congress on scope and
President to provide TCB to AGOA beneficiaries. The U.S.
objectives for talks with Kenya, key considerations
Agency for International Development (USAID)
include (1) what flexibilities (e.g., longer phase in
administers certain TCB-related projects in support of
periods, less extensive commitments, greater technical
AGOA, including funding three African Trade and
assistance, flexible rules of origin such as an AGOA
Investment Hubs, which work to increase AGOA utilization
style third-country fabric rule) are appropriate; (2)
by beneficiary countries and facilitate regional producers’
potential effects on broader AGOA utilization; and (3)
access to international markets. AGOA also directs other
how bilateral FTAs may affect regional initiatives, such
agencies, including the Export-Import Bank, U.S. Foreign
as the African Continental Free Trade Area (AfCFTA).
Commercial Service, and USDA, on expansion of their
Trump Administration tariffs. Increased U.S. tariffs
activities in sub-Saharan Africa.
on steel and aluminum (and potentially autos) raise the
AGOA forum. AGOA requires the President to convene an
cost of imports from AGOA countries, notably South
annual forum to discuss trade and investment relations and
Africa, a top U.S. supplier of aluminum and autos.
implementation of AGOA, which alternates between
Congress may examine the tariffs’ effects on AGOA
Washington, D.C., and an AGOA country. The 18th AGOA
participants and alignment with congressional goals.
Forum took place in Cote d‘Ivoire, in August 2019.
Third-party agreements. Reciprocal agreements
Country eligibility reviews. The President determines
between AGOA beneficiaries and third parties (e.g., EU-
eligibility based on statutory criteria. The process includes
South Africa) may disadvantage U.S. exporters.
an annual public comment period and hearing, and, as
Congress may examine possible U.S. responses.
amended by the 2015 reauthorization, allows for out-of-
Beneficiary country participation. More than 90% of
cycle reviews (outside the annual review period) in
U.S. non-energy imports under AGOA come from six
response to public petitions. The Administration may
countries. Congress may examine factors affecting other
remove country eligibility entirely or for specific products,
countries’ capacity to export under AGOA.
but must notify Congress 60 days before any termination.
https://crsreports.congress.gov
African Growth and Opportunity Act (AGOA)
IF10149
Brock R. Williams, Analyst in International Trade and
Finance
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https://crsreports.congress.gov | IF10149 · VERSION 13 · UPDATED