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1 1 (May 5, 2023)

handle is hein.crs/govelne0001 and id is 1 raw text is: Afri Congressional Research Service S Informing Ihe 1911atve debat sice 1914 African Growth and Opportunity Act (AGOA) Overview What is AGOA? AGOA (P.L. 106-200, as amended), a cornerstone of U.S. trade policy toward sub-Saharan Africa since 2000, is a nonreciprocal U.S. trade preference program that provides duty-free access to the U.S. market for most exports from eligible sub-Saharan African countries. In addition to preferential market access, the act also requires an annual forum, known as the AGOA forum, held between U.S. and AGOA country officials to discuss trade-related issues. Additionally, AGOA provides direction to select U.S. government agencies regarding their trade and investment support activities in the region. Which countries are eligible? AGOA lists 49 sub-Saharan African countries that are potential candidates for program benefits. AGOA eligibility criteria address issues such as trade and investment policy, governance, worker rights, and human rights, among other issues, which countries must satisfy to be beneficiaries of the program. The President annually reviews and determines each country's eligibility. There are currently 35 AGOA-eligible countries. In November 2022, President Biden terminated AGOA preference benefits for Burkina Faso, effective January 1, 2023, after determining that it failed to meet the rule of law eligibility criteria. The President also terminated preference benefits for Ethiopia, Guinea, and Mali for failing to meet eligibility requirements regarding human rights (Ethiopia, Mali), political pluralism and the rule of law (Guinea, Mali), and worker rights (Mali) in December 2021. Ten other sub-Saharan African countries remained ineligible for the program's preference benefits in 2022. They are (with noted eligibility violations) Burundi (political violence), Cameroon (human rights), Equatorial Guinea (income graduation), Eritrea (human rights), Mauritania (worker rights), Seychelles (income graduation), Somalia (never eligible), South Sudan (political violence), Sudan (never eligible), and Zimbabwe (never eligible). 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. The African Growth and Opportunity Act and Millennium Challenge Act Modernization Act of 2018, P.L. 115-167, required the Administration to provide information on AGOA through an official AGOA website, promote AGOA utilization, product diversification, and regional cooperation, and educate African entrepreneurs. What is the goal? Through AGOA, the U.S. Congress seeks to increase U.S. trade and investment with the region, Updated May 5, 2023 promote sustainable economic growth through trade, and encourage the rule of law and market-oriented reforms. Supporting views. Supporters of AGOA argue that the program affords African producers an important competitive advantage in the U.S. market, thereby enabling exports, encouraging investment in the region, boosting private sector activity and economic growth, and ultimately generating demand for U.S. goods and services as the region's economies develop. Opposing views. Opposition is mostly from U.S. producers that may face increased import competition from AGOA countries. Such concerns are generally limited due to the low volume of U.S. imports under AGOA, but import competing U.S. producers have lobbied to keep certain products, particularly sugar, out of the program. U.S. Imnports Un der AGQA Total U.S. AGOA imports were $9.4 billion in 2022, up 57% from $6.0 billion in 2021 and more than double 2020 values, which was the height of the Coronavirus Disease- 2019 pandemic. Imports remain concentrated in a few countries and industries, but diversification has grown. Figure I.Top AGOA Countries, Non-Energy Products South Africa Kenya Madagascar Lesoth Ghana 02022 Other s2021 in milions i SKo 1,_0 1 Soo 2,o 2,soo 3,00 3,s5o Source: Analysis by CRS. Data from USITC. Energy product imports (e.g., crude oil) increased from $1.9 billion in 2021 to $4.5 billion in 2022, and accounted for 47% of AGOA imports. It remains lower than the 2011 peak value of $48 billion. Nigeria was the top supplier of energy products in 2022 ($3.4 billion). AGOA non-energy imports increased by 21% in 2022 to $5.0 billion. Top non-energy import categories include motor vehicles ($1.5 billion), textile and apparel ($1.4 billion), agricultural products ($679 million), metals ($626 million), and chemicals ($286 million). South Africa is the top supplier of AGOA non-energy imports (Figure 1), with eligible imports increasing 46% from 2021 to 2022, partly driven by higher motor vehicle imports. Imports from Madagascar increased by 45%, making the country the third-largest AGOA beneficiary of non-energy imports.

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