Expert: AGOA makes political, economic sense for SA and US
Wits University’s International Relations expert, John Stremlau, says South Africa stands to benefit economically and politically from the African Growth and Opportunity Act (AGOA).
A 3-day summit on trade relations between Africa and the United States kicked off in Johannesburg on Thursday.
The two countries are on a path to mending relations following explosive accusations that South Africa supplied weapons to Russia amid the war in Ukraine.
In May, US Ambassador to South Africa Reuben Brigety accused South Africa of providing weapons and ammunition to Russia.
An independent panel appointed by President Cyril Ramaphosa found there to have been no truth to the allegations.
Ministers from several sub-Saharan African countries who are part of AGOA have gathered in South Africa to hold talks with their US counterparts.
Stremlau says South Africa is more than qualified to host the AGOA Summit and hopes it continues for another decade.
“South Africa fulfils all of the basics for rule of law, pluralism, periodic elections, so it’s really a no-brainer for the US to have it here. There are policy differences over Ukraine and, to an extent, over the Middle East crisis, but I don’t think those are going to weigh heavily. I think this is largely the 20th forum of this kind, and I hope that they renew it for another 10 years”.
“It’s a (US) congressional action; it’s not a trade agreement as we understand trade agreements, but it’s a concession that the president recommends and the congress usually passes.”
Approved by the US Congress in 2000, AGOA is the cornerstone of US economic and trade policy on the continent.
The pact offers duty-free access into the world's largest economy for countries that meet democratic criteria assessed on a yearly basis.
It ends in 2025, and with little plan yet for any successor, talks are expected to revolve around a possible extension.
“The relevance of AGOA is that for US-SA relations, it gives incentive to the Mercedes-Benz C Class being imported to the United States for duty-free, and there is a whole host of products that go from the agriculture to manufacturers into the US markets so that we have a $25 billion a year trading partnership but it’s $10 billion advantage for SA and a surplus for South Africa in contrast to the China trade, which is a surplus to China,” says Stremlau.
“It aims to assist both the extension of trade and also the development of the African economies. With 40 million African Americans in the political system in the United States, they are an important voting block. So, it makes good political sense and economic sense.”
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