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Dec
19

This means that South Africa can no longer rely on AGOA as the centrepiece of its economic partnership with the United States. AGOA is not a negotiated and reciprocal agreement: it is an American initiative that does not grant reciprocal trade preferences to African countries. The United States may arbitrarily suspend its benefits or withdraw them from participating nations. Former Nigerian President Olusegun Obasanjo told Kigali media: “This is where our salvation lies: trade between them and therefore the development of our economies. This agreement will lead to a change in the perception of the continent by the rest of the world. But U.S. trade policy towards South Africa is changing. This is underlined by the fact that, although the United States has incorporated South Africa into the revised AGOA, it has done so under strict conditions. This included the provision that South Africa`s trade and investment policy should be reviewed within 30 days of the implementation of AGOA. If the audit reveals that the South African market is not sufficiently open to U.S. products, the United States could restrict agoA`s benefits in South Africa or suspend its participation in the regime.

It is significant that the revised AGOA did not foresee any improvement in the access of South African products to the U.S. market. The advantage of preferential trade agreements is that they can bring about lasting structural changes. After 18 years in which agoA benefited eging, a predictable general balance analysis from the World Bank in 2018 showed that the termination of AGOA by 2020 would result in a 1% revenue loss and a 16 per cent decline in the textile and clothing industry. But simulations have also shown that trade facilitation measures, which reduce the average cost of trade by 2% per year, would eliminate the negative income effects resulting from the elimination of AGOA. AGOA`s protection of the child industry has allowed the industry to grow and prosper, so that a reduction in trade costs of only 2 per cent would allow it to maintain its competitiveness. U.S. President Donald J.

Trump announced today that the United States will begin negotiations on trade agreements with the Republic of Kenya after a meeting at the White House with Kenyan President Uhuru Kenyatta. “Kenya is a recognized leader across the continent, an important strategic partner of the United States, and there is enormous potential for us,… The South African Customs Union consists of Botswana, Lesotho, Namibia, South Africa and Swaziland: five neighbouring states, with a population of 51.9 million people, covering 1.7 million square miles at the southern tip of the African continent. Although this figure represents less than 1% of the population of sub-Saharan Africa, SACU accounts for half of the subcontinent`s gross domestic product (GDP). There are big differences between SACU`s economies. While South Africa has developed significant production and industrial capacity, other countries remain dependent on agriculture and mining. The grouping is dominated by South Africa, which accounts for 87% of the population and 93% of the CUSTOMS territory`s GDP. In 2005, SACU Member States had a real GDP of about $158 billion.

U.S. imports for consumption, expressed in customs value; U.S. domestic exports as SAV (next to the ship) value. There are several possible reasons for negotiating a free trade agreement with SACU. A impetus comes from Article 116 of the African Growth and Opportunity Act (AGOA) (Title I, P.L. 106-200), in which Congress stated that free trade agreements should be negotiated with sub-Saharan Africa to serve as a catalyst for U.S. private sector trade and investment in the region. Such trade and investment could stimulate economic growth in southern Africa by creating new jobs and wealth. SACU member countries recorded the strongest export growth under AGOA and a free trade agreement could expand their access to the U.S. market. A free trade agreement could also