A new report from the International Trade Commission examines the impact of the African Growth and Opportunity Act in general and on select industries and beneficiary countries.
House Ways and Means Ranking Member Richard Neal, D-Mass., who requested the report when he chaired the committee last year, said it will help inform the committee’s deliberations as it considers AGOA’s future. “AGOA has not achieved all that we had hoped,” he said. “Not only should we find creative ways to improve AGOA’s utilization rates, increase value-added exports to the U.S., and ensure that benefits actually flow to the African countries, but we should take a holistic approach to deepening our trade and investment relationship” with Africa that includes issues like improving healthcare, protecting the environment, incentivizing investment, and ensuring that all segments of the economy benefit from that relationship.
AGOA – first enacted in 2000 and currently in effect through Sept. 30, 2025 – grants duty-free access to products imported from qualifying sub-Saharan Africa countries. About 85 percent of all tariff lines are eligible for duty-free access to the U.S. if imported from any AGOA beneficiary, a figure that increases to about 97 percent for beneficiaries with full textile and apparel product benefits (which in 2022 included 24 of 36 countries). At least 35 percent of a product’s value must be grown, produced, or manufactured in the AGOA-eligible country, and exports must be directly shipped to the U.S. Different rules of origin apply concerning the sourcing of inputs for textile and apparel products.
The ITC’s report assesses trends and utilization rates over the life of the program as well as its impacts on regional integration, workers, underserved communities, economic development, job growth, and poverty reduction. The report also includes case studies on the cotton, apparel, chemicals, and cocoa industries, including an analysis of each industry’s competitive strengths and weaknesses.
Highlights of the report’s findings include the following.
- AGOA’s impact on regional integration, workers, underserved communities, and economic development in beneficiary countries appears to be minimal outside of certain countries and sectors, though assessing this impact is challenging given that so many factors can influence these outcomes.
- Less than one percent of total U.S. imports by value (about $6.8 billion in 2021) enter under AGOA, and this level has been steady in current dollars since the program’s inception.
- Crude petroleum has historically dominated trade under AGOA; textiles and apparel was the largest value-added sector in 2021, accounting for 33 percent of non-crude petroleum imports; and other low- and medium-technology industries such as copper cathodes and gold jewelry accounted for significant volumes of trade.
- More than 75 percent of non-crude petroleum imports under AGOA originated from five countries during 2014–21: South Africa, Kenya, Lesotho, Madagascar, and Ethiopia.
- The overall AGOA utilization rate (i.e., the rate at which U.S. imports of AGOA-covered products from an AGOA beneficiary claim the AGOA preference) reached 85 percent in 2021 but varied substantially by country. For non-crude petroleum products, 24 of 39 eligible countries had utilization rates greater than 50 percent.
- Countries with higher utilization rates have sectors subject to the highest U.S. tariff rates, exports aligned with AGOA-eligible products, eligible exports in amounts greater than $1 million, and national AGOA strategies. Countries with lower utilization rates typically have few exports to the U.S. in general, or their primary traded goods are not eligible for AGOA preferences or are already duty-free under normal trade relations.
- While there remains little direct usage of SSA-grown cotton and a reliance on East Asian mills for yarn and fabric, there are some limited examples of regional integration connecting SSA producers of textile inputs to apparel manufacturers.
- Agricultural products like cotton and cocoa are important sectors for a number of SSA economies. Cocoa processing operations allow the export of higher value commodities like cocoa butter and powder, but growing cotton and cocoa provides low income and therefore does not provide a reliable pathway for poverty reduction.
- Despite the region’s access to ample feedstocks, the chemical industry’s potential impact is limited and substantial development will likely depend on mitigating competitive infrastructure weaknesses.
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