The Expiration Of The AGOG Bill May Affect The Export Of African Shoes And Clothing To The United States.

The African Growth and Opportunity Act (AGOA) was first proposed by the US House of representatives in April 1997 and passed by the US House of representatives in May 4, 2000. The African Growth and Opportunity Act (AGOA) provides unilateral trade preferences for 48 sub Saharan African countries (hereinafter referred to as "Black Africa"). All African countries that meet the AGOA conditions can export 4650 kinds of commercial goods to the United States within the specified years. The most significant beneficiaries of AGOA arrangement are textiles and clothing, of which 5 categories are tariff free and quota free.

The US law is designed to replace direct assistance through trade preferences. However, the law is about to expire next year, in which case companies from African countries exporting to the United States will be affected. However, the United States also said it would provide a package of trade preferences to African countries.

The Kenya Business Daily reported on May 1st that the United States opened the window for commodity tax exemption exports to many African countries ten years ago, thus attracting 1 billion 234 million new investment in shillings and creating a large number of jobs.

The Kenya export processing zone (EPZ) is established and operated in accordance with the African Growth and Opportunity Act. The economic survey in 2014 showed that the investment volume attracted by the export processing zone enterprises increased by 11.5%, from 10 billion 732 million shillings last year to 11 billion 966 million shillings.

At present, there are 81 companies in the export processing zone, of which 22 companies specialize in the commodities designated for export in the African Growth and Opportunity Act. At present, the value of orders received by these companies from the US market is 24 billion shillings.

In accordance with the relevant provisions of the third countries' textile raw materials, if the countries enjoying the African Growth and Opportunity Act, such as Kenya, do not have enough textile raw materials, they will be able to make garments and export to the United States with imported textile materials and enjoy tax exemption.

Clothing and textiles account for more than 90% of Kenya's exports that enjoy the preferential treatment of the bill.

The purpose of implementing the law in the United States is to replace direct assistance through trade preferences. However, the 15 year implementation period of this law will end next year. To this end, various export enterprises have taken action to try to win the United States to carry out this law.

However, at the recent Origin Africa Expo exposition, US officials disclosed the possibility of more preferential trade policies in the US.

The African Growth and Opportunity Act came into effect in October 2000. The bill provides unilateral trade preferences for 48 sub Saharan African countries, and 37 eligible countries can export thousands of goods to the United States free of duty according to the GSP. The law will expire in 2015.

The US government said that under the framework of the African Growth and Opportunity Act, the United States imported a lot of clothing, footwear and processed agricultural products and other manufactured goods from African countries in the non oil field, which effectively promoted the development of African economy.