South Africa has asked the US government to consider an early extension of the African Growth and Opportunity Act (AGOA), to help stimulate investment across the continent, according to Trade, Industry and Competition Minister Ebrahim Patel.
The request was made during a visit by South African officials to the US earlier this month, to discuss the trade pact and finalise preparations for an AGOA forum that’s scheduled to be hosted in South Africa this year. An early renewal of AGOA in its current form would be preferable to a revised agreement that may take time to conclude, Patel said in an interview with the Johannesburg-based Business Day newspaper.
‘If we extend AGOA largely in its current form, we can incrementally improve the terms over the next few years. Many African countries are keen on an early extension because it gives investors certainty to commit additional investment on the continent.’
The plea comes after several US lawmakers called on President Joe Biden’s administration to reconsider whether South Africa should even continue to benefit from AGOA. The US has been angered over South Africa’s foreign policy stance (its non-aligned position toward Russia’s invasion of Ukraine), ̶̶̶̶and they argue that South Africa is too developed to participate in the programme.
AGOA expires in 2025, and US officials have said the qualifying criteria for beneficiaries could be revised or the programme replaced.
South Africa ships cars and agricultural produce to the US under the accord. Last year, it exported $2.7 billion of goods using AGOA and the so-called Generalized System of Preferences.