Ideas to Action:

Independent research for global prosperity

Share

When President Obama hosts some four dozen heads of state from sub-Saharan Africa next week, enhancing US-Africa trade and investment ties will be high on the agenda. At the center of US economic policy towards Africa is the African Growth and Opportunity Act (AGOA), and the administration decided to fold the annual AGOA forum, in condensed form, into the leaders’ summit. There will also be a US-Africa Business Forum on day two of the summit with the stated aim of “strengthening trade and financial ties.” So it would be surprising if the President does not address AGOA’s future.

Here are two steps the President could take during the leaders’ summit to put some substance behind all the talk about trade and investment:

  1. Announce that it is a priority to extend AGOA well before it expires next year, and to do so for at least a decade. While AGOA has broad bipartisan support in Congress, so does the Generalized System of Preferences program, which provides preferential market access to all developing countries. Yet that program remains in limbo more than a year after it lapsed. To avoid a similar outcome for AGOA, the president should begin publicly pushing for an extension now.
  2. Use his executive authority and provide new market opportunities for African agricultural products that remain restricted under AGOA. Taking this action would have minimal, if any, impact on US producers while helping to create jobs in rural areas where most of the African poor reside. I explain how he could do that here.

In addition to these two steps to improve AGOA, my colleagues Ben Leo and Vijaya Ramachandran propose other ways that the United States could promote African competitiveness and capacity to trade here. And, in a sign that Congress wants to extend and improve AGOA, the House Ways and Means Trade Subcommittee invited Ben to testify at a hearing on the topic tomorrow.  Lots of talk about AGOA; let’s hope we see some action as well, and soon.