US President Elect Donald Trump has made it clear that his main focus is America; its people and its economic growth. Outlining his policies as president, Trump has vowed to negotiate fair trade deals that create American jobs. He has also promised to quit the Trans-Pacific Partnership introduced by Barack Obama on his first day in office and renegotiate the North American Free Trade Agreement (NAFTA), calling it the “worst trade deal ever signed”.
It is NO secret, Trump really hates trade deals
Should Africa worry over the African Growth and Opportunity Act (AGOA), a trade agreement between the US and 38 sub-Saharan African countries to export to America duty-free which was recently renewed for another 10 years under President Barak Obama’s administration?
Some commentators and analyst speculate that Trump’s administration will spell trouble for Agoa, Maudi Lentsone, Managing Director at Lehumo Capital says although it is still premature to be commenting of what’s to be expected, it is unlikely that Trump would scraps the Agoa trade deal completely, saying, “I am of the view that Agoa will NOT be under threat”.
Lentsoane says one of the reasons Agoa came into being was for the US to have a slice of the cake that is Africa in the market place. For years Europe and China were Africa’s key trade partners.
Countries like Lesotho, Kenya, Ghana, Mauritius, and Angola have benefitted from AGOA, with South Africa accounting for the bulk of U.S. imports under AGOA with trade totalling over R290 billion between the two countries.
Overview of Trade between the US and Sub-Saharan Africa since Agoa’s inception in 2000
SOURCE: agoa.info | accessed on 24/11/16
AGOA was initially signed into law by then President Bill Clinton in 2000 with the objective of expanding U.S. trade and investment with sub-Saharan Africa, to stimulate economic growth, to encourage economic integration, and to facilitate sub-Saharan Africa’s integration into the global economy.
U.S. imports from AGOA beneficiary countries represent a small share of about 2% of total U.S. imports and are largely concentrated in energy-related products.
Although Donald trump has NOT said anything about the continent, it is a game of wait and see. Will Agoa go or stay.
By Ntsoaki Shoeshoe Qhu