Sub-Saharan Africa’s non-oil exports to U.S. skyrocket

The Office of the U.S. Trade Representative released a report Wednesday, which showed that sub-Saharan Africa’s non-oil exports to the United States have dramatically increased since the implementation of the African Growth and Opportunity Act in 2000.    The Office of the U.S. Trade Representative on Wednesday released a report stating that sub-Saharan Africa’s non-oil exports to the United States reached $4.1 billion in 2015, a three-fold increase since the Oct. 1, 2000 implementation of the African Growth and Opportunity Act (AGOA).
   Thirty-eight of the 49 sub-Saharan African countries currently participate AGOA, which significantly reduces U.S. tariffs on numerous products from these countries to encourage and promote their economic development.  
   “AGOA is a vital part of that relationship and, with the historic 10-year renewal of the program now in place we look forward to working with sub-Saharan African countries to maximize AGOA utilization and to begin exploring a path for a long-term, predictable, and mutually beneficial U.S.-Africa trade relationship beyond AGOA,” said U.S. Trade Representative Michael Froman in a statement, highlighting the release of USTR’s 89-page 2016 Biennial Report on the Implementation of the African Growth and Opportunity Act.
   The report is mandated by Congress under the 2015 Trade Preferences Extension Act to be submitted one year following the enactment of the Act, and biennially thereafter.  
   AGOA has stimulated increases of non-oil-based exports such as autos and parts, apparel, fruits and nuts, cocoa, prepared vegetables, footwear, and cut flowers from sub-Saharan Africa (SSA). “However, total SSA exports to the United States declined slightly in 2015 due to falling oil and other commodity prices,” USTR said.
   U.S. exports to sub-Saharan Africa, on the other hand, totaled $17.8 billion in 2015, up 202 percent compared to 2000, and U.S. investment stock in sub-Saharan Africa stood at $34.4 billion in 2014 compared to $9 billion in 2001. 
   “As African leaders intensify efforts to increase regional integration and link together their markets, U.S. companies are taking advantage of these larger markets that make trade and investment more attractive on the continent,” USTR said. “Under African Union leadership, a number of African regional economic communities are moving toward regional and Africa-wide trade and economic integration to promote both continent-wide trade as well as greater engagement in the global trading system.”
   Another USTR report released Wednesday stated AGOA, in addition to the Generalized System of Preferences (GSP) and Caribbean Basin Economic Recovery Act (CBERA), as also continued by the 2015 Trade Preferences Extension Act, provided duty-free treatment to about $27 billion of goods from 126 beneficiary countries and territories. “This accounted for about 1.3 percent of the United States’ $2.2 trillion in total goods imports, and 13 percent of the $212 billion in all goods sourced from the beneficiary countries,” USTR said.
   “Preferences are of crucial importance to a number of least-developed countries which do not as yet have the capacity to negotiate and implement comprehensive FTAs,” USTR explained.
   For example, the Philippines, which has been a GSP beneficiary since 1976, was the fifth largest user of the program behind India, Thailand, Brazil and Indonesia, exporting $1.4 billion to the United States in 2015 under GSP, or about 13 percent of its overall exports to the United States.
   “U.S. imports from the Philippines under GSP have increased 49 percent since 2010, while total U.S. imports from the Philippines have increased only 28 percent. The Philippines has expanded and diversified the number of products it exports to the United States under GSP, counting more than 580 products in 2015. Leading GSP imports from the Philippines include automobile tires, telescopic sights, measuring and checking instruments, certain coconut waters, and appliances and machines,” the report said.
   Handicrafts, such as jewelry, from GSP-eligible countries also benefit significantly from the duty-free access to the U.S. market. “In 2015, 42 GSP beneficiary countries exported jewelry under GSP, with 16 of those countries exporting more than $1 million worth of jewelry products. In total, U.S. imports of jewelry (classified under HTS [Harmonized Tariff Schedule] Chapter 71) under GSP totaled $529 million in 2015, representing 3 percent of the $27 billion in total GSP imports from all beneficiary countries,” USTR said.