Bipartisan US senators introduce Agoa bill to renew trade pact to 2041

Washington — A bipartisan group of senators will introduce a bill to renew the US’s trade pact with Sub-Saharan Africa ahead of its expiration next year, an aide to one of the senators said on Thursday.

A cross-party group of senators are co-sponsoring the bill, which is being introduced by senators Chris Coons, a Democrat, and James Risch, the top Republican on the Senate foreign relations committee.

An aide to Coons said it was a high priority to renew the African Growth and Opportunity Act (Agoa) this year. The bill would renew the trade pact to 2041 and help countries implement strategies to take advantage of trade benefits. It encourages African countries to adopt market-based economies, support democracy and protect due process and the rule of law.

It would also enable countries to remain in the programme if they are determined to have reached a high-income status over five years rather than removing them if they reach that threshold after a single year.

Under the bill, countries would be reviewed for eligibility every second year, instead of annually under the current statute, but the US president and certain congressional leaders could at any point review countries’ eligibility out of cycle.

If countries were found to be ineligible for the programme, the president would have a menu of options for enforcement, ranging from full termination of benefits to taking no action. Current statute requires the president to terminate Agoa benefits if a country does not meet eligibility.

A draft of the bill introduced by Coons last November mandated an immediate out-of-cycle review for SA, one of the biggest beneficiaries of Agoa, but it is not included in this version. An aide to Coons said it was viewed as unnecessary to single out a particular country as the bill already allows for out-of-cycle reviews, but senators remain concerned about SA's activities.

US President Joe Biden has said he supports the reauthorisation of the trade pact, which was initially enacted in 2000 and expires in 2025. More than $10bn of African exports entered the US duty-free under the programme in 2022, according to the US trade representative’s office.

American business groups have said they need certainty about Agoa for African countries to take advantage of global efforts to lower dependence on Chinese manufacturing.

Aides to Senate Democratic leader Chuck Schumer and Senate foreign relations chair Ben Cardin did not immediately respond to requests for comment.

Reuters