The reauthorization of the African Growth and Opportunity Act (AGOA) presents a critical opportunity for Congress to support workers in the United States and Africa, diversify supply chains, and protect the climate. With AGOA’s authorization set to lapse in 2025, it is essential for Congress to consider improvements to the preferential trade program that reflect changes in economic conditions, climate concerns, and the needs of workers on both continents. Since AGOA’s enactment in 2000, supply chains have become more interconnected, and the link between trade flows and climate change has become clearer. Strengthening AGOA can enhance U.S. competitiveness and foster sustainable development in Africa.
One of AGOA’s major challenges is its uneven utilization among beneficiary countries and sectors. As of June 2024, 32 countries benefit from AGOA, but utilization rates vary significantly. Countries like Kenya and Lesotho have high utilization rates due to their strong textile and apparel industries. In contrast, many other beneficiaries struggle to produce AGOA-eligible goods, resulting in low utilization rates. This uneven distribution of benefits limits AGOA’s potential impact. Furthermore, AGOA’s focus on oil and gas exports, which accounted for $4.2 billion of a total $9.7 billion in imports in 2023, does not align with global climate goals and fails to support broader economic development.
To maximize AGOA’s benefits, Congress must address these utilization disparities and reduce the dominance of fossil fuels. This requires direct investment in African productive capacity, infrastructure, and communities, as well as an increase in U.S. personnel to help American manufacturers partner with new AGOA-eligible suppliers. For example, African critical mineral producers could supply U.S. manufacturers of electric vehicles and semiconductors, but this will require investment in African mining and processing capabilities. Ensuring that AGOA benefits both African and U.S. workers also means updating labor provisions and environmental standards to reflect 21st-century realities.
Implementing high standards for labor and environmental practices is crucial for AGOA’s success. Congress should strengthen AGOA’s rules-of-origin requirements and include environmental provisions in its eligibility criteria. This can help ensure that the benefits of AGOA support sustainable development and decent work. Developing national utilization strategies has proven effective in countries like Zambia, which saw a significant increase in AGOA exports after introducing a strategy in 2016. Congress should provide development funds to help all AGOA-eligible countries create and implement such strategies, with a focus on exporting goods that meet U.S. manufacturers’ needs.
Expanding engagement and technical assistance is vital for AGOA’s future. Congress should fund a significant expansion of the Foreign Commercial Service (FCS) footprint in sub-Saharan Africa and task new staff with helping African exporters utilize AGOA and U.S. manufacturers find new supply chain partners. Additionally, reauthorization should include a multibillion-dollar appropriation to support investments by the U.S. International Development Finance Corp. and other agencies in African industries. This would demonstrate the United States’ commitment to AGOA and its potential to deliver positive results for both climate and workers in the U.S. and Africa.
Reauthorizing AGOA offers an opportunity to align the program with contemporary economic, environmental, and social needs. Simply reauthorizing AGOA unchanged will not achieve its full potential. Congress must pair reauthorization with significant investments and higher standards to ensure AGOA supports sustainable development, decent work, and climate goals. By doing so, AGOA can become a powerful tool for fostering economic growth and competitiveness in both the United States and Africa.
