Q:
How does AGOA benefit African countries?
Q:
How does it benefit U.S. firms?
Q:
Why the need for an AGOA II bill?
Q:
What specific changes did the AGOA II legislation make to
the original AGOA law?
Q:
What specific changes did the AGOA Acceleration Act of 2004
make to the original AGOA law?
Q:
What specific changes did the Africa Investment Incentive
Act of 2006 (AGOA IV) make to the original AGOA law?
Q:
What is the "Abundant Supply" provision?
Q:
What benefits are provided for Botswana and Namibia?
Q:
What conditions are placed on participation by African countries?
Q:
Which countries have been designated as AGOA eligible?
Q:
Does the United States have the right to set eligibility criteria
for African countries?
Q:
What are the provisions governing apparel imports?
Q:
Which countries fall under the per capita GNP ceiling for
the Special Rule?
Q:
When do the apparel benefits take effect?
Q:
What does the term "knit-to-shape" mean?
Q:
What are the Acts GSP provisions?
Q:
How can African countries become more familiar with the benefits
of the Act?
Q: How does AGOA benefit African countries?
A: AGOA passed as part of The Trade and Development Act of
2000 provides beneficiary countries in Sub-Saharan Africa
with the most liberal access to the U.S. market available
to any country or region with which we do not have a Free
Trade Agreement. It reinforces African reform efforts, provides
improved access to U.S. credit and technical expertise, and
establishes a high-level dialogue on trade and investment
in the form of a U.S.-Sub-Saharan Africa Trade and Economic
Forum. (back to top)
Q: How does it benefit U.S. firms?
A: By creating tangible incentives for African countries to
implement economic and commercial reform policies, AGOA contributes
to better market opportunities and stronger commercial partners
in Africa for U.S. companies. The Act should help forge
stronger commercial ties between Africa and the United States,
while it helps to integrate Africa into the global economy.
U.S. firms may find new opportunities in privatizations of
African state-owned enterprises, or in partnership with
African companies in infrastructure projects. (back
to top)
Q:
Why the need for an AGOA II bill?
A:
The need for AGOA II legislation was developed in part to
improve upon and clarify some of the specific provisions that
were not addressed in the original AGOA legislation (or AGOA
I). AGOA II is part of the Trade Act of 2002 which President
Bush signed into law on August 6, 2002. (back
to top)
Q:
What specific changes did the AGOA II legislation make to
the original AGOA law?
A:
Click here to view a
table comparing AGOA I and AGOA II. (back
to top)
Q:
What specific changes did the AGOA Acceleration Act of 2004
make to the original AGOA law?
A:
Click
here to view a summary of the AGOA Acceleration Act of 2004.
(back
to top)
Q:
What specific changes did the Africa Investment Incentive
Act of 2006 (AGOA IV) make to the original law?
A:
Click
here to view a summary of the Africa Investment Incentive
Act of 2006 (AGOA IV). (back
to top)
Q:
What is the "Abundant Supply" provision?
A:
AGOA IV provides for special rules for fabrics or yarns produced
in commercial quantities (or "abundant supply")
in any designated sub-Saharan African country for use in qualifying
apparel articles. Upon receiving a petition from any interested
party, the International Trade Commission will determine the
quantity of such fabrics or yarns that must be sourced from
the region before applying the third country fabric provision.
It also provides for 30 million square meter equivalents (SMEs)
of denim to be determined to be in abundant supply beginning
October 1, 2006. The U.S. International Trade Commission will
provide further guidance on how it will implement this provision.
(back
to top)
Q:
What benefits are provided for Botswana and Namibia?
A:
AGOA II permits Botswana and Namibia to qualify for the "Special
Rule," which permits lesser developed AGOA beneficiary
countries to utilize fabric manufactured anywhere in the world
(extended until September 30, 2007 under AGOA III). Since
Botswana's and Namibia's per capita GNP exceeded $1,500 (the
1998 World Bank level), they were not designated as a lesser
developed beneficiary country and were not eligible for the
Special Rule under the original AGOA legislation. The Africa
Investment Incentive Act of 2006 (AGOA IV) continues to grant
lesser-developed beneficiary country status to Botswana and
Namibia, qualifying both countries for the Special Rule. While
an amendment to the AGOA Acceleration Act of 2004 granted
lesser-developed beneficiary country status to Mauritius,
AGOA IV did not continue to grant Mauritius lesser-developed
beneficiary country status. (back
to top)
Q:
What conditions are placed on participation by African countries?
A: The President may designate Sub-Saharan African countries
as eligible to receive the benefits of the Act if they are
making progress in such areas as: establishment of market-based
economies; development of political pluralism and the
rule of law; elimination of barriers to U.S. trade and investment;
protection of intellectual property; efforts to combat corruption;
policies to reduce poverty, increase availability of health
care and educational opportunities; protection of human
rights and worker rights, and elimination of certain practices
of child labor. Progress in each area is not a requirement
for AGOA eligibility. (back to top)
Q: Which countries have been designated as AGOA
eligible?
A: Click
here for a list of AGOA eligible countries. (back
to top)
Q: Does the United States have the right to set
eligibility criteria for African countries?
A: The criteria are standards which the Africans themselves
have espoused and most are striving to uphold. But Congress
never intended AGOA to be a blank check for all African countries,
without regard to performance. It was meant to offer
tangible incentives for African governments to improve their
political and economic governance, not to underwrite poor
policies. (back to top)
Q: What are the provisions governing apparel
imports?
A: AGOA provides duty-free and quota-free treatment for eligible
apparel articles made in qualifying sub-Saharan African countries
through 2015. Qualifying articles include: apparel made of
U.S. yarns and fabrics; apparel made of sub-Saharan African
(regional) yarns and fabrics until 2015, subject to a cap;
apparel made in a designated lesser-developed country of third-country
yarns and fabrics until 2012, subject to a cap; apparel made
of yarns and fabrics not produced in commercial quantities
in the United States; textile or textile articles originating
entirely in one or more lesser-developed beneficiary sub-Saharan
African countries; certain cashmere and merino wool sweaters;
and eligible handloomed, handmade, or folklore articles, and
ethnic printed fabrics. Under a Special Rule for lesser-developed
beneficiary countries, those countries with a per capita GNP
under $1,500 in 1998, will enjoy an additional preference
in the form of duty-free/quota-free access for apparel made
from fabric originating anywhere in the world. The Special
Rule is in effect until September 30, 2012 and is subject
to a cap. AGOA IV continues the designation of Botswana and
Namibia as lesser-developed beneficiary countries (click
here for further details on apparel eligibility provisions).
(back to top)
Q: Which countries fall under the per capita
GNP ceiling for the Special Rule?
A: All Sub-Saharan African countries meet the per capita GNP
requirements of the Special Rule with the exception of the
following: Botswana, Gabon, Mauritius, Namibia, Seychelles,
and South Africa. However, countries must meet the general
AGOA eligibility requirements and the requirements for apparel
benefits in order to qualify for the Special Rule. AGOA II
grants Lesser Developed Beneficiary Country status to Botswana
and Namibia, qualifying both countries for the Special Rule.
The Africa Investment Incentive Act of 2006 (AGOA IV)
continues to grant lesser-developed beneficiary country status
to Botswana and Namibia. (back
to top)
Q: When do the apparel benefits take effect?
A: Although the apparel benefits take effect October 1, 2000,
beneficiary countries must first have an effective visa system
in place to prevent illegal transshipment and use of counterfeit
documentation. They must also institute enforcement
and verification procedures. Details were disseminated to
African governments following a cable instruction to all U.S.
embassies in Sub-Saharan Africa on September 21, 2000. Countries
must also be beneficiary developing countries under
the U.S. Generalized System of Preferences (GSP), which includes
45 Sub-Saharan African countries. (back
to top)
Q:
What does the term "knit-to-shape" mean?
A:
Components that take their shape in the knitting process,
rather than being cut from a bolt of cloth. (back
to top)
Q:
What are the Act’s GSP provisions?
A: AGOA authorizes the President to provide dutyfree treatment
under GSP for any article, after the U.S. Trade Representative
(USTR) and the U.S. International Trade Commission (USITC)
have determined that the article is not importsensitive
when imported from African countries. On December 21,
2000, the President extended duty-free treatment under GSP
to AGOA eligible countries for more than 1,800 tariff line
items in addition to the standard GSP list of approximately
4,600 items available to non-AGOA GSP beneficiary countries.
The additional GSP line items which include such previously
excluded items as footwear, luggage, handbags, watches, and
flatwarewere implemented after an extensive process
of public comment and review. Sub-Saharan African GSP
beneficiary countries are also exempted from competitive need
limitations. In order for any Sub-Saharan African country
to receive the liberalized GSP benefits it must first be GSP
eligible under the existing criteria of that law.
GSP is extended for Sub-Saharan African beneficiary countries
until September 30, 2015. (back to
top)
Q: How can African countries become more familiar
with the benefits of the Act?
A: The U.S. Government has conducted technical assistance
seminars in Africa and the United States to explain the benefits
of the Act, in order to ensure that African countries are
able to take maximum advantage of its provisions. (back
to top)
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