U.S.–African Relations in the Era of Strategic Competition and the future of the AGOA

Introduction to the AGOA

The African Growth and Opportunity Act, also known as AGOA, was introduced by Congressman Jim McDermott, who is associated with the Democratic Party, and Congressman Ed Royce, who is a member of the Republican Party (Congressional Research Service, 2024) making it a rare bipartisan plan. The African Growth and Opportunity Act is a system that offers Sub-Saharan African Countries a chance for economic development on a regional and international scale along with better institutional governance. Its creation was a momentous move, heading away from offering purely aid and steering towards more investment-based procedures. The AGOA was first signed into action in 2000, and since then has been one of the most important trade agreements for the United States (United States Trade Representative, n.d.-a).

Eligibility Requirements for Countries to Join the AGOA

As of today, there are thirty-two countries qualified for the AGOA, but in order for these countries to be eligible, they are required to meet certain criteria. They must be working towards building a market economy by creating intellectual property and copy right laws, and form political pluralism, in which they will have more than one party in the government and party variety for their citizens (United States Trade Representative, n.d.-a). These countries are also required to form just and unbiased laws to assist in fighting against corruption, along with making laws or policies that help decrease poverty for their people (Congressional Research Service, 2024).

They must construct laws that protect human rights such as life and liberty, along with laws that limit the government, making the government unable to take action against one's citizens without informing them with reason, mirroring the idea of "innocent until proven guilty." These states must follow the rule of law (United States Customs and Border Protection, n.d.), meaning the governments of these states must abide by the laws that they set for their citizens.

Through these required standards, the program potentially punishes those who do not meet them by withholding the allowance to participate, but this is done in order to encourage these countries to put in an effort to fight corruption and form better governance, leading them to eventually become eligible to join the AGOA and achieve faster economic development in areas where women and youth tend to apply themselves in.

Symbol of the African Growth and Opportunity Act (Photo Credit: Advocacy).

The AGOA’s Role in Advancing Trade Liberalization, Economic Growth, Employment, and Development in Participating Countries

The AGOA builds upon the Generalized System of Preferences, also known as the GSP (United States Trade Representative, n.d.-c), which provides duty-free access to goods for 119 developing countries, along with multiple free trade agreements, in order to encourage economic growth in these countries. Together, both programs abolish duties on over 6,000 products (United States Customs and Border Protection, n.d.). The AGOA provides Africa stable access to the market, which fosters investment, gives governments the security to strategically plan for future growth, boosts employment, and grows the fiscal stability of the participating states' economies.

It created more than 300,000 jobs in Africa in 2010, and in just two years, in 2012, the non-profit African Coalition for Trade estimated that up to 1.3 million jobs were created indirectly. The AGOA has created a plethora of employment positions in Africa’s clothing and fabric industry, and between 75 to 90 percent of these jobs have gone to poor women (Council on Foreign Relations, n.d.), thereby helping them earn money and support their families. Women in Sub-Saharan countries are central to economic development and poverty reduction. Women's participation in labor is high in these countries, but they tend to work in places with little to no labor laws. However, the jobs formed through the AGOA provide better working conditions due to the required labor laws for eligiablity and participation in the program.

The African Growth and Opportunity Act provides duty-free trade, which shares similar aspects with free trade agreements, but is not entirely the same. A free trade agreement is reciprocal, meaning both countries must abide by the same laws, while a duty-free agreement is not required to be reciprocal. Since the program is not reciprocal, the U.S. has the right to remove eligibility from a participant at any time if the decisions of said countries are harming U.S. interests.

In the AGOA, the United States removes trade barriers, such as tariffs or certain customs regulations, encouraging U.S. companies to import from these Sub-Saharan countries, while the participating countries do not have to immediately do the same. Although these participants are not required to match the same decrease in trade barriers as the U.S., they must eliminate certain barriers on specific products to benefit both sides of this program. These include barriers on soft goods such as clothes or shoes, allowing for more and cheaper options for the U.S. and Africa.

In order to receive the benefits, the norm for products exported through the AGOA is that 35% of a good must be constructed in, by, or with any of the AGOA-eligible countries in order to encourage economic integration between Sub-Saharan countries (United States Customs and Border Protection, n.d.). They are permitted to use parts made in the United States for up to 15% of the whole value in order to provide a sort of safety net, since it can be difficult for these countries to source materials locally (United States Customs and Border Protection, n.d.). It also encourages African manufacturing to buy material and components from the United States, helping U.S. interests. For example, if something costs 100 USD, then 35 USD of the good’s whole value (100 USD) should be produced or derived from African assets, with the exception of using up to 15% American assets. In addition, there is also a special rule called the Third-Country Fabric Provision, designed for less developed beneficiary countries, which allows them to use fabrics and yarns sourced from any country around the globe to produce apparel while still receiving duty-free access (Congressional Research Service, 2024). 

These thoroughly planned, non-barrier pacts between both the USA and AGOA countries, have particularly benefited Kenya, bringing its sales up from 55 million USD to 603 million USD from the years 2001 to 2022 (Tralac, n.d.).

Another aspect of these types of barrier agreements includes the trade and reduction of barriers on transportation equipment and metals, such as iron and steel — especially from South Africa — in which automotive sales grew 1,643.6 percent in just one year, from 2000 to 2001, and then continued to increase by 447.3 percent from 2001 to 2022. In Ghana, non-oil exported goods increased from 206 million USD to 2.76 billion USD from the start of the AGOA to recently in 2022 (Tralac, n.d.).

Agricultural products are included in this demand for barrier decrease, and this specific requirement helps both sides associated with the AGOA. On one hand, it supports American farmers and interest groups, and on the other, importing agricultural goods from the U.S. aids in lowering food prices, which helps with starvation, especially in times of famine or conflict in these countries, which occur often.

Although there are many upsides to this arrangement, there is also the aspect that by having these countries adopt more open trade policies with the U.S., it could potentially hurt these countries due to the fact that they could be unable to compete with the agricultural economy of America. However, this arrangement also provides increased availability of advanced equipment and farming inputs to these AGOA countries, such as seeds, fertilizer, and much more in order to help local farmers grow in hopes that they will begin to trade amongst themselves domestically and regionally, further developing the economy of the whole African continent. They plan to integrate the African Continental Free Trade Area, with which the U.S. has accordingly signed a Memorandum of Understanding (MOU) with.

The AfCFTA and the MOU

The African Continental Free Trade Area, also known as the AfCFTA, is being looked at by much of the globe. The AfCFTA exists to form the world's largest free trade market area, including 55 different countries, in order to boost interconnection between African nations and encourage African economic independence (UNCTAD, n.d.). 

The AfCFTA symbol (Photo Credit: Import Export License).

In 2022, the USA signed a Memorandum of Understanding with the AfCFTA for trade and investment purposes, which would last for three years (United States Trade Representative, 2022), meaning this MOU has just recently expired at the end of 2025.

The goals between the AGOA and AfCFTA included policies to lessen poverty and clear the path for connection between civil society organizations like NGOs, trans-border populations, and private sector groups; in other words, build network amongst outside groups that operate in Africa and the U.S. They aimed to promote the execution of the AfCFTA Agreement, including its plans and policies regarding the trade of goods and services, digital trade, and intellectual property rights. They planned to accomplish this by encouraging additional alliances between African and U.S. companies, specifically working to integrate developing African farmers and micro- to medium-sized enterprises into regional value chains. Statements by the United States promoted economic advancement and employment for women, youth, and underserved groups in trade who often face hurdles that usually stifle development on a regional or international scale. The USA also shared lessons learned and its best practices to help with regional interconnection, especially since it has experience through the U.S. single market, made up of 50 states, which has laws preventing the creation of trade barriers or the imposition of tariffs on goods from other states. The AfCFTA and the US met yearly in order to discuss the application of this Memorandum of Understanding, and the participants also created technical working groups to address these plans and goals. These groups consulted with experts from the AfCFTA Secretariat, U.S. government agencies, and any other stakeholders selected by the participants, and each technical working group met quarterly or as it saw fit (United States Trade Representative, 2022).

The Future of AGOA: Trade Policy, Political Tensions, and Economic Consequences for Sub-Saharan Africa

As of 2021, the US is no longer utilizing the AGOA as it was in the 2000s. U.S. interest groups have stopped importing as many AGOA and GSP goods, with a drop from 80% to 24.7% in imports from these programs (The Conversation, 2026). This is due to changes in supply chains and trade patterns. Both the Biden and Trump administrations wanted the program to be renovated to fit the new agenda of market demand in the U.S., though they had different ways of accomplishing this mutual goal. This statistic implies that the AGOA now has, on average, little overall impact on most eligible countries. If the AGOA ended and current participating countries were required to pay normal U.S. tariffs these countries, individually, would end up unable to export to their previous level. However, total exports and economic growth would not change extravagantly for the whole. Even beneath the increasing Trump tariffs, the decrease in exports as a whole would not be that significant, since the U.S. is not the number one trading partner for most Sub-Saharan African countries.

If the AGOA ended, it may look okay in economic models at an average regional level, but at the individual level of a country, especially in highly dependent economies like Lesotho, the consequences could be significant and painful for people and families. Apparel exports to the U.S. could fall by about 50% for Lesotho, and by almost 90% for Madagascar and Mauritius, lowering total apparel exports by 128.5 million USD and 147 million USD in these two countries (The Conversation, 2026).

Back in 2018 through 2020, Trump's tariffs reduced benefits for many African countries, including South Africa, Nigeria, and Lesotho, hurting exports and jobs in those countries. Losing the AGOA could reduce Lesotho’s GDP (Gross Domestic Product) by 1% and apparel exports by 16 percent (World Economic Forum, 2023). Other African countries that rely on the AGOA could face similar problems. Although it might sound insignificant, a 1% decrease in GDP can signify a loss of billions of dollars in economic affairs, resulting in reduced fiscal intake, slower job expansion, and a possible rise in poverty across Sub-Saharan Africa.

Trump presenting AGOA 2026 plan (Photo Credit: The White House). 

As of September 2025, when the AGOA expired (IDOS, 2026), the U.S. had not renewed it due to the governmental shutdown and disagreements over federal funding, which prevented Congress from focusing on a timely renewal for the program. Many factors contributed to the hesitation for renewal, including questions regarding South Africa’s eligibility, the assurance that labor and environmental standards are met, the need to update the rules of origin for modern supply chains, concerns about the U.S. trade deficit with Africa, and the consideration of Trump’s "America First" policy.

On February 3, 2026, Trump signed the AGOA renewal for one year until December 31, 2026, backdated to September 30, 2025, to accommodate losses that Sub-Saharan countries may have incurred (Nwite, 2026). This has created a sense of instability that is abnormal regarding this program since this is the first time it has ever been renewed for only a year. This short renewal discourages investment in these countries, which is the opposite of what the AGOA was originally created to do. This implies that the AGOA is on thin ice, and if it melts away, so could the jobs that it produced. Without this program, production in Africa could struggle to compete with cheaper, more advanced economies internationally, which could result in factory closures and mass unemployment.

Although the AGOA is not as impactful on a graph or scale as China's influence, looking at its results if it ends should not be a mere number to read, but a moral reminder that the women and youth of Africa need support. The AGOA not only helps economically; its goals are also to help with corruption and human rights, which cannot be forgotten for these people. As stated earlier, President Trump seeks to modernize the AGOA or simply U.S.-African trade in general. “We must also make sure that the program enhances U.S.-African trade and will work with Congress over the next year to modernize the program to align with President Trump’s America First Trade Policy,” says U.S. Trade Representative Jamieson Greer.

As of right now, the United States does not have any free trade agreements with Sub-Saharan African countries (United States Trade Representative, n.d.-b); however, the EU has 15 free trade agreements with such countries, in the form of EPAs (economic partnership agreements) which offer reciprocal bilateral trade with duty-free and quota-free access to the European Union's market (Lexology, n.d.). Although the U.S. also offers duty-free access to their market, and these agreements may sound similar, they are not the same. The key distinction is "reciprocal." The EU agreements are reciprocal, or "tit for tat," while the U.S. agreements are not.

While the European Union’s EPAs do offer duty-free access to European markets, they may not fully cover the consequences of an end to the AGOA. Multiple Sub-Saharan African exporters, specifically in apparel, are very aligned with the U.S. market, making it challenging to quickly change trade patterns. Although the European Union offers alternative market access and is a larger market for Sub-Saharan African countries, the differences in demand, competition levels, and rules of origin hold back the EU’s ability to cushion the losses that the AGOA would cause if it came to an end, meaning thousands would be out of a job and millions could enter into extreme poverty even with the EU deals as a possible safeguard.

Trump wants to move away from duty-free deals to more even trade, such as bilateral or reciprocal trade agreements (Print & Promo Marketing, 2026), more similar to what the EU has with Sub-Saharan countries. He wants to replace the AGOA with these bilateral agreements to align with his policies. He is attempting to even out the trade deficit with Africa, which is relatively small from the AGOA — but much larger from the total of the U.S.-African trade —  in order to protect American interests and companies, and secure critical resources for the U.S. economy. The U.S. is pursuing different, non-FTA agreements, such as the U.S.-Kenya Strategic Trade and Investment Partnership (STIP) and the Trade, Investment, and Development Cooperative Agreement (TIDCA) with the Southern African Customs Union (SACU), which includes the countries Botswana, Eswatini, Lesotho, Namibia, and South Africa. Nevertheless, there are still efforts in the American government to extend the AGOA beyond solely one year.

An AGOA bill, promoted by Republican Representative Jason Smith, was first bipartisanly passed through the U.S. House for an extension of three years until the year 2028 (Daily Maverick, 2026); however, differing priorities in the matter led to a shortened one-year renewal. Republican Senator John Kennedy put forward a competing bill that would lengthen AGOA until 2027. This bill required an evaluation of US-South Africa relations, pointing out South Africa's connections with the governments of Iran, China, and Russia, which are the United States’ main geopolitical competitors. This bill proposed the possibility of excluding South Africa from the AGOA and suggested imposing sanctions on the country (Daily Maverick, 2026). Although the one-year extension has been passed and mobilized, both the three-year extension bill and the bill arguing to remove South Africa from the AGOA remain active discussion points in the U.S. Senate; however, with congressional elections approaching, the more hostile bill has a lower chance of being approved, and it is unknown whether any further legislation on this matter will be passed.

U.S. President Donald Trump and South African President Cyril Ramaphosa: Allies or Adversaries? (Photo Credit: Nova News)

The United States already had an average 3.3% tariff rate, but Trump has imposed reciprocal tariffs on all goods, with the percentage rate depending on the country, most landing at 15% (Reuters, 2025). The AGOA only removes the original tariffs of 3.3%, not these new additional ones applied by Trump, and these tariffs have resulted in weakening the benefits of the program. This is especially relevant for South Africa since he added a 30% tariff on goods imported from the Rainbow Nation (Reuters, 2025). This 30% tariff, due to South Africa's involvement in BRICS, was put in motion six months ago (Reuters, 2025). The United States of America is South Africa’s second largest trading partner (Reuters, 2025), but this duty has the smaller country questioning its trade relationships and dynamics. With its participation in BRICS and the AGOA, South Africa receives economic pressure from both sides, making it difficult to remain neutral when the benefits from both are a necessity for its economy. Nonetheless, South Africa has chosen to continue economic ties with the United States through the one-year renewal of AGOA, but will continue to search for new trade relations that could be made, specifically looking to enhance trade between its African neighbors through the AfCFTA.

Trump navigating questions regarding tariffs (Photo Credit: Getty Images).

Conclusion

The African Growth and Opportunity Act initially seemed to lift African economies upstream, but it appears that, recently, the AGOA has merely been floating and may now even be drifting downstream. Although the AGOA has produced many good outcomes for both Sub-Saharan African countries and the United States, its future remains uncertain. With growing political tension involving Russia, China, and Iran, questions continue to arise about South Africa's role and relations, and thus its participation in the program. The geopolitical situation is not the only factor impacting the AGOA’s future. Trump’s new goals and policies make it difficult to say for certain whether the AGOA will continue, as he seeks to move away from duty-free trade and move towards reciprocal trade agreements with Africa. These aspects of the current relations between Africa and the United States are the factors that will continue to shape the future of  U.S.-African economic policies. 

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