Scott Nathan ? U.S. Department?s Special representative for Commercial and Business Affairs

Scott Nathan ? U.S. Department?s Special representative for Commercial and Business Affairs

The United State Department?s Special representative for Commercial and Business Affairs, Mr Scott Nathan has expressed delight at the growth of companies under the U.S African Growth and Opportunity Act (AGOA) initiative

Mr. Nathan said this when he visited DTRT Apparel, one of the textiles companies benefiting under the African Growth and Opportunity Act (AGOA) initiative.

Mr Nathan, who was in the country last week, visited the factory to familiarize with activities of the AGOA beneficiary and also to accustom himself with current developments at the factory.

Together with his team from the American Embassy in Accra, Mr. Nathan visited the various sections and departments of the factory to see firsthand, how the manufacturing of textiles for the US market was done.

Speaking at a press briefing after the tour, Mr. Nathan expressed his delight and satisfaction at the activities of DTRT Apparel and the progress that had been made under the AGOA initiative.

?I am very impressed. I enjoyed our conversation, and I very much enjoyed the tour and thought that it was very instructive to see what is being done here. This is a real accomplishment and I congratulate the team here at Dignity and the Ghanaians who work here. It is really a great thing to see the scale and also the opportunity to grow?, Mr. Nathan stated.

He stressed that though there were challenges facing the company, he believed that the coming together of challenges and opportunities presented the opportunity for growth.

?There are challenges but challenges and opportunities come together for growth. This is without question the sort of thing the United States wants to support and has been supportive whether it?s through our West African Trade Hub which helps make some of the initial introductions through the ongoing roles in helping with grant application or resolving any sort of technical issues related to export that always come often. And of cause AGOA which you heard Mark talk about, that it is a critical part of the opportunity here. This is an example of what the United States takes very seriously and is supportive of?, he said.

The U.S special representative explained that the efforts by the U.S to support companies grow was in the larger context of its commitment to Ghana which is a very important partner to the United States.

He explained that the fact that Ghana was the largest recipient of USAID in West Africa was proof of what critical trading partner the country was to the U.S.

The African Growth and Opportunity Act (AGOA) is an initiative of the US government to provide market access to eligible sub-saharan African countries to enter the US market. AGOA provides trade preferences for quota and duty-free entry into the United States for certain goods, expanding the benefits under the Generalized System of Preferences (GSP) program.

This initiative of the US government seeks to expand U.S. investment and trade with sub-saharan Africa, encourage economic integration, stimulate economic growth, and facilitate sub-Saharan Africa?s integration into the global economy. The agreement was signed into law by President Clinton in May 2000.

With Ghana?s credentials as a beacon of democracy on the African continent and meeting the AGOA eligibility criteria including progress towards the establishment of a market-based economy, rule of law, economic policies to reduce poverty, protection of internationally recognized worker rights, and efforts to combat corruption, it became a member when the initiative was first introduced. Forty-one sub-saharan African countries as at August 2014 were eligible for AGOA benefits.

Much as AGOA covers most sectors of trade and investment, textiles and apparel received detailed attention in the agreement due to its importance in the socio-economic development of African countries and the fact that textiles and apparels are not included in the GSP.

Thus, whiles the US GSP covers about 4,600 products that receive duty free treatment; AGOA expanded the list to about 6,400 products, and includes textiles and clothing for the first time. Since its inception, AGOA has helped to increase trade between Ghana and U.S. However, there are reports that Ghana including other African countries has not made maximum use of the agreement.

The African Development Bank reports that the low utilization of AGOA preferences by beneficiary countries is in stark contrast to the aggressive export strategies that other developing countries like Bangladesh, Cambodia and Vietnam have adopted to access the US market. These are countries that share many of same infrastructure challenges facing Sub-Sahara African countries.

Irrespective of the low utilization of AGOA preference, its inception in 2000 has acted as a catalyst to Sub-Saharan Africa (SSA) trade with US particularly in the oil, footwear, vehicles and parts, clothing and textiles sectors. According to the AGOA.info website, U.S. imports from AGOA countries have grown from $8.2 billion in 2001 to $26.8 billion in 2013, a threefold increase. Non-oil AGOA trade has increased almost fourfold during the same period from $1.4 billion to almost $5 billion.

The AGOA official figures say US. direct foreign investment (FDI) stock in sub-Saharan Africa has also increased from approximately $9 billion to $35 billion. And according to the African Coalition on Trade, AGOA-related investment has resulted in the creation of some 300,000 jobs in sub-Saharan Africa and almost 120,000 jobs in the United States. In the apparel sector alone, AGOA is estimated to have created as much as 350,000 jobs in SSA since 2001 and some 100,000 jobs in the US economy (AfDB, 2013).

By Vincent Baffour-Acheampong

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