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Exporting to Sub-Saharan Africa is a win-win!

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Created on September 12, 2013

Last month the United States Government partnered with the Federal Democratic Republic of Ethiopia to host the 2013 U.S.—Sub-Saharan Africa Trade and Economic Cooperation Forum in one of East Africa’s largest and most vibrant cities, Addis Ababa, Ethiopia.  Senior U.S. Government officials and business leaders, along with their counterparts from African Growth and Opportunity Act (AGOA)-eligible nations, discussed a range of trade and investment-related issues that are likely to have a significant impact on the future of Sub-Saharan Africa. 

AGOA is the most important trade legislation between the United States and Sub-Saharan Africa to date, and has paved the way for new product exports to the United States, including cut flowers, horticultural, automotive products, and steel. Textile, apparel goods and agricultural products, a promising area for new AGOA trade, were added in 2009.  Since being signed into law in 2000, AGOA has resulted in substantial growth of the African apparel industry, adding 350,000 new jobs in Sub-Saharan Africa, and about 100,000 jobs in the United States. 

AGOA has also contributed to better market opportunities and stronger commercial partners in Africa for U.S. companies. While helping to integrate Africa into the global economy, the agreement enables U.S. firms to find new opportunities in privatizations of African state-owned enterprises or in partnerships with African companies on infrastructure projects.  Since 2001, the first full year of AGOA trade, U.S. total trade with Sub-Saharan Africa has more than doubled, from $28.2 billion to $72.3 billion in 2012. The agreement enabled U.S. exports to the region to more than triple from $6.9 billion in 2001 to $22.6 billion in 2012. While AGOA is set to expire in 2015, President Obama (who spoke at the 2013 Forum via video conference), U.S. Trade Representative Michael Froman, and key members of Congress have expressed strong support for AGOA’s renewal.

With seven of the ten fastest growing economies, and greater transparency and political stability than ever before, U.S. business owners should strongly consider leveraging the foundation of AGOA to expand their businesses into Africa. Private consumption in Africa is higher than Russia and India, having risen by $568 billion from 2000 to 2010. By 2020, more than half of African households are projected to have discretionary income; rising from 85 million households today to 130 million by 2020.  In addition to Africa’s emerging middle class, opportunities for U.S. firms to expand into Sub-Saharan markets are also available through upcoming infrastructure projects in AGOA-eligible countries.

Regardless of the product or services you offer, or what market entry strategy you choose to utilize, the Minority Business Development Agency and the United States Department of Commerce are here to help your business grow.  Please contact the MBDA Business Center nearest you for assistance.

The African Growth and Opportunity Act (AGOA) expands U.S.-Sub-Saharan African trade and investment, stimulates economic growth, promotes a high-level dialogue on trade and investment-related issues, encourages economic integration, and facilitates Sub-Saharan Africa’s integration into the global economy. The legislation provides reforming African countries with the most liberal access to the U.S. market available to any country or region with which the United States does not have a free trade agreement. Under AGOA, eligible countries can export thousands of products to the United States duty-free.

From the Director

From the Director