AGOA
Tanzania became eligible for duty-free access to the US market under the African Growth and Opportunity Act (AGOA) in 2000.
AGOA is a US trade preference program that provides eligible sub-Saharan African countries with duty-free access to the US market for over 6,800 products.
Tanzania also qualifies for textile and apparel benefits.
AGOA has had a positive impact on the Tanzanian economy. It has helped to create jobs, boost exports, and attract foreign investment.
In 2000, Tanzania exported USD 10 million worth of goods to the US under AGOA. This amount had increased to USD 55.3 million in 2022.
AGOA Eligibility and Time Frame
The eligibility for countries under AGOA is determined annually by the President of the United States, based on progress towards a market-based economy, rule of law, elimination of barriers to U.S. trade and investment, and not engaging in gross violations of internationally recognized human rights.
Tanzania’s involvement with AGOA has allowed it to export various products to the U.S. under this trade preference program.
Since 2000, AGOA has been renewed several times since then. The current authorization expires in 2025.
The scheduled expiration raises concerns about the future of trade relations and the need for a more integrated approach to U.S.-Africa economic relations.
In November 2023, Tanzania’s Minister of Industry and Trade called for an extension of AGOA beyond 2025, stressing the importance of this program for Tanzania and other eligible African countries.
AGOA Trade With Tanzania
According to the Office of the US Trade Representative (USTR), Tanzania exported USD 55.3 million worth of goods to the US under AGOA in 2022.
This was up from USD 42.8 million in 2021 and USD 40.8 million in 2020.
In 2022, Tanzania exported a total of USD 164 million in goods to the U.S.
The top AGOA exports from Tanzania to the US in 2022 were:
- Apparel and textiles
- Processed agricultural products, such as cashew nuts, coffee, and spices
- Leather goods and footwear
- Handicrafts
The US exported USD 260 million worth of goods to Tanzania in 2022. This was down from USD 272 million in 2021.
The top US exports to Tanzania in 2022 were:
- Machinery and equipment
- Transportation equipment
- Chemicals
- Food and agricultural products
AGOA Impact on Tanzania
AGOA has had a positive impact on the Tanzanian economy. It has helped to create jobs and boost exports. AGOA has also helped to attract foreign investment to Tanzania.
A 2019 study by the USTR found that AGOA supported over 16,000 jobs in Tanzania in 2017.
The study also found that AGOA exports from Tanzania to the US increased by 250% between 2002 and 2017.
Challenges in the Use of AGOA in Tanzania
Despite the positive impact of AGOA, Tanzania still faces some challenges in taking full advantage of the program. These challenges include:
- Limited production capacity
- High transportation costs
- Lack of awareness of AGOA among businesses
The Tanzanian government is working to address these challenges. For example, the government is investing in infrastructure to reduce transportation costs. The government is also working to raise awareness of AGOA among businesses.
Overall, AGOA has been a success for Tanzania. It has helped to create jobs, boost exports, and attract foreign investment. The Tanzanian government is working to address the challenges that remain so that Tanzania can continue to benefit from AGOA.
Last Updated: 7th November 2023
