Lusaka: Experts at the African Growth and Opportunity Act (AGOA) mid-term review meeting have recommended for the extension of third-country fabric clause for 10 years and called on America to support Africa on matters of Sanitary and Phyto-Sanitary (PSP). During the meeting on Wednesday, the technocrats said the third country clause in the AGOA which is scheduled to expire in 2012 should be extended because without it would have devastating effects on the African counties.
The officials said this during a meeting held at the Mulungushi International Conference Centre in Luaska ahead of a Ministers Meeting yesterday.
In his presentation to the meeting which was backed by all 20 countries in attendance, African Union Expert on Trade Policy Festus Fajana said the clause should be maintained. Professor Fajana said a study in East, West and Southern Africa had shown that AGOA should be made permanent and that third country fabric clause be extended for at least 10 years to build capacity in the cotton industry in Africa. "There is need for African ministers to lobby for the extension of the third country fabric and AGOA itself beyond 2012 and 2015 respectively. The US should also support African countries in matters of Sanitary and Phyto-Sanitary (SPS) and technical standards," he said.
The US has stated that beginning September 2012, its market would no longer be accepting garments whose raw materials could have been sourced from outside the exporting country. Most African goods have failed to meet the hygienic standards of the PSP making the food industry unable to properly penetrate the US market.
With Sub-Saharan Africa's competitive edge being in agriculture, the PSP failure has resulted in less than one per cent of African agro-goods forming up trade with the USA.
United Nations Economic Commission for Africa (UNECA) said the Rules of Origin (RoO) should be revised to allow African countries to produce goods at competitive prices by buying from cheaper sources. "Rules of Origin should be revised to afford more flexibility for textile to source cheaper inputs globally and foster value chain creation in the Sub-Sahara African region," said UNECA chief of Trade and International Negotiations Dr Stephen Karingi.
Dr Karingi said AGOA eligible countries should overcome the supply-side constraints by facilitating and reducing customs requirements and procedures as well as establish national focal points.