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The African Growth and Opportunity Act, exports, and development in Sub-Saharan Africa

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  • Brenton, Paul
  • Hoppe, Mombert

Abstract

The African Growth and Opportunity Act (AGOA) is the flagship of U.S. commercial and development policy with Sub-Saharan Africa. This paper looks at the impact of the trade preferences that are the central element of AGOA on African countries'exports to the U.S. and puts them in the perspective of the development of the region. The paper finds that, while stimulating export diversification in a few countries, AGOA has fallen short of the potential impetus that preferences could otherwise provide African exporters. The impact of AGOA would beenhanced if preferences were extended to all products. This means removing tariff barriers to a range of agricultural products and to textiles and a number of other manufactured goods. There also needs to be a fundamental change in approach to the rules of origin. Given the stage of development and economic size of Sub-Saharan Africa, nonrestrictive rules of origin are crucial. For all countries in Africa, those that have and those that have not benefited from preferences, there are enormous infrastructure weaknesses and often extremely poor policy environments that raise trade costs and push African producers further away from international markets. Effective trade preferences (those with nonrestrictive rules of origin) can provide a limited window of opportunity to exports while these key barriers to trade are addressed. But dealing with the barriers is the priority.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3996.

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Date of creation: 01 Aug 2006
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Handle: RePEc:wbk:wbrwps:3996

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Related research

Keywords: Free Trade; Economic Theory&Research; Trade Policy; Agribusiness&Markets; Markets and Market Access;

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Cited by:
  1. World Bank, 2008. "Africa : Economic Partnership Agreements between Africa and the European Union, What to do Now? Summary Report," World Bank Other Operational Studies 7850, The World Bank.
  2. Salvador Gil-Pareja, 2011. "Do nonreciprocal preference regimes increase exports?," ERSA conference papers ersa11p1561, European Regional Science Association.
  3. Fontoura, Maria P. & Crespo, Nuno, 2013. "Trade Performance of the Less Developed African Countries," MPRA Paper 49193, University Library of Munich, Germany.
  4. Cooke, Edgar F. A., 2012. "Is the impact of AGOA heterogeneous?," MPRA Paper 43277, University Library of Munich, Germany.
  5. Martine AUDIBERT, 2008. "Endemic diseases and agricultural productivity: Challenges and policy response," Working Papers 200823, CERDI.

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