Rwanda, one of Africa’s fastest growing economies, has called on the United States government to grant easier access to traders from across Africa doing business with America market under the renewed African Growth Opportunity Act (AGOA).
The East African nation is one of the beneficiaries of AGOA, the signature trade initiative by the US government to allow at least 7000 products from 39 nations in Sub Saharan Africa to America market duty-free.
“The process of acquiring visas remains lengthy even if we qualify through that trade window (AGOA). This doesn’t look good for companies seeking to make use of that market,” The New Times quoted Joselyne Bazubagira, the head of products at Kaliza Fashion and Design, a clothing company from Rwanda.
Erica Barks-Ruggles, the US Ambassador to Rwanda said that the US government has been trying to ease visa acquisition for AGOA traders.
The two spoke when Trade and Industry officials from Rwanda and the US launched the renewed AGOA action plan in Kigali, the country’s capital, on Tuesday.
AGOA, which builds existing U.S. trade programs by expanding duty-free benefits previously available only under the country’s Generalized System of Preferences (GSP) program, was introduced in 2000 by former U.S. President Bill Clinton.
The 15 year treaty was renewed last September by President Barrack Obama, AFKInsider reported.
In the review, US President Obama added 27 products to the list of duty-free imports into American market from the region, in June this year. The products included clothes, footwear, agricultural products, chemicals, steel and motor vehicle parts among others.
Francois Kanimba, Rwanda’s minister for Trade and Industry said the new chapter will help traders maximize on the potential of the US market for their products.
Rwanda’s products to US have also been hindered by high cost of transport, a problem that needs collective responsibility from both governments.
The ambassador said that it is challenging to lower transport costs especially for landlocked nations, such as Rwanda.
“The cheapest form of transport is shipping containers and if you don’t have an ocean on your border it makes it more expensive. Thus figuring ways to bring down the price of transport is very important,” she added.
The US government has been pushing the East African Community nations to create free trade areas, bring down non-tariff barriers and the time spend to get harmonized custom papers at their borders.
Currently, the volume of trade goods from Rwanda to US remains low compared to other AGOA beneficiaries like Nigeria, South Africa and Kenya.
By the end of 2015, Rwanda’s exports to US under the trade agreement was $46.8 million. The nation targets to grow the value of exports to $101.90 million by 2018, The New Times reported.
Kenya, East Africa’s biggest economy is the leading exporter to U.S. market, accounting for nearly 59 percent of exports under AGOA.
Overall, African exports to the U.S. fell from $72 billion in 2011 to $19 billion in 2015.
The 15th AGOA Forum is scheduled for September 22-26, 2016 in Washington D.C, US.