African nations face economic uncertainty as a 25-year preferential trade agreement might conclude without renewal, triggering urgent bilateral negotiations and strategic pivot toward alternative markets
The African Growth and Opportunity Act (AGOA) has been the cornerstone of U.S. economic engagement with Africa since its introduction in 2000.
It offered duty-free, quota-free access for thousands of products from 32 eligible African nations into the U.S. market, in exchange for commitments to good governance, market-based economies, and open investment.
Washington monitored compliance closely, with Ethiopia, Mali, and Uganda removed in recent years for non-compliance. The deal was extended in 2015 for a decade, but no new extension has been secured, and Donald Trump’s return to the White House has amplified uncertainty, given his preference for tariff-driven trade.
How AGOA Benefited Africa’s Economies
AGOA is credited with boosting Africa’s exports, jobs, and foreign investments. According to a U.N. trade study, U.S. imports from AGOA countries grew 37% between 2001 and 2021, more than doubling when petroleum exports from Angola and Nigeria were excluded.
South Africa has been the biggest beneficiary, while Kenya successfully diversified into apparel manufacturing. On average, annual U.S. imports of $37.7 billion under AGOA far exceeded U.S. aid flows to Africa, which stood at $7.6 billion, making the programme an economic lifeline.
Risks of AGOA Expiry
The abrupt end of duty-free access would slash exports, undermine investments, and threaten jobs across the continent. Africa’s exports to the U.S. could shrink by about 25%, equal to 1% of total global exports, according to London-based Development Reimagined.
The African Development Bank has already cut its growth outlook, citing tariff turmoil. In Kenya, Trade Minister Lee Kinyanjui warned that 300,000 jobs in textiles and apparel could vanish, while South Africa faces tens of thousands of job losses in an economy already stuck with over 30% unemployment.
Washington’s Silence
The U.S. government has remained silent on AGOA’s reauthorization. Trade Representative Jamieson Greer previously signaled that Washington prefers bilateral deals over regional programmes, leaving countries to scramble individually.
Kenya, which launched trade talks with Washington in 2020, is seeking a deal before year-end, protecting the 10% of exports that go to the U.S. South Africa is also racing to clinch its own pact, as its goods face tariffs of up to 30%, compared with Kenya’s 10%.
New Partnerships on the Horizon
As Washington drags its feet, Africa is eyeing alternative trade paths. The African Continental Free Trade Area (AfCFTA), involving 54 nations and 1.5 billion people, could help the continent reduce external dependency and promote intra-African trade.
China, which scrapped tariffs for 33 African nations, is fast emerging as a key substitute partner. In 2024, AGOA exports to the U.S. totaled $8 billion, while China-Africa trade soared to $295 billion, up 4.8% year-on-year, according to Chinese customs data.
The Role of Europe and Emerging Partners
The European Union continues to engage Africa through Economic Partnership Agreements (EPA), ensuring it remains an important player in African trade. Meanwhile, India, Turkey, Brazil, and Russia are also vying to expand their economic footprint across the continent.
But experts caution against falling into new dependencies. “The challenge for Africa is to negotiate balanced agreements that actually promote local value creation,” said Mamady Kamara, a Washington-based consultant for governance, development policy, and entrepreneurship.
Looking Ahead
AGOA’s looming expiry underscores Africa’s need to broaden its trade strategy and deepen regional integration. While U.S. markets remain important, the continent’s future growth may rely more on diversified trade with Asia, Europe, and within Africa itself.
For Africa, the end of AGOA should not be seen as a crisis but as a catalyst. By leveraging AfCFTA and striking balanced global partnerships, the continent can chart a path toward greater independence and sustainable growth.
