Clubbing Africa with AGOA

It has taken the Trump administration to change my mind about the African Growth and Opportunity Act and to see that Nelson Mandela was right to worry about its “conditionalities”.

The epiphany came as I listened to US Trade Representative Robert Lighthizer talk about AGOA not as a way of encouraging investment in African export industries or of moving from aid to trade, but as a stick to get African governments to play by America’s rules. “They get duty preferences when they do that.”

I am not so naive as to deny there was always a stick element to AGOA, but I believed the stick would be applied judiciously and was worth tolerating in return for pretty much unfettered access to the world’s largest market.

I thought SA was foolish to protect its lame poultry sector when AGOA was helping the country run a substantial trade surplus with the US, much of it accounted for by manufactures. I also believed SA erred in balking at a reciprocal trade agreement with the US years earlier in place of unilateral AGOA. That way the chicken row might have been avoided.

But now comes the orange bully boy who equates Africa with excrement and is on an imbecile mission to “make America great again” at everyone else’s expense (and ultimately, its own). In his hands, AGOA, its conditions and coming expiration in 2025, are brass knuckles.

If there’s any doubt Trump’s trade office will use them, consider its disgraceful decision to side with America’s rag and bone men against members of the East African Community. The latter are being told that if they continue resisting imports of America’s cast-off t-shirts, their AGOA privileges will be cancelled, their aim to build their own textile and apparel industries be damned.

Lighthizer is under orders to strike “as many bilateral agreements as possible”. Divide and conquer is the Trump way. It’s much easier to “win” when dealing with smaller countries one at a time.

“I think that before very long we’re going to pick out an Africa country, properly selected, and enter a free trade agreement with that country,” said the trade representative. “And then that, if done properly, will become a model for these other countries.”

With yesterday’s launch of the Continental Free Trade Area, Africa is moving in precisely the opposite direction to Trump’s crude zero sum bilateralism.

A grown-up US policy would be predicated on supporting the CFTA vision, not trying to cut separate deals. In the closing days of the Obama administration, Lighthizer’s predecessor laid out some options along those lines in a thoughtful report, Beyond AGOA. But association with Obama is the kiss of death in Trump world.

Lighthizer said he saw “enormous potential” in Africa and that “we’re only a few years away from (it) being the population centre of the world.” Good to hear. Then he spoiled things:

“If we don’t figure out a way to move them (Africans) right then China and others are going to move them in the wrong direction.”

So China is moving Africa in the wrong direction? Is any outside country doing more to address Africa’s infrastructure needs or help the continent integrate and industrialise?

In any event, Mr Lighthizer, Africans are perfectly capable of deciding the direction that works for them without guidance from a president who holds them in contempt and hasn’t even bothered to name an Assistant Secretary of State for Africa.

Here’s hoping you do not succeed in using AGOA or its expiration date to separate one or two countries from the pride, and that none takes the bait or caves to threats.  Africa should wait till reason returns to the White House. Why negotiate with the trade representative of a highly eccentric one term administration.

 

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