Understanding AGOA and Where the Opportunities Are

Michael J. Blakeley

Nathan Associates Inc.

Trade an Investment with the AGOA Countries in Africa Conference

2

Understanding AGOA

• Basic principles:―Preferential trade arrangement

―Duty-free access for products made in qualifying countries/ GSP+

―Sub-Saharan African countries which must be evaluated against rigorous criteria

―Products must meet ROO requirements*

―Development tool

3

Review of Trade Arrangements

Bilateral Trade Agreements in Force

Preferential Trade Arrangements

Free Trade Agreements Negotiated or Approved but not in Force

Morocco

Israel

Singapore

Australia

Jordan

NAFTA

Bahrain

Chile

CAFTA-DR

Peru

Oman

GSP

AGOA

APTDEA

CBI

Colombia

South Korea

Panama

Malaysia

Thailand

UAE

SACU

4

Performance review: AGOA/GSP

Imports-Value (1,000)AGOA including GSP

provisions 2008 YTD

Agricultural products 250,214

Forest products 6,762

Chemicals and related products

428,269

Energy-related products 61,154,766

Textiles and apparel 1,138,837

Footwear 712

Minerals and metals 1,263,964

Machinery 23,189

Transportation equipment 1,911,828

Electronic products 16,941

Miscellaneous manufactures 63,346

Total 66,258,828

Imports-% AGOA BenefitAGOA including GSP provisions 2008 YTD

Agricultural products 18.19

Forest products 4

Chemicals and related products

30.26

Energy-related products 85.26

Textiles and apparel 96.21

Footwear 36.88

Minerals and metals 17.38

Machinery 6.46

Transportation equipment 93.17

Electronic products 17.82

Miscellaneous manufactures 45.16

Total 76.97

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What Opportunity does AGOA Provide?

• Manufacturing in Africa becomes more attractive due to duty benefits;

• Sourcing finished products also attractive;

• Selling to firms producing for the US;

• More U.S. government support available for investment or exports.

6

Best Sourcing Opportunities

• Apparel• Footwear • Vehicles• Fruits and nuts• Prepared vegetables• Leather products• Cut flowers• Prepared seafood

7

Success Stories

• U.S. Side:―Food Emporium New York―Apparel companies/GAP

• Africa Side:―Malian handicrafts/Hallmark―Botswana furniture maker

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Ranking Business Opportunities

1. Manufacturing for U.S. Market

2. Competitive Import Sourcing

3. Export to Manufacturers Serving U.S.

4. Investment