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AFRICA GROWTH AND OPPORTUNITY ACT
The African Growth and Opportunity Act (“AGOA”) offers qualifying countries of sub-Saharan Africa enhanced trade preferences that seek to encourage higher levels of trade and direct investment in the region. AGOA adds over 1,800 products to the more than 4,600 products that sub-Saharan African countries can export to the United States duty-free under the U.S. Generalized System of Preferences (GSP). The initial AGOA legislation (“AGOA I”) was enacted by Congress on May 17, 2000 under the Trade and Development Act of 2000. In 2008, more than $66.3 billion of goods were imported under AGOA.
AGOA I was amended on August 6, 2002 as part of the Trade Act of 2002 (“AGOA II”). AGOA II modified textile- and apparel-specific language, including: (1) the designation of knit-to-shape apparel as AGOA-eligible; (2) the allowance of duty-free treatment for apparel articles assembled in AGOA-eligible countries regardless of origin of fabric or yarn (whereas AGOA I only provided language for fabric); (3) the allowance of hybrid cut fabric to enter the United States duty-free; and (4) the doubling of applicable percentages for the volume cap on duty-free treatment of apparel made from fabric made in the AGOA region or, for less developed beneficiary countries, from fabric made anywhere. In addition, AGOA II specially designated Botswana and Namibia as less-developed countries under AGOA.
AGOA was further modified under the AGOA Acceleration Act of 2004 (“AGOA III”), enacted on July 12, 2004. AGOA III extended preferential access for imports from sub-Saharan African beneficiary countries through September 30, 2015; extended the third-country fabric provision from September 2004 through September 2007; and provided additional Congressional guidance to the Administration on how to administer the textile provisions of the bill.
The Africa Investment Incentive Act of 2006 (signed by President Bush on December 20, 2006) further amends portions of the African Growth and Opportunity Act (AGOA) and is referred to as "AGOA IV". The legislation extends the third country fabric provision for an additional five years, from September 2007 until September 2012; adds an abundant supply provision; designates certain denim articles as being in abundant supply; and allows lesser developed beneficiary sub-Saharan African countries export certain textile articles under AGOA.