MODERATOR: Good morning to everyone from the U.S. Department of State’s Foreign Press Center and Africa Regional Media Hub. I would like to welcome our participants dialing in from across the continent and in person here at the FPC and thank all of you for joining this discussion.
Today, we are very pleased to be joined from Washington, DC by Robert Scott, Acting Deputy Assistant Secretary for African Economic and Regional Affairs, and Constance “Connie” Hamilton, Assistant U.S. Trade Representative for Africa, who will provide an update on U.S. economic policy in Africa and efforts to expand trade and investment in Africa under the African Growth and Opportunity Act or AGOA.
We will begin today’s call with opening remarks from Ms. Hamilton, Mr. Scott, and then we will turn to your questions. We will try to get to as many of them as we can during the time that we have, which is approximately 45 minutes. At any time during the call, if you would like to ask a question, you must press *1 on your phone to join the question-and-answer queue. For our journalists listening on the French and Portuguese lines, please email your questions in English to AFMediaHub@state.gov. If you would like to join the conversation on Twitter, please use the hashtag #AFHubPress and follow us on @AfricaMediaHub.
As a reminder, today’s call is on the record, and with that I will turn it over to Assistant U.S. Trade Representative Connie Hamilton and thereafter Acting Deputy Assistant Secretary Robert Scott. Please, go ahead, ma’am.
MS HAMILTON: Okay, thank you very much, and thank you all for joining us today. It’s always a pleasure to talk about the AGOA Forum. We’ve been working very hard to put on this forum, and we’re looking forward and very excited to have it take place at the State Department.
The forum provides an opportunity for American and African government officials, civil society, and businesses to work in partnership to promote stronger trade and investment ties between the United States and Sub-Saharan Africa. We always look forward to having robust discussions with our partners.
The theme of this year’s forum is “Forging New Strategies for U.S.-Africa Trade and Investment,” and this is particularly appropriate as we examine the future of U.S. African trade and investment relationships.
Just two weeks ago, USTR issued a report on the implementation of the AGOA program over the past two years. The report highlights many achievements. Trade between the United States and Africa grew by 6 percent over the past couple of years. Non-oil trade continues to grow, and more countries are diversifying their exports. AGOA has helped create hundreds of thousands of jobs and economic opportunity across the continent, and the administration continues to support AGOA.
After nearly 20 years of working with countries to help maximize AGOA benefits, the United States has played a positive role in attracting investment, diversifying trade, and helping African countries move up the value chain in production.
We also see after nearly 20 years under AGOA that one-way tariff preferences can only do so much to drive trade and investment. Businesses and investors want clear rules of the road and a sound business environment and certainty, and that’s why U.S. Trade Representative Robert Lighthizer has signaled his interest in forging new strategies for U.S.-African trade and investment. The administration wants to continue to build on AGOA’s success by strengthening bilateral trade relationships in Sub-Saharan Africa and perhaps by initiating exploratory talks to consider bilateral free trade area agreements.
Ambassador Lighthizer looks forward to discussing his ideas with ministers and other officials at the forum. So let me turn now to Rob Scott, who’s going to go into detail about this year’s forum, to talk about some of the other agencies that are going to be involved, and some of the other issues. Thank you.
MR SCOTT: Thank you so much, Connie, and good morning to everyone. Again, members of the media, thank you for joining us. On behalf of my State Department and USAID colleagues, I’d like to thank you very much for joining us this morning for an important discussion on U.S.-Africa trade. We organized this call to emphasize the importance we place on expanding trade and investment between the United States and Africa.
I’d like to give you a couple of more details on the AGOA Forum itself. We have actually – the formal part of it, the government-to-government conversations and with businesses, will start on Wednesday, the 11th, however we already have some events going on today and tomorrow – very important ones.
There’s a private sector forum, a civil society event. An important part of AGOA is participation by civil society partners. There will also be internal trade minister meetings with African trade ministers. So these are two days of meetings that are important. We have a full week ahead of us of AGOA-related activities.
Now, again, AGOA, as Connie mentioned, enacted in 2000. We have seven more years to go. It’s a vital tool which encourages economic integration, promotes inclusive development, and allows us to continue our high-level conversations on trade and investment issues.
We have seen that AGOA works in many different ways. There are the – there’s the formal part, which is more easy to quantify. There are also the very important networks that have been built up over the years, and we’ve seen entrepreneurs and investors and government ministers have a chance to speak throughout the course of the week, and that business is generated that way. And we’ve seen that over and over again.
On statistics, a quick review. Total non-oil goods trade has more than doubled from 13 billion a year since program inception to almost 30 billion a year. Over the last year alone, we’ve seen U.S. trade with Africa climb to 38.5 billion, up from 33 billion in 2016. If you want to quantify it, or a quick snapshot, for every person living on the continent, that’s approximately $5 more.
Africa, as we know, represents a major emerging market of the future. Between now and 2015, roughly half of the world’s population growth will occur in Africa; 1.2 billion new consumers will be added to the market. This population increase will generate not only opportunities for African countries to capitalize on a growing labor force, but will also obviously challenge governments and societies in creating the jobs that are required for this growing labor force. The expansion of trade and investment is critical to meeting this challenge and providing those jobs and capitalizing on Africa’s expanding human capital.
We have seen numerous countries take advantage of the benefits of AGOA. To name a few, Ethiopian exports under AGOA rose 35 percent over the last year to 92 million. Ghana has seen strong exports, quadrupling to more than 300 million. And Madagascar showed strong expansion in its garment exports, growing more than 57 percent to 152 million last year.
Of course, we’d like to see all countries be able to take additional advantage of the program, and that’s why we’re continuing to have these forums to see how we can enable that to happen.
In addition to the benefits of the AGOA program, the United States has a number of other programs that help build the capacity of entrepreneurs and governments to generate economic development. I’ll mention them briefly.
Through USAID’s regional trade and investment hubs, we are helping to reduce impediments to trade and investment. They also provide technical assistance to companies and countries that are looking to enhance their AGOA activities. The Overseas Private Investment Corporation provides financing to support investment projects. The Millennium Challenge Corporation works with partner countries to develop strategic investment and policy reforms to address the binding constraints on economic growth. And the Department of Commerce facilitates commercial linkages between U.S. and African firms.
Just last week, Commerce Secretary Ross led a mission of the President’s Advisory Council on doing business in Africa, PAC-DBIA, on a fact-finding trip to reinforce our commercial relationships in Africa. The trip visited Ethiopia, Kenya, Cote d’Ivoire, and Ghana. I was privileged to participate in the Ethiopia and Kenya legs of the visit, and if anyone has any questions on those, I’d be able to provide additional information on what we saw then.
Finally, we at the Department of State are very proud that we provide constant support to female entrepreneurs through our African Women’s Entrepreneurship Program, or AWEP. Started in 2010, this program provides professional networking, business development, financing, and capacity building opportunities for a network of more than 1,600 women entrepreneurs across Africa.
We are proud to announce that this year’s cohort will participate again in events throughout our AGOA week here at the Department of State. Previous participants of the program have created more than 17,000 jobs on the continent.
I’ll stop there to allow more time for questions. Again, thank you.
MODERATOR: Great. Thank you both. We will now begin the question and answer portion of today’s call. For those asking questions, please state your name and media affiliation and limit yourself to one question related to the topic of today’s briefing, the African Growth and Opportunity Act and U.S. Economic Policy in Africa. For those of you listening to the call in English, please press *1 on your phone to join the question queue. If you are using a speaker phone, you may need to pick up the handset before entering *1. For those of you listening to the call in French and Portuguese, we have received some of your questions submitted in advance by email, and you may continue to submit your questions in English via email to AFMediaHub@state.gov.
Our first question will go to our listening party at U.S. Embassy Kigali, Rwanda. Please, go ahead.
QUESTION: My name is Kamanzi Venuste. I work with a local news website called Umuseke. My question is about the Rwandan issue we hear in Kigali. We hope that the issue of Rwanda will be discussed during this week and during this summit. What could we expect from the discussions between Rwanda and U.S.? As you all know, Rwanda has been, if I may say, removed from AGOA. So what should we expect from the people of Rwanda?
MS HAMILTON: Hi, this is Connie. Let me just say AGOA is – Rwanda is not losing their AGOA benefits. The issue had to do with the out of cycle review that we were doing on used clothing. We had a lot of discussions with the members of the EAC. Other countries decided to change some of the bans that they were putting in place on this product. Rwanda has decided that they want to continue to raise tariffs and ban the product. That’s fine. That’s Rwanda’s decision. It doesn’t mean that we are at odds with Rwanda in terms of our relationship. We continue to work with them on the other aspects of AGOA that they will benefit from. What it does mean, however, is that there is a process in place for the President to make a decision as to what we should do with Rwanda’s decision to continue the ban on U.S. products.
So where we are right now, Rwanda is a member of AGOA. They will be at the AGOA Forum. They will continue to benefit from AGOA. The only issue that we were looking at is whether or not the apparel benefits would continue for Rwanda. It sounds like the government has decided that there are other measures and other steps that they want to take in this regard. That’s fine. That’s a decision that the government can take. We’ve told them the consequences. We will continue to work with them to resolve the issue. If Rwanda wants to continue talking with us about this, our doors are always open.
So we remain engaged. We remain very good friends with our interlocutors in the Rwandan Government. We talk about this a lot. But again, it’s a decision that their government wanted to take and we respect that.
MODERATOR: Okay, great. Thank you. Our next question will go to our colleagues in Addis Ababa. Please, go ahead.
QUESTION: Thank you, ma’am. My name is Birhanu from The Reporter newspaper. I just want to ask – the revitalization and the real significance of AGOA when we see the statistics – for instance back in 2014, the exports of the U.S. to Ethiopia was around $1.6 billion U.S. dollars. When we see the Ethiopian side, it’s just only 300 million. Last year, just – last year U.S. exports to Ethiopia was about 875 million and the Ethiopian side was a little over 290 million or so. Having that – I mean, to have such a trade activity, I don’t think having AGOA is that important, because without AGOA we can have such a trade balance. I don’t see the real impact of AGOA in this scenario, and I just want to have a clear explanation on that regard. Thank you, ma’am.
MS HAMILTON: Just to be clear, because I think sometimes people often look for the data as a sign that there’s a success, and I think that you have to remember that AGOA had a lot of – there are a lot of reasons behind why Congress decided to put AGOA in place. A major reason is to promote trade between the United States and the particular country, but it also does other things. It helped the countries take difficult economic and political steps and rewarded them by providing duty-free access to the U.S. market.
In the case of Ethiopia where I see lots of investor interest, particularly in the apparel sector, I know that there’s a large – and Rob, if you know the name of the particular place where PVH is doing their investment —
MR SCOTT: It’s in one of the business growth areas, but PVH is – yeah, I think 17,000 jobs associated with PVH is my understanding.
MS HAMILTON: So that’s a huge accomplishment for the Ethiopian people to have those jobs being created in a place where many jobs are scarce. So I think that there are things that AGOA brings to the table that aren’t just the trade numbers, how much we’re selling or how much they’re selling. It creates jobs, it creates new opportunity. It supports entrepreneurs who are starting to get into business for the first time. Our trade hubs are there to assist with product development and how to place those products in the United States. We offer all sorts of trade capacity building assistance in terms of what countries are doing to move up the value chain.
All of these are things that happen with AGOA, but one of the biggest things that I think AGOA did: it changed the way Americans think about the African continent in terms of business and investment. As you know, when we first started AGOA back in 2000, we only talked about the conflict. We talked about the problems on the continent. Now we talk about going there as a place to do business, to invest. It sort of grows the relationship beyond just those boundaries.
And let me turn to Rob and see if there’s anything else he wanted to add.
MR SCOTT: Yeah, I think AGOA is part of a puzzle. It’s an important part, but there are a lot of things that go on that support AGOA and that AGOA itself supports. During our visit there we had the pleasure of visiting Ethiopia Airways’ training facility, which is training for airlines across the continent. We visited the – I think one of the largest freight facilities in the world that’s currently coming online. And what you’re seeing is that this will enhance the country’s ability to trade. You’re taking a look also at regulatory reforms, which I believe the government’s looking at right now. And all of that together is building this enabling environment which attracts FDI, because there’s a competition worldwide – the United States competes as well for foreign direct investment dollars.
So I think that what AGOA does as well is it shows that there is engagement, it allows entrepreneurs to gain sophistication and networks, but it’s not a standalone product. And there are a lot of other agencies in the U.S. Government that help support the work. The Department of Transportation takes a look at direct airline connections and freight options. Treasury Department has technical assistance that allows – helps governments in accessing Euro bonds or other ways to access financing, to take a look at their debt loads through their Office of Technical Assistance. U.S. Department of Agriculture does the same thing. They have phylo and photosanitary training processes.
So all of these things come together and create this environment which allows both countries – in this case, Ethiopia and the United States – to trade more with each other. And I think Connie’s exactly right. Trade does go up and down; sometimes it’s situational, but the trend lines have been positive, and we see those continuing.
MS HAMILTON: And if I can just add, the part that you don’t see is the AGOA eligibility process that happens every year. If you’re familiar with AGOA, you know that we have about two pages of criteria that countries are asked to meet to continue to get benefits from year to year. We look at these very, very carefully. In a country like Ethiopia, we may send them warning letters about their human rights issues. As you know, when the state of emergency was being called, we had lots of concerns about what was happening in terms of that, in terms of worker rights, in terms of governance and anti-corruption measures. All of these are things that we push the governments on. Sometimes it happens very quietly and behind the scenes, but I think it’s – it means that your government is making progress in a lot of areas that you may not even be familiar with because of AGOA.
MODERATOR: Great. Our next question goes to Kevin Kelley from Nation Media Group. Please, go ahead, sir.
QUESTION: Yeah, hi. Thanks for doing this today. So I have a question for Ms. Hamilton and also for Mr. Scott. For Ms. Hamilton, I’d just like to get some follow-up, if I could, on what the colleague in Rwanda asked. What’s the timeline for President Trump to make a decision about the impact of – on AGOA of Rwanda’s decision to raise tariffs so substantially on used clothing? And what possible changes in the AGOA relationship could result from the President’s decision? I’ll just leave it there. I hope I can come to the question for Mr. Scott.
MS HAMILTON: Sure. The timeline is by the end of July. So we hope to have something out – a proclamation out by the end of July.
QUESTION: End of July?
MS HAMILTON: Right. If the President decides to take steps, Rwanda could lose their apparel benefits – not all of their benefits under AGOA, but just the apparel benefits. And that would be effective almost immediately.
QUESTION: Sorry, I didn’t hear the last part. Be effective when?
MS HAMILTON: Almost immediately, once the President signs the proclamation.
QUESTION: Okay. It’s very tiny, the apparel benefits that Rwanda currently enjoys under AGOA, right?
MS HAMILTON: Exactly. Yes, I think it’s about 1.2 million a year.
QUESTION: Yeah. So it wouldn’t likely have the effect of dissuading them from going forward with their tariffs on the used clothing?
MS HAMILTON: Well, again, as I said, if that’s the decision that they want to make – remember, there are 40 countries that are currently eligible for AGOA. About 25 actually have the apparel benefit, which means that there are countries that have decided that this is something that they don’t care to do. To get apparel benefits under AGOA, you have to have in place what we call an apparel visa, which says that the countries are not allowing transshipment to occur between other countries and them getting things into the United States.
So 20 or so countries have opted out of that. If Rwanda decides that this is something that they don’t need, that’s Rwanda’s decision.
QUESTION: Mm-hmm. Right. Okay. Can I ask Mr. Scott a question now, too?
MR SCOTT: Sure, go ahead.
QUESTION: Okay, great. Thanks. So you said were in Kenya and Ethiopia for the recent swing on doing business in Africa. Can you say what specifically you discussed in Kenya? I’m wondering – based on the USTR report on AGOA in 2017, Kenya’s made big gains in sending macadamia nuts under AGOA to the U.S., but it looks like the textile trade is kind of stagnant. Can you speak to why that might be so, regarding textiles? And just generally, what was discussed with Kenya regarding AGOA? Thanks.
MR SCOTT: Okay. Sure. I think the PAC-DBIA visit, although it had some relevance to AGOA, obvious relevance to AGOA, it was more U.S. companies going into the market to take a look at what was the environment, some specific deals were signed, and there was an MOU signed with the government between I think it was Under Secretary Gil Kaplan at that time and the minister of trade.
So the focus wasn’t AGOA-specific. On macadamia nuts, I think we’d have to get back to you on that one. I just don’t have those details with – it wasn’t discussed in any of the meetings that I was in. The discussions were more top line. I think there’s a lot of interest in having a direct flight come to the United States with Kenya Airways. There were discussions of other ways in which our business community is able to access the market. A number of deals were signed; I’d refer you to the Department of Commerce website for that. So there were some specific deals that were signed. I don’t want to get them wrong.
But generally speaking, there was – I think the headline meeting was with the president, President Kenyatta, in which he welcomed U.S. investment. And we were very clear in talking about, again, an enabling environment and what U.S. companies were looking for to enter the market. So it was business-to-business, government-to-government, and government-to-business meetings. Not that specific on AGOA, though.
QUESTION: Thank you.
MODERATOR: Thank you. Our next question is one we took over email from – apologies if I get the pronunciation wrong – Wongai Zhangazha from Zimbabwe Independent Newspaper: “How would you describe the United States trade relations with Zimbabwe? Can you compare the commercial relationship from the time when former President Robert Mugabe was in power and now with the current government? And for trade relations to normalize with Zimbabwe, what should the government do to attract U.S. investment?”
MR SCOTT: That’s a good question. I think what we’re all looking for is the elections, and those will be a hugely important signpost for the way forward in our relationship. We’ve been very clear in articulating, as has the international community in general, the hopes and expectations of what will occur in the elections. I think we’ll have to wait and see what happens. I wouldn’t want to go beyond that because, obviously, that will be such an important indicator for what we’re able to do.
I would note that there have been – there’s not a cessation of business relationships between the two countries. There have been business deals that have been struck in some sectors. I think they’re limited, and again, the hope is that if elections go well and the marks are hit, then obviously we’re open to see what’s available. But again, we’re waiting for those election results.
MODERATOR: Thank you. Any comments? Okay. We’ll go back to our embassy in Kigali, Rwanda, if there are any other journalists there that have questions.
QUESTION: Okay, thank you. This is Kamanzi again. I have another question with the – and it is about (inaudible) to USA. RwandAir is a small company, very young. Do you think – maybe what do you think about this young company coming to a competitive market like U.S.?
And finally, maybe to make it clear, some analysts, some people here in Kigali, think that this (inaudible) narrative between – that this trade war, if I may call it, between U.S. – maybe it’s not really a trade war, but this issue between the U.S. and Rwanda on AGOA, does it really have other impacts on maybe investments? As we know, Rwanda is attracting many investments from USA, but people think that it may have other impacts on maybe investments or other trade. Is this really that big? Thank you.
MR SCOTT: I think I can – from what I understood of the first question was the prospects for RwandAir to potentially access the U.S. market, is the way that I understood that.
MR SCOTT: Okay. I think that’s a multi-step process. So I’m not an expert in it, but my understanding would be that should the airline, the government have interest in taking a look at direct flight connections, you’re dealing with the Department of Transportation, TSA, and there’s a long process that one goes to in order to qualify. So I won’t – I don’t want to make any misstatements, but my sense would be that that is something that would – it’s a very explicit, rules-based and benchmark-based process.
MS HAMILTON: Right. I’m not aware that they’ve even started that process, so it could take some time if they’re interested in doing that.
QUESTION: Thank you.
MR SCOTT: And then on your second question, I’m not quite sure we fully understood it. It was about the impact of a potential trade war between the two – as you described it – between the two countries, or —
QUESTION: Yeah, yeah, yeah. Some people are saying that Rwanda – this – I mean, this issue between Rwanda and U.S. on this AGOA, that it may have other impacts, maybe on investments and all the trade between U.S. and Rwanda in general.
MS HAMILTON: I think that those investors that are interested in coming to Rwanda for other products will continue to do that. I think that we’re really talking just about one sector. I know you have some investment in the apparel sector already. I don’t think that folks are packing up and leaving Rwanda because of this step. Again, it’s something that we hope to resolve in the future. We continue to work with Rwanda to try to figure out a way forward that makes both of us satisfied with the outcome, so we’ll keep working on it.
QUESTION: Okay. And what duties – if Rwanda is out of AGOA, would you please tell us, like, duties that the products from Rwanda are hitting?
MS HAMILTON: It’s – varies by product, but we’re talking about for the apparel sector, it can go – I’m not sure if you know the range – it could be as high as 30 percent.
MODERATOR: Thank you.
QUESTION: Thank you.
MODERATOR: Thank you. Our next question will go to our embassy at Addis Ababa if there are any other questions from that listening party.
QUESTION: Thank you very much. I am Leul (ph) from Ethiopian Herald newspaper. My question is that in one way, Trump administration is saying that making Africa – using AGOA, Africa will be a model continent for other developing countries. At the same time, there is also a trade agreement with European Union, and there is a rise of Chinese trade with the continent. So don’t you think these two things will fight with each other? Thank you.
MR SCOTT: I guess your question is just competition, basically – impact between Europe, other traders, China, the United States. Is that the question? Where do we see trade going on the continent, or —
MR SCOTT: Okay. I think it’s an open market, as one says. I think what we are seeing is that there is increased interest from U.S. companies – witness the PAC-DBIA visit to your country and three other countries recently – and they’re evaluating their opportunities for entering the market. A lot of U.S. companies are already in the market. We currently have the highest base of investment on the continent. I think that’s something that is overlooked from time to time, but historically, U.S. companies – and I believe still have the highest level of investment on the continent, and that’s historical if you take a look at investments that have been placed on the continent over time. So there is a very strong base of U.S. companies that are involved on the continent.
I think what we’re seeing and in our visits on the continent – there was an interesting quote that I’ll just pass on when taking a look at U.S. involvement in the markets. And one of our interlocutors on the trip said, “We’re attracted to U.S. companies because we know that cheap can be expensive.” And what he was saying with that was that U.S. companies bring a full package of quality, of corporate good governance, of potential corporate social responsibility projects, and world-class operating standards. So it’s an important process of understanding what it is that a sale or a public tender brings, and I think we believe that our companies are extremely well-positioned to bring value to the continent in their products and their services.
So, again, there is a competition. It’s an open competition. What we’re asking for is a level playing field and access, and we believe that U.S. companies can compete. The corollary to that is that every government is also competing for foreign direct investment so that there’s a competition around the world to attract investments, to prove that there is stability, there are rules-based environments which will attract investment into countries. And the more effective countries are in setting that up, the more you’ll see companies from all around the world compete to get into those markets.
MS HAMILTON: I would just add I think we’ve always – especially regards to AGOA – felt that there are enough needs on the continent that the fact that China and the EU and others are there – that’s not a problem for us. I think that there’s enough that has to be done to help Africa grow and develop that we can all get in and share and help Africa do exactly that. I think that what AGOA brings to the table is it opened the door for a lot of U.S. companies to understand the opportunities but also the challenges on the continent, and I think that the EU certainly had a head start just because of their history. China has been engaged with – on the continent for a very long time; they’re doing lots of infrastructure things. China’s doing things that are countries are not doing in terms of taking risks that other countries are not willing to do.
We understand that, but we do think that, as Rob said, United States brings a certain quality of entrepreneurship to the continent. The way we develop and work with the people there, the labor, the standards that we bring – those are things that I think a lot of our partners on the continent want to see. One of the things that happens whenever a head of state or a trade minister sits down with the trade representative, they always say, “Tell your companies to come and invest.” We hear that no matter where we are, no matter who we’re talking to. That’s the first thing we hear from a trade minister.
And we don’t tell our countries – our companies where to go. You have to build the environment that makes them want to get there. And one of the things that we’ve done with AGOA – the reason why we do have those two pages of eligibility criteria – is to create the conditions that make U.S. investors say, “This is a place where we want to set up shop.”
What we’re trying to do now in this next step, going beyond AGOA, is how do we lock in that success. What can we create, what environment can we put in place, what rules-based system can we give U.S. companies so they say, “This is where I want to be to do business,” so we can invest, we can create jobs, we can benefit and the African partner can benefit? So that’s the next step in this relationship, but there’s room for all of us – for China, for the EU, for India, for everyone who wants to go in and help this continent grow and develop, and I think that’s where we all are.
MODERATOR: Great, thank you. Our next question will be one we took from our listening party in Mali. Mohamed Dagnoko (ph) from the daily Le Combat (ph) asks, “Mali is the leading producer of cotton on the continent. Can you talk a little bit about garments and textiles being eligible for AGOA when the raw material is cotton, and the relationship that the U.S. has with Mali?”
MS HAMILTON: I’m not sure there’s a difference because the raw material is cotton in terms of what you’re producing. Remember, the way AGOA works is a buyer has to decide to purchase the garments that are being sewn in your country. So in the case of Mali, if someone wants T-shirts and they want those T-shirts to be 100 percent cotton, hopefully Mali will develop a textile industry that can provide that cotton to that producer so they can make those T-shirts. I suspect that Mali’s cotton is being turned into other products someplace else, that Mali does not actually have a vertically integrated textile industry so that they can produce those fabrics themselves. That’s the work that has to be done in the future so that Mali’s cotton can go into those products that come to the United States. I don’t think that’s where they are right now.
MODERATOR: Okay, thank you. And our last question goes to Terence Creamer from Creamer Media News. Please, go ahead.
QUESTION: Thanks very much. This is Terence Creamer from Johannesburg. Just if you could give us some insight into what the government-to-government agenda looks like over the next day in terms of the next seven years of the AGOA cycle as well as what might be happening beyond that. What will be America’s message to the governments present or the different parties present?
And also, from an African perspective, with issues such as becoming collateral damage in a possible trade war between China and the U.S., how those fears are going to be dealt with from the U.S. side.
And from a South African perspective in particular, the fact that duties have been imposed on both steel and aluminum products, with aluminum products having previously benefited under AGOA, now facing that additional duty, how that message is going to be carried.
And finally, whether Zimbabwe’s eligibility will come up at all. Thank you.
MS HAMILTON: Let me just start. Just on the last question, Zimbabwe’s eligibility will not be discussed at the AGOA Forum. That’s a different process, and that’s just not part of that discussion.
In terms of the next seven years under AGOA, we remain committed to the AGOA program, to making sure that countries maximize the benefits under the program right now. What we’re saying, though, is that seven years from now, this program is scheduled to expire. We don’t know what Congress is going to do, but let’s say that it does not continue. We think that we should have a plan in place for how we go beyond AGOA. If the program does continue, we don’t believe that AGOA has been the game-changer that has promoted the kind of diversity and broad-based benefits to all the countries that are eligible for the product, so we would still want to go beyond AGOA.
So what Ambassador Lighthizer is going to do is start a conversation with his peers to start talking about what could be the next step for the United States and African countries who are currently benefiting from AGOA. How do we use this seven-year window to come up with a model that we can have in place should AGOA expire so we don’t have a lot of countries flailing about trying to figure out what do we do next.
So that’s sort of the basis for having those conversations. We’re trying to develop a model free trade area agreement that we can apply to any country who’s willing to engage with us, but starting with exploratory talks, just figuring out what’s possible, what are the redlines, what do we need to see, what do our partners need to see, and how do we get there? So we have seven years to figure that out.
I’m going to turn this back.
MR SCOTT: Yeah, just – good question. I think – let me just run a little bit through the kind of things that you’ll see in the coming days. We’ll have the – an opening. Our deputy secretary of state will speak. Ambassador Lighthizer will speak. The minister of commerce from Togo, who hosted the last AGOA Forum on the continent, will speak. And we’re going to have the deputy chairperson from the African Union speak to set the stage and set the agenda.
We then have readouts from the meetings that have taken place today and tomorrow, before Wednesday, which is very important. We’ll hear from the African trade ministers’ consultative meeting. They will be able to approach the group and speak about their priorities, about any issues that they see as being in the forefront between the various trading partners. There will be a private sector meeting readout. Again, we believe that the PAC-DBIA results will probably feature in that, but again, companies can speak to us about what they’re seeing and what they would like to see. And then finally, civil society – very important. Again, they are full partners in this process, as Connie had mentioned, on the labor standards, on the impact of business in their communities and societies. We’ll get readouts from them as well.
And then we go into very specific meetings throughout the course of the next two days. There will be workshops on workforce development labor rights, small business trade through e-commerce, which is becoming increasingly important, obviously. Public procurement and reform; how do we access public projects? Agricultural growth, ag obviously being a hugely important sector; how do we maximize that? Trade facilitation; how to implement the trade facilitation agreement.
So there are a number of workshops throughout the two days which will allow ministers and corporate leaders and civil society actors to engage together to talk about how we can maximize AGOA currently and, as Connie pointed out, how we transition or how we move into other areas over the coming years as trade does evolve. It constantly evolves. How do we take cognizance of that? So I hope that answers your question, but some specifics on what we’ll be talking about.
Finally, real quickly, we anticipate questions – there’s been quite a bit of interest in an OPIC announcement that recently came out announcing a $1 billion Connect Africa initiative. It’s focused on three areas: transportation, IT, and value chains. The head of OPIC currently traveling through Zambia, Rwanda, South Africa, Uganda, and Kenya. That’s another initiative that we’ll be hooking into, and so we’ll have more information to share on that. But if you have a moment to take a look at the OPIC website, there’s more information on what they’re doing on that.
So I’ll stop there. Thank you.
MS HAMILTON: And if I can just – you mentioned the 232 tariffs. Let me just say that the duties were imposed in response to overcapacity fueled by subsidies and other forms of state intervention in countries like China. And although we recognize that the problem does originate in China, its impact is being felt across the world. As loss-making production gets exported widely, it affects the supply chains of third countries and decreases prices across economies.
So what we’re asking from our African partners is, as you’re facing the same challenges we are with China’s overcapacity and how you are dealing with that – but this is an issue. The President did impose these tariffs, and we continue to hope to move this process forward and get through this.
MODERATOR: Great. Thank you so much. Mr. Scott, Ms. Hamilton, do you have any closing remarks before we conclude today’s call?
MR SCOTT: I’d just like to thank everybody who participated in the call. It’s always a good opportunity to share what we’re doing. We’re – it’s a very positive thing that we’ve got coming towards us today and through the rest of the week with the AGOA Forum, and we look forward to each one of the meetings and to wrapping up and to sharing the outcomes with the public.
MS HAMILTON: And I would just say, as Rob says, we’re always very excited about the AGOA Forum. I don’t know any other preference program that gets together the beneficiaries to talk about how to make the program work better, and that’s one of the exciting things about this opportunity. So we’re going to hear a lot from our partners – a lot of complaints, but also I think a lot of compliments on how well it’s doing. And we’re really interested in hearing what they have to say about moving beyond AGOA, so thank you for joining us on this call.
MODERATOR: Thank you so much. That concludes today’s call. I want to thank Robert Scott, Acting Deputy Assistant Secretary for African Economic and Regional Affairs at the U.S. Department of State, and Connie Hamilton, Assistant U.S. Trade Representative for Africa, for joining us, and thank all of our callers for participating. If you have any questions about today’s call, you may contact the Africa Regional Media Hub at AFMediaHub@state.gov. Thank you so much.