Text: USTR Sends Africa Trade Report to Congress

Executive affirms Bush support for AGOA

The office of the U.S. Trade Representative recently submitted its annual report to Congress required by the African Growth and Opportunity Act (AGOA), in which it stated that the Bush Administration "strongly supports the AGOA and a vigorous trade policy approach toward Africa. It is committed to ensuring that the AGOA provides maximum benefit to both Americans and Africans."

Following is the text of the executive summary to the USTR report:

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I am pleased to submit to the Congress the first President's Comprehensive Report on U.S. Trade and Investment Policy Toward sub-Saharan Africa and Implementation of the African Growth and Opportunity Act (AGOA).

The AGOA establishes a new framework for U.S. trade, investment and development policy for sub-Saharan Africa. The Administration plans to fully implement the AGOA and to broaden and deepen U.S. relations with the countries of sub-Saharan Africa. The Administration will pursue a strategy to expand free markets, trade, and economic growth in sub-Saharan Africa. Achieving these objectives will benefit the United States and sub-Saharan African countries by helping to create healthier more stable economies, stronger, more democratic governments in Africa, and expanded markets for U.S. exports. Expanding trade with Africa supports the values and policy objectives of this Administration, to promote economic development and political freedom and stability in the poorest regions of the world. The interdependence of economies should help us all to appreciate that global prosperity in the long run will be more secure if broadly shared. In working toward these aims, the Administration hopes to build on the bi-partisan Congressional support for the AGOA to create an Executive-Congressional partnership on Africa trade, investment and development policy.

There also is a recognition that U.S. policy toward Africa can best be pursued in cooperation with sub-Saharan African countries, with our initiatives and efforts fostering, supporting, and complementing their work and objectives. The Administration is encouraged by the actions of many sub-Saharan African countries that are implementing difficult economic, political, and social reforms and seeking to strengthen trade relations and business ties with the United States. African leaders have a new sense of ownership of their future and how to achieve that vision. A number of leaders have taken new responsibility for moving their countries forward, acknowledging problems and challenges but realizing that they, Africans, must lead the way. Governments are acknowledging that corruption and governance issues must be tackled and that it is their responsibility to do so. At the same time, they are looking to the United States, and to others, for assistance in helping them achieve their visions for a more stable, economically sound, and democratic region. The United States welcomes this new dynamic.

The AGOA reflects the United States' recognition of the significance of sub-Saharan Africa.

While the AGOA is a cornerstone of U.S. trade, investment, and development policy for sub-Saharan Africa, there are many other facets of this policy. The challenges facing sub-Saharan Africa are many. Although economic growth in the region has improved, it still lags behind that of other regions of the world. Many sub-Saharan African economies continue to depend on exports of a few commodities for the vast majority of their export earnings, making their economies more vulnerable than those of other developing countries with more diversified economies. In 2000, rising oil prices helped some countries while others faced deteriorating terms of trade. Sub-Saharan African countries are still in the process of implementing the reforms necessary to create a fully open and market-based economic system. Corruption and governance issues, inadequate infrastructure, as well as conflict remain major impediments to both domestic and external investment as well as trade. Adding to these issues is the devastating impact of the HIV/AIDS pandemic and other infectious diseases.

Most sub-Saharan African countries will still need assistance to take advantage of trade opportunities such as those offered by the AGOA. As the volume of global trade tripled in the past two decades, sub-Saharan Africa's volume of trade and share of world trade continued to decline, increasing Africa's marginalization in the global economy and excluding the region from growing world prosperity. Intra-African trade is well below averages for other regions of the world. Capital flight as well as a drain of experienced and skilled workers remain problems, as does the low level of savings and investment in almost all sub-Saharan African countries.

The Administration is committed to engaging actively with African countries on trade, investment, and development. The Administration's programs and initiatives will be further developed and enhanced to most effectively target the challenges facing sub-Saharan Africa and to support sub-Saharan African efforts. The Administration will explore means of further liberalizing trade with sub-Saharan African countries, including the possibility of free trade agreements, new Trade and Investment Framework Agreements, promotion of AGOA opportunities, and enhanced and targeted technical assistance and capacity building programs. The Administration strongly supports the AGOA and a vigorous trade policy approach toward Africa. It is committed to ensuring that the AGOA provides maximum benefit to both Americans and Africans."

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