The U.S. and Africa: Current and Future Relationships Presentation by: Florizelle Liser Assistant USTR for Africa

U.S. Trade Policy Toward Africa  AGOA  WTO Cooperation  Trade Capacity Building  High Level Dialogue

AGOA  AGOA extended through 2015 and key to helping boost two-way trade between the United States and sub-Saharan Africa  Continued success under AGOA will depend on countries’ intensified efforts to promote greater diversification of AGOA trade  Also supporting reform efforts in Africa and generating new investments

AGOA Eligibility  Congress established criteria – “continual progress” toward rule of law, open markets, poverty reduction, labor rights, etc.  Annual review process; input welcome  Has resulted in some countries being added, some dropped, e.g. Liberia  38 countries now eligible

U.S. Trade with Sub-Saharan Africa

AGOA Non-Oil Trade Trends

Agriculture  AGOA agricultural exports are increasing – more countries and more products, totaling $361 million in 2006 – a 33% increase over 2005  Since placing APHIS experts at the regional hubs, 5 products have gone through pest risk assessments (PRAs), & another 10 are in the pipeline  South Africa most diverse in raw & processed agricultural exports under AGOA – sending everything from fresh citrus, to wine, to macadamia nuts

Rwanda Coffee  With USAID help, moved up value chain from green beans to high-quality specialty coffee  Coffee exports tripled in last 3 years; $6.5 million in 2006

Rwandan Peace Baskets at Macy’s  Macy’s Showcases in NY Store and on Internet  Made by Genocide Survivors, mostly from rural areas  Not just Christmas sales – ongoing partnership  Women get one-third of retail price  USAID, USADF and Nairobi Trade Hub Involved

East African Cut Flowers  EU is now main market, but exports to U.S. growing, up 19% in 2006, to $3 million  USAID assisting  Transport challenges  Kenya, Ethiopia, Uganda, and South Africa exported in 2006

African Cut Flowers at Macy’s  African flowers at Macy’s annual Flower Show  Over 400,000 visitors viewed exhibit of diverse African flowers  Including two 18ft high giraffes made entirely of flowers  A lush centerpiece of African trees, flowers, and plants

Cashews from Mozambique  Used to export raw cashew nuts to India for processing. Cashews processed in India were, in turn, exported to the United States  With the support of USAID and Technoserve, Mozambique is now shipping processed cashews directly to United States and adding more value  US TCB helped to set up cooperatives, produce, distribute, brand, and market the cashews  Total cashew imports from Africa up 73% in 2006, reaching nearly $11 million

Tuna from Mauritius  In 2006, Mauritius exported its first AGOA exports of processed tuna “loins”  Visited new multi-million dollar tuna processing plant that employs 1,400 people  Tuna loins are now the second largest Mauritian export to the United States after textiles and apparel  For three years, AGOA hubs have worked with African fish processors bringing more than eight companies to the annual Boston Seafood Show

Organic Cotton T-Shirts from Uganda  In February 2007, first shipment under AGOA of high-end 100% organic T-shirts from Uganda  Example of vertical integration  Opportunities with organic cotton

Jeans from Mauritius  High-end jeans from a new vertically-integrated factory  The factory imports cotton from West Africa, produces the yarn and fabric, cuts, and sews jeans  Vertical integration allows for greater competitiveness  Also reduces the need for and reliance on third-country fabric

Men’s Sports Jersey from Ethiopia   Ethiopia not previously apparel exporter to U.S. but has seen exports rise in each of last 5 years  Much investment in sector from within Ethiopia or from expatriates  Production-sharing among small firms

Shirts from Madagascar (Eddie Bauer/Tommy Hillfiger)  Madagascar is producing high- end, high-quality shirts  Malagasy apparel firms are targeting specific niches in order to compete with China  One such niche is high-quality shirts that require special detail requirements

AGOA Stimulating Investment  $100s of millions in AGOA-related investment  Apparel, textiles, as well as autos, seafood, & agribusiness  SSA less than 1 percent of U.S FDI  In 2005, US FDI totaled $14.8 billion, up 16%  More U.S. direct investment would support trade with the region and enhance U.S.-African business partnerships

Cooperation on WTO Doha Round  U.S. committed to trade-expanding agreement  Africa has much at stake -- declining share of trade  Main development outcome is new trade flows, esp. South- South trade  Cotton: pursuing on two tracks  Duty-Free/Quota-Free: African input on implementation

Trade Capacity Building  Access to markets alone insufficient to simulate increased trade  TCB essential to diversify African trade globally and with the United States  $394 million for SSA in FY2006. Over a billion dollars since 2001  AGCI: $200 million, 5-year program  Trade Hubs  Export Diversification Workshops  Need to integrate trade into development strategies

High Level Dialogue  AGOA Forum encourages high-level dialogue on new policies and initiatives that could promote mutually beneficial trade and economic development under AGOA  Next AGOA Forum on July in Accra Ghana, with theme, “As Trade Grows, Africa Prospers: Optimizing Benefits Under AGOA”

What You Can Do  When delegations visit, arrange for visits outside of Washington to meet with U.S. businesspeople.  Know the top 5 products the U.S. imports from your country and be familiar with the major importers. Develop a strategy for identifying new prospective buyers of your products.  Get schedules of U.S. trade shows for buyers: the Boston seafood show, the Miami flower show, the MAGIC apparel show, the New York gift show -- and get your entrepreneurs there. Be sure their presentations are ready for a global stage.  Encourage your governments to update their AGOA strategies to reflect the dynamic trade environment. How many countries are poised to take advantage of the new AGOA 4 textile benefits? How many took advantage of ethnic prints in AGOA 3?  New information is becoming available all the time on African competitiveness issues. For example, the ITC study I mentioned earlier. Feed this information back into your government’s AGOA strategy.  For those of you with TIFAs, make sure follow up occurs on action items.  For those of you from countries who are not in AGOA: Be familiar with the impediments to eligibility and meet regularly with U.S. government agencies to discuss possible ways forward, and then relay this back to key officials in your capitals.