…as continent presses panic button over America’s continued delay to extend AGOA
Mohalenyane Phakela
Lesotho’s textile industry faces massive job losses if the American government does not renew the African Growth and Opportunity Act (AGOA) by the end of this month, Trade minister Sk’hulumi Ntsoale warned this week.
The American government signed AGOA into law in May 2000 to allow certain goods produced in eligible countries duty-free entry into the country.
Initially, the legislation was set to expire in 2008, but the United States Congress passed the AGOA Acceleration Act of 2004, which extended it to September 2015.
As of August 2014, 41 sub-Saharan African countries were eligible for AGOA benefits, among them Lesotho.
However, according to Mr Ntsoale, if the Americans fail to renew the agreement by the end of this year, 45 000 jobs would be lost in Lesotho’s textile industry, which is the country’s biggest private-sector employer.
Mr Ntsoale, who has since been appointed to lead an African delegation to America next week to plead for the immediate extension of the legislation, told a media conference held in Maseru this week that failure to renew AGOA would have disastrous consequences for Lesotho.
The minister, who said he received the appointment during the 9th conference of African Trade Ministers held in Addis Ababa, Ethiopia last week, explained why the Americans need to explain their stance on AGOA as a matter of urgency.
“The United States is the major market that Lesotho serves via Thetsane, Maseru and Maputsoe textile industries. This is all made possible by AGOA that we have had with the US government since 2004 and is set to expire in September 2015, which will result in the loss of 38 000 to 45 000 jobs,” Mr Ntsoale said.
“I have been appointed by African countries to lead a delegation to the US and try to persuade the American government to extend the agreement beyond 2015 and by a minimum of 15 years.
“The window for a seamless re-authorisation of AGOA closes at the end of this month. The importance of AGOA, in particular as a policy instrument to strengthen and enhance African-US trade and economic relations, will support Africa’s economic transformation and deepen continental integration.”
The minister further lamented Lesotho’s failure to take advantage of the many opportunities presented through AGOA.
“There are up to 6000 opportunities presented by AGOA and Lesotho is only utilising one, which is textile production.
“We have a very rich country in terms of agriculture, so we need to development this sector so that producers can also have access to the US market. We are already proud of the production of trout, cherries and apples in our country. All we need to do is ensure their consistency and growth.”
The minister also said government was looking at diversifying markets to ensure the country does not depend on a single market.
