Saturday, May 25, 2024

Has Botswana fully taken advantage of AGOA?

A few years ago the United States government came up with an initiative that would allow sub-Saharan African countries access into the large and lucrative American market.

At the instance of President George W. Bush the American Congress came up with a law making specific preferences for certain goods that could be trade to the sub-Sahara.

It was an unprecedented intuitive in that it should boldness in its flexibility while also showing humanity in its preferential treatment of Africa as a continent.

The initiative dubbed Africa Growth and opportunity Act (AGOA) was intended to draft African countries out of poverty and create jobs for the struggling millions in the continent.

It was clear that poverty was at the heart of many ills bedeviling the continent.
AGOA was a shot in the arm for many economies in Southern Africa.

Countries like Lesotho and Swaziland, it must be admitted took full advantage of AGOA.

The benefits of AGOA revolutionised the economies of Swaziland especially, where thousands of jobs were created and for the first time the country found its economy showing discernible diversification away from traditional products like sugar.
For Botswana the benefits have not been as particularly apparent.

There are many reasons for it. From the start Botswana made a mistake in that a misperception was created that AGOA was limited only to textile or apparel.

The truth though is that under AGOA the list of goods that could be exported into the United States under the arrangements runs into hundreds.

Even accepting that it was prudent to focus on textile there is no evidence to suggest that we put in place the necessary structures like marketing and linkages with the American buyers so as to put ourselves on a higher pedestal.
Instead our business people were consumed by the usual lethargy of entitlement .

There is also no evidence to suggest that we applied ourselves sufficient enough or expended enough resources to do due diligence on the quality of material that the Americans would find acceptable.

The same, we would add was not done to evaluate prices. This is especially important when looked against the fiercely competitive prices offered by many Asian prices especially China and Bangladesh where textile industry is still characterized by pervasive slave wages.

We are of the view that AGOA was a rare opportunity offered to Africa under very friendly terms which in the face of growing globalization and strict rule-based World Trade Organisation it is unlikely to ever be repeated again when the round comes to its statutory end.

It may just be the time that government of Botswana instituted an evaluation of the country’s response to AGOA so far with a view to coming up with a framework that would enhance better responsiveness in the future should a similar opportunity arise.
It is also important to know just how the country benefited from AGOA or if it did not, how we lost out as a country.

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