How Africa Can Overcome AGOA Expiration Impact - Report

The expiration of the African Growth and Opportunity Act (AGOA) policy has left some unanswered questions, including how the African economies can sustain the trade gains.

It also raises concern about how the continent can reposition itself in a post-AGOA environment.

A report released by the Bashir Adeniyi Centre for International Trade and Investment (BACITI) of the Nigerian Institute of International Affairs (NIIA), shared with Pinnacle Daily, raises concerns about AGOA and proffers some suggestions.

On September 30, 2025, the AGOA trade agreement between the US and African countries expired after nearly 25 years. It began on May 18, 2000, and has been at the core of US economic policy and commercial engagement with Africa. It defined US-Africa trade relations and granted duty-free access that expanded markets but also deepened the continent’s reliance on oil exports.

Now that the prospect of renewal seems to have faded, the question of how Africa is prepared for a post-AGOA era remains a concern.

In its report, BACITI noted that between 2000 and 2010, exports from AGOA‐eligible countries to the US nearly tripled, rising from about $22 billion to $61 billion.

In 2022, AGOA beneficiaries exported about $2.9 billion worth of agricultural goods to the U.S., a significant increase from about $750 million in 2000, even as vehicle exports from South Africa increased from about $150 million in 2000 to about $2.2 billion in 2013.

Uneven trade dominance

During the period, trade was largely dominated by the US, reflecting a strong dependence on commodity exports, particularly hydrocarbons.

The report stated that between 2001 and 2008, US imports from Sub-Saharan Africa rose from $8.2 billion to $66.3 billion, driven largely by crude oil exports from Nigeria, Angola, and Chad. This was the period of high global oil prices.

At its peak, mineral fuels accounted for over 85% of total AGOA exports; however, following the 2008 global financial crisis and the subsequent US shale oil boom, demand for African crude declined.

Specifically, in 2024, AGOA trade volumes fell to $14.3 billion and have remained subdued till the expiration of the trade deal. But US exports to the region held steady between $6 and $10 billion annually.

According to the report, African exports did not substantially diversify, as non-oil exports were not sufficient to offset commodity dependence.

“The result is a long-term pattern of volatility tied to global oil prices rather than structural transformation,” it stated.

Challenges encountered

The report highlighted that the sub-Saharan African countries were overly reliant on oil, as most AGOA-eligible countries did not significantly diversify exports.

It noted that only a handful, particularly Kenya, Lesotho, Ethiopia, and Madagascar, developed sustained apparel and agro-processing export bases.

Another issue that limited the programme’s developmental impact is the high production costs, unreliable electricity, inefficient ports, logistics bottlenecks, and limited access to industrial input markets, which weakened competitiveness relative to Asian exporters.

Other challenges faced were that the weak quality infrastructure and limited certification capacity hindered compliance with US sanitary, phytosanitary, and technical standards, particularly in agriculture and textiles, adding that many sub-Saharan African countries lacked coherent national AGOA strategies, with fragmented regulatory frameworks and insufficient export promotion support for SMEs.

Expectations, way forward

With high anticipation for the AGOA renewal, the report suggested African countries must reposition themselves to maximise their potential benefits or transition effectively should the framework evolve.

It further proposed, among others, that African policies should link AGOA opportunities to sector-specific value chain development, skills upgrading, and SME export readiness and invest in productive and trade infrastructure, stressing that reliable power supply, efficient ports, logistics corridors, and industrial zones are essential for competitive production.

It warned that the same constraints that limited AGOA’s impact could also undermine AfCFTA implementation. Addressing them serves both agendas.

“Africa’s challenge is not simply whether AGOA is renewed, but whether the region strengthens the structural and productive capabilities necessary to utilise such preferential access meaningfully. The future of Africa–US trade will be shaped less in Washington, DC, and more in African production hubs, industrial parks, farms, ports, and policy institutions.

“With targeted reforms and strategic alignment with AfCFTA’s industrialisation agenda, SSA countries can shift from a commodity-dependent model to one driven by value addition, competitiveness, and sustainable growth,” the report added.

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