The American Chamber of Commerce in Ethiopia (AmCham Ethiopia), has asked the US and Ethiopian governments and policymakers not to rush to revoke Ethiopia form the list of the privileged countries that has granted an access to export products to the United States (US) market under the African Growth and Opportunity Act (AGOA).
AGOA trade program provides duty-free access for 38 Sub-Saharan African countries to export their product to the US on the conditions that they required to meet a certain eligibility criteria’s, such as eliminating barriers to the US products.
However, in the past few months, due to the ongoing the war in Tigray and its subsequent humanitarian crisis, there is growing pressure from pro-Tigray People’s Liberation Front (TPLF) supporters and some lobbyists pushing for the termination of this commercial privilege.
Furthermore, the, these businesses also worried the latest Executive Order to establish a new sanction regime in Ethiopia might affect their further business activity in the country.
In this regard, Ethiopian-based business leaders have expressed their concerns regarding the possibility of delisting Ethiopia from AGOA.
In a press conference held on Wednesday, Ermias Eshetu, Amcham President, Bethlehem Tilahun, soleRebels Founder, and Zemedeneh Nigatu, Fairfax Africa Fund Global Chairman, urged all relevant stakeholders to positively engage in the sustainable trade relationship between the US and Ethiopia to sustain the AGOA privilege.
“We are very concerned that if the American government evokes Ethiopia form this opportunity, it will hurt many Ethiopians as well as bigger companies who have already invested and aspiring to invest in Ethiopia,” said Ermias.
Moreover, Ermias urged both governments to ease the political tensions and to save what he described as a “significant economic damage.”
“Ethiopian companies are providing affordable products to the US market, so in this regard it is visible that the US itself is benefiting from this opportunity,” highlighted Bethlehem, and calls on both sides to see the positive aspects of the trade relation between the two.
“Apart form this, if we are looking at the composition of the employees at Industrial Parks in Ethiopia, the largest number are women, therefore the lives of these women should not be interrupted due to this tension,” Bethlehem added.
“Though, there is still a multi-billion dollar export privilege given to Ethiopia, so far the country has exported very little products,” said Zemedeneh, noting his frustration if companies investing in Ethiopia once relocate their industries to other countries, “it might take years to return them back.”
According to Zemedemeh, if companies that get a privilege through AGOA change their industrial location to other eligible countries, it will directly or indirectly affect the life of at least one million Ethiopians.
Furthermore, “revoking Ethiopia from AGOA privilege will also impact the current nascent economic strategy in Ethiopia,” said Zemedeneh, and appeals to the US government not to take any measures against this privilege.
Data showed that despite Ethiopia not fully benefiting from the AGOA platform, businesses have exported over USD 114 million worth of commodities just in the 2020/2021 fiscal years through the AGOA.
AGOA eligible countries have 30 percent more advantage when exporting to the US than non-eligible countries.
“While giving poverty alleviation assistance to Ethiopia, revoking this opportunity is not logical for the US government, we don’t need thousands of Ethiopians permanently unemployed,” Zemedeneh laments and requesting the US officials to consider their decision.
The US government announced that it is going to announce its decision before November 1, 2021, whether Ethiopia will be part of the AGOA or not. Companies that are currently investing in Ethiopia have created close to 230,000 job opportunities, largely women.
Amcham was formed to strengthen and continue the century-old Ethio-US friendship and economic ties that have existed between the two countries as well as to support and encourage the business community to better familiarize them to each other.