Etienne Fakaba Sissoko

Moving from a logic of aid to a logic of autonomy for our states

 Economist Etienne Fakaba Sissoko examines the immediate consequences of AGOA’s discontinuation, and asks whether African nations such as Kenya wasted the 25-year AGOA grace period, and explores strategic pathways forward. While the expiration poses significant challenges, for labor-intensive sectors like textiles, it also creates an imperative for African nations to accelerate economic diversification, strengthen regional integration through the AfCFTA, and build more resilient, self-sufficient economies.

Introduction

The African Growth and Opportunity Act (AGOA), the cornerstone of US-Africa trade relations for 25 years, has expired without renewal as of September 30, 2025. This non-reciprocal trade preference program, established in 2000, granted eligible sub-Saharan African countries duty-free access to the US market for over 1,800 products. The program’s expiration represents a pivotal moment for African economies, raising fundamental questions about their future trajectory, tariff shocks, and vulnerable industries. As of now the era of AGOA is at an end.

Compounded Tariff Burdens

The expiration of AGOA creates a compounded trade barrier for African exporters, who now face Most-Favored-Nation (MFN) tariffs in addition to recent country-specific tariffs imposed by the Trump administration. This double burden creates a sudden jump in tariffs that could disrupt long-standing trade relations and severely disadvantage African exporters. The impact varies by country but is particularly severe for nations with recently imposed higher country-specific tariffs including:

  • Kenya: Trade-weighted average US tariff triples from 10 per cent to 28 per cent
  • Madagascar: Tariffs double to 23 per cent
  • Lesotho: Faces tariffs of 15 per cent on textile exports, reduced from an initial threatened 50 per cent

Sectoral Vulnerabilities and Job Losses

The expiration disproportionately affects labor-intensive manufacturing sectors that had benefited most from preferential access. The International Trade Center projects that AGOA’s lapse will reduce exports from beneficiary countries by an additional 0.6 percentage points ($189 million) by 2029, with the apparel and textile sector accounting for $138 million of this decline. The most affected sectors include:

Table: Projected Export Declines Due to AGOA Expiration

 

Sector                                 Projected Decline by 2029                       Tariff Increase

_______________________________________________________________________

Apparel & Textiles                          9.7 per cent                                   +14 percentage points

Skins, Leather & Footwear           3.3 per cent                                   +4.3 percentage points

Processed Food & Animal Feed   1.6 per cent                                   +2.4 percentage points

Vehicles                                           1.3 per cent                                                      –

_______________________________________________________________________

Source: International Trade Center

These sectoral impacts translate directly into substantial job losses across the continent. Kenya’s apparel sector alone supports approximately 66,800 direct jobs, predominantly for women and young people. The International Trade Union Confederation Africa warns that up to 1.3 million indirect jobs could be at risk continent-wide. Beyond statistics, these job losses have profound human consequences, as illustrated by Julia Shigadi, a machinist at United Aryan in Nairobi, who stated: “This has been my bread and butter. I only depend on this job—so if it is gone, it means my life is gone too”.

Mixed Results during AGOA’s 25-Year Grace Period

The narrative that African nations completely wasted the 25-year grace period requires nuance. Several countries achieved significant export growth and industrial development in specific sectors under AGOA. Kenya emerged as the top exporter of textile and apparel products to the US under AGOA in 2024, with exports exceeding $530 million. The country’s apparel industry grew from approximately $50 million when AGOA was introduced to around $500 million today. Similarly, Lesotho developed a substantial textile industry that employs approximately 40,000 people, predominantly women. These export processing zones became important sources of employment, particularly for young people in challenging economic environments.

Structural Limitations and Underutilization

Despite these successes, AGOA’s overall impact was limited by several structural factors. The program suffered from uneven utilization across beneficiaries and products, with not all African countries managing to successfully harness AGOA to diversify their exports away from primary commodities. The concentration of benefits in specific sectors and countries meant that many nations saw limited gains. As researcher Zoryana Olekseyuk noted, AGOA’s success rate was “a bit of a mixed bag,” with the overall effect for the region being limited and impacts varying significantly from country to country and sector to sector.

Several factors constrained fuller utilization of AGOA benefits including:

  • infrastructure deficits: High power costs, unreliable water supply, and logistics challenges increased production costs
  • Supply chain limitations: Dependence on imported inputs for minor components like buttons and zippers limited backward integration
  • Bureaucratic complexities: The requirement that eligible countries be re-certified each year created uncertainty that deterred long-term investments
  • Market concentration: Overreliance on the US market made economies vulnerable to precisely the policy shift now occurring

These limitations reflect not necessarily a waste of the grace period but rather the complex challenges of industrial transformation within a preference-based trading system that lacked guaranteed longevity.

Strategic Responses from Crisis to Opportunity

 Accelerate Economic Integration

The AGOA expiration creates renewed urgency to accelerate African economic integration and fully implement the African Continental Free Trade Area (AfCFTA), which establishes a market of 1.4 billion people. As trade expert Teniola Tayo notes, “When Africans trade amongst themselves, they tend to produce higher-value goods, more manufactured goods versus simply exporting raw materials”. The AfCFTA provides a platform for African businesses to achieve economies of scale, develop regional value chains, and reduce external market dependencies. However, implementation has been slow, with one observer noting the agreement “is in creche, not even at university”, highlighting the need for accelerated operationalization.

Diversify Trade Partnerships

African nations should pursue strategic diversification of trade relationships to reduce overreliance on any single partner. Promising alternatives include:

China which recently abolished tariffs for 33 African countries and saw trade with Africa reach $295 billion in 2024. The European Union remains an important partner via Economic Partnership Agreements (EPAs), while emerging partners such as India, Turkey, Brazil, and Russia are strengthening their economic presence in Africa. Consultant Mamady Kamara warns, the challenge lies in negotiating “balanced agreements that actually promote local value creation” rather than replacing old dependencies with new ones.

Develop Bilateral and Sectoral Agreements

The US market remains valuable, and African countries should pursue targeted bilateral arrangements where feasible. Kenya is actively negotiating a bilateral trade pact with the US that could be signed by the end of 2025. Similarly, sectoral agreements focusing on areas of mutual interest, such as critical minerals, represent another pathway. The Trump administration has expressed interest in securing supplies of strategic mineral resources like cobalt, manganese, and graphite, creating potential alignment with African mineral producers.

Strengthen Domestic Industrial Capabilities

African governments must address structural constraints that hamper competitiveness. Kenya’s government is actively working to reduce power costs for manufacturers, improve water access, streamline customs clearance through digital systems, and develop relevant technical skills through TVET partnerships. Equally important is fostering backward integration by developing local supply chains. As Kenya’s Cabinet Secretary for Investments, Trade and Industry challenged industry players, there is need to “reduce reliance on imports for minor inputs such as buttons and zippers, urging firms to integrate local value chains”.

Strategic Repositioning in Global Value Chains

The AGOA expiration creates an imperative to move beyond raw material exports toward higher value-added production. As economist Hod Anyigba emphasizes, Africa must ensure that “value is created on the continent. We must not become net exporters of raw materials, but also manufacturers, processing goods, so we can retain value on the continent”. This transition requires policies that support industrial upgrading, technology transfer, and skills development to enable African producers to capture more value within global supply chains.

Conclusion: From Dependence to Self-Determination

The expiration of AGOA represents both a significant challenge and a historic opportunity for African nations. While the immediate tariff impacts will disrupt trade and threaten jobs in AGOA-dependent sectors, this moment creates an imperative to accelerate the building of more resilient, diversified economies. The 25-year AGOA era produced both successes and disappointments, but its ultimate legacy will be determined by how African nations respond to its conclusion.

The path forward requires pragmatic multilateralism—strengthening African economic integration through AfCFTA while strategically engaging with diverse global partners. It demands internal reforms to address infrastructure deficits, bureaucratic inefficiencies, and skills gaps. Most importantly, it necessitates a fundamental mindset shift from what Malian economist Etienne Fakaba Sissoko describes as moving “from a logic of aid to a logic of autonomy for our states”.

In this context, the AGOA expiration is not merely the end of a trade preference program but a potential catalyst for Africa’s economic coming of age. By leveraging this moment to build more integrated, diversified, and value-creating economies, African nations can transform a short-term crisis into long-term opportunity, finally unleashing the continent’s full economic potential on their own terms – Moving the continent’s economies away from fear and dependency to self-determination propelled by blinding ambition to create a future for its people and make a significant contribution to the global economy.