US President Biden announced the termination of Uganda’s designation as a beneficiary sub-Saharan African country under the African Growth and Opportunity Act (AGOA).
This move, effective January 1, 2024, comes following a determination that Uganda, alongside the Central African Republic, Gabon, and Niger, “does not meet the criteria outlined in section 506A(a)(1) of the Trade Act.”
However, analysts believe it is in response to Uganda’s decision to take a bold move in criminalising homosexuality, a popular sentiment in the East African country.
The decision, signifies a significant shift in Uganda’s trade relations with the United States. This termination signed by Biden on 29th December 2023, impacts the preferential trade treatment that Uganda previously received under the African Growth and Opportunity Act (AGOA).
AGOA, established to enhance trade and economic relations between the United States and eligible sub-Saharan African countries, outlines specific requirements that countries must meet to retain their beneficiary status. The recent determination concluded that Uganda fell short of these criteria, prompting the revocation of its designation.
This decision holds implications for Uganda’s exports to the United States, potentially affecting the tariffs and import restrictions applied to Ugandan goods.
AGOA gives eligible sub-Saharan African countries duty-free access to the US for more than 1,800 products.
Last year, Uganda’s President Yoweri Museveni said that several American companies had already stopped importing textiles – which fall under the Agoa trade deal – from Uganda because of the passing of the anti-homosexuality law.
“The homosexuals in the US are interfering with our export of textiles. Some of the orders have been cancelled there,” President Museveni was quoted as saying by the Daily Monitor newspaper.
In August, Museveni banned the importation of second-hand clothes, a move thought to target the US, which is a major supplier of the used garments to Uganda and other African countries.
As the global economic landscape evolves, such adjustments in trade relations between nations become pivotal in shaping international commerce and fostering mutually beneficial agreements.
