The Somali government officially applied to join the 36 African countries on Thursday, benefiting from the African Growth and Opportunity Act (AGOA).
The announcement was made during the Somalia AGOA application ceremony, where outgoing U.S. Ambassador to Somalia, Larry André, highlighted the United States’ commitment to expanding and modernizing partnerships in Africa and Somalia.
Ambassador André emphasized that the U.S. will focus on working with Somalia and its people to find innovative solutions to new and long-standing challenges, harness new research and technologies, and invest in long-term sources of strength while addressing immediate needs.
Since its passage by the U.S. Congress in 2000, the African Growth and Opportunity Act has been at the core of U.S. economic policy and commercial engagement with Africa. According to Ambassador André, AGOA will enable Somalia to export its products to the U.S. market with significantly reduced trade barriers.
However, to meet AGOA’s rigorous eligibility requirements, Somalia must make further progress in establishing a market-based economy, the rule of law, political pluralism, and the right to due process. Additionally, Somalia is expected to enact policies to reduce poverty, combat corruption, and protect human rights.
Ambassador André said, “These policies will create a stable and predictable environment for businesses to operate in and help ensure that resources are used effectively and efficiently. With all of this in mind, the Embassy is honored to provide a link between the Federal Government of Somalia and the U.S. Trade Representative.”
Somalia’s eligibility to join AGOA will be determined through an assessment process.
U.S. President Joe Biden recently signed a 10-year extension to AGOA, a key trade policy first introduced by President Bill Clinton in 2000. This extension guarantees that AGOA, which offers duty-free access for over 6,000 products from sub-Saharan Africa to the U.S. market, will not expire in 2025.
African Growth and Opportunity Act (AGOA)
Background
The African Growth and Opportunity Act (AGOA) provides duty-free treatment to goods of designated sub-Saharan African countries (SSAs). The program dates from 2000 and has the goal of promoting economic growth through good governance and free markets. It covers non-textile as well as textile goods and was most recently re-authorized through September 30, 2025.
Eligibility
Some 5,240 tariff items are eligible for AGOA benefits. In order to benefit from AGOA, a good must be either wholly obtained (grown, fished, mined, etc.) or sufficiently manufactured in an AGOA country. Sufficiently manufactured means that all 3rd-country materials have undergone a substantial transformation and at least 35% of the good’s value is added in the beneficiary country, with up to 15% of that value attributable to U.S. inputs. Additionally, the good must be “imported directly”.
Merchandise Processing Fee
Per 19 CFR 24.23(c)(1), textile goods, which are entered using HTSUS 9819, and all goods of Least Developed Beneficiary Developing Countries (LDBDCs) (HTSUS General Note 4(b)(i)) are exempt from merchandise processing fee (MPF).
Special Program Indicator
Beginning in 2017 eligible tariff items are identified by the symbol “D” in the “Special” sub-column of the HTSUS.
Citations and Resources
- Prosper Africa: Prosper Africa is a U.S. Government initiative to increase two-way trade and investment between the U.S. and countries in Africa. Prosper Africa brings together services and resources from across the U.S. Government to empower businesses and investors with market insights, deal support, financing opportunities, and solutions to strengthen business climates.
- HTSUS General Note 16
- Regulations19 CFR 10.171, 10.173 – 10.178; 19 CFR 10.178a; 19 CFR 10.211 – 10.217
- “Imported directly” is defined in 19 CFR 10.175
- 19 USC 2462– Designation of Beneficiary Developing Countries
- Public Law 106–200 106th Congress– Trade and Development Act of 2000
- R. 1295– Trade Preferences Extension Act of 2015
- AGOAon USTR Website
- AGOAon US International Trade Administration Website
- CBP Informed Compliance Publication: What Every Member of the Trade Community Should Know About: African Growth and Opportunity Act(2003)
- Request for Public Comments, AGOA Annual Review of Country Eligibility for Calendar Year 2017
Website: https://agoa.info/
