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Assessing Ghana’s trade under the African Growth and Opportunity Act (AGOA)

Adagblenya, Barbara Dzidzornu (2017): Assessing Ghana’s trade under the African Growth and Opportunity Act (AGOA).

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The African Growth and Opportunity Act (AGOA) represents a unilateral trade preference between the United States and eligible countries in sub-Saharan Africa. This trade pact, framed under the Generalized System of Preferences of the WTO extends duty-free and quota-free market access to qualified countries. This study seeks to examine the effects of the trade pact on US-Ghana trade. Specifically, it seeks to analyse significant trends in Ghana’s exports to the United States after the enactment of the AGOA Act in 2000. Using primary data obtained through surveys from relevant Ghana government agencies and secondary data from trade organisations including the AGOA website, US Trade department etc. the study analysed and described the effects of the AGOA trade agreement. Results of the study indicated that inherent structural constraints facing Ghanaian exporters, together with limited productive capacities negatively affected the utility of the trade agreement. This limitation reduces significantly the ability of AGOA to influence and reduce poverty as well as positively contribute to growth. The study further noted that uncertainties surrounding expiration of some sections of the agreement hampers long term planning and investments by stakeholders. The writer recommends an aggressive push towards improving exporter capacities, through stakeholder engagement to address challenges inhibiting effective utilization of AGOA trade preferences. This should include investment in productive capacities in order to expand product lines to benefit from existing preferences. Progressive attempts must also focus on sensitizing exporters on US trade rules as well as international trade practices.

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