I appreciate the opportunity to submit these comments on behalf of National Taxpayers Union (NTU), a non-partisan citizen group founded in 1969 to work for less burdensome taxes, more efficient, accountable government, and stronger rights for all taxpayers. More about our work as a non-profit grassroots organization is available at www.ntu.org.
Trade preference programs like the African Growth and Opportunity Act (AGOA) encourage mutually beneficial transactions between Americans and our trading partners. As an organization dedicated to the rights of taxpayers, NTU supports AGOA as an alternative to costly foreign aid programs.
AGOA supports people in African nations by encouraging mutually beneficial trade instead as an alternative to foreign aid programs. Reducing barriers to imports from beneficiary countries also encourages U.S. exports of agricultural products and other goods. This is especially important due to the failure of the United States to negotiate new market-opening free trade agreements in recent years.
NTU encourages long-term reauthorization of AGOA. We also urge Congress to improve the program to better promote U.S. interests and to reject proposals that would weaken AGOA.
Examples of how to get the most from AGOA include:
- Reauthorize AGOA on a permanent basis or, at a minimum, provide for a long-term extension. Shorter extensions create uncertainty that undermines the program’s benefits. Two Senate bills, S.4110 and 2.2952, have been introduced that would extend the program through 2041 and 2045, respectively.
- Provide universal coverage so that all products from AGOA members are eligible for duty-free status. In 2023, fewer than one-third of U.S. imports from AGOA nations utilized the program.
- To determine AGOA product eligibility, allow countries to cumulate the value of content from the United States, countries that have free trade agreements with the United States, and countries that are eligible for trade preference programs. For example, based on a 35 percent AGOA rule of origin, an import from Kenya would qualify with 35 percent Kenyan content, but also with 35 percent of combined content originating from Kenya, the United States, our free trade partners, or other AGOA or Generalized System of Preferences countries. This would strengthen supply chains and increase the benefit of signing a free trade agreement with the United States.
These and other suggestions should not detract from the primary goal of providing for a long-term extension of AGOA. Ideally, reauthorizing AGOA would spark progress toward mutually beneficial zero-tariff trade agreements with Kenya and other African countries. NTU encourages Congress to reauthorize AGOA.