As the 2025 expiry date of the African Growth and Opportunity Act (AGOA) nears, United States policymakers are considering if and how it should be extended, over concerns about uneven utilisation or poor reciprocity from African countries.
Indeed, exports from Nigeria to the United States have fallen over the last few years, a trend an expert has attributed to poor research and branding.
Speaking with The Guardian in Washington D.C at the ongoing Foreign Press Centre (FPC) tour for select African journalists yesterday, Director of the Institute for African Studies at George Washington University, Prof. Jennifer Cooke, also explained the reasons U.S. authorities are demanding a better trade treatment from Africa, including Nigeria.
Addressing concerns over the renewal of the African Growth and Opportunity Act (AGOA) when it expires, Cooke said there has been a lot of debate on why it should be discontinued.
She stated that some stakeholders have argued that the U.S. should demand reciprocal treatment as AGOA seems to be currently a one-way preference system under which goods come into the U.S. without tariffs whereas US exporters pay tariffs, which she said are often more than what Chinese and European importers are asked to pay.
She said this has led to dissatisfaction from policymakers who wonder why the biggest economy is treated badly after giving free access to goods coming from Nigeria and other African countries.
“As a place becomes more strategic, the partnership becomes more far reaching,” she noted.
Cooke said the first question every exporter must ask is if there is a demand for their product or service in the U.S.
“Many exporters just assume anything would sell and try to bring it in but you have to make your findings well before doing this. Also, the packaging or branding is very important. Most times, manufacturers that want to export don’t manufacture with us in mind but simply sell in ethnic supermarkets. Packaging is very important to the U.S. consumer. Manufacturers must ask themselves who they are exporting to and how to appeal to the American consumers who might not have the same taste as them,” she said.
She added: “Reverse trade missions are important to introduce importers and exporters to one another as well as new markets, but they must benefit both sides. Making the connection to the consumer on the other side of your export is very important in facilitating trade opportunities.”
She added that Nigerians in the diaspora have a role to play in helping local exporters connect with the American market.
On how to get more American investors to seize the opportunities that abound in the Nigerian market, she said there is a lot of potential.
“China has policies in place where they push entrepreneurs to set up companies in strategic places they have interest in. We don’t do that to our businesses, we can only encourage them. Perception is something we must work on too because a lot of businesses have the perception of risk for Nigeria, which is way bigger than the actual risk itself. This goes back to the lack of understanding about Africa.
“If something goes wrong in Zimbabwe, for example, people here say the whole continent is going downhill. There is a clear lack of nuanced understanding and a re-education process must be carried out to change a lot of these perceptions and this is a huge opportunity to close the perception gap,” she added.
Also speaking, Senior Advisor, Power Africa, Michael Jordan, said the group’s partnership with the Africa Development Bank (AfDB) and World Bank to supply energy to select African countries including Nigeria, will grow from 14 gigawatts to 30 by the year 2030.
Jordan said the institution is also working alongside other European countries to support African governments to implement their energy agenda.
He regretted that despite best efforts in the last decade, about 600 million people remain without electricity across sub-Saharan Africa. Funded by the USAID, he said their goal is to reduce energy poverty, accelerate energy access and decarbonise current energy systems. “We are addressing challenges in partnership with private companies in Africa. Nigeria is the biggest electricity market in terms of the number of consumers.
“The Nigeria Power Sector Programme which has been in existence in the last three years focuses on both on grid and off grid solutions. Nigeria has the highest number of people without power (mostly because it has more residents) and we know off-grid solutions are the best way to reach more people. We have worked with all the 11 distribution companies (DisCos) in the last few years to reduce energy losses and encourage productivity.”
Jordan said the programme, which is distributed across Sub-Saharan Africa, is actively working across geographic areas to try and achieve results and off-grid solutions like mini-grids, solar home systems and solar for businesses.
“Power can raise the standard of living in many rural areas very effectively and exponentially as well as accelerate energy access,” he said.