By: Nana Karikari, Senior Global Affairs Correspondent
Article Summary (Key Points)
- Trade Crisis: AGOA’s lapse (Sept 2025) triggered a Tariff Shock, hitting African exporters with steep MFN duties (e.g., Kenyan textiles facing 43% tariffs). 1.3 million jobs are threatened.
- US Action: The U.S. House has advanced the bipartisan AGOA Extension Act (H.R. 6500), which includes a retroactive refund provision for tariffs paid since the lapse.
- Geopolitics: Renewal is complicated by the high-stakes debate over South Africa’s eligibility. The U.S. Trade Representative is considering removal, despite South Africa’s critical supply of PGMs (Platinum Group Metals) and auto parts.
- Ghanaian View: President John Mahama called the agreement “technically dead,” while the private sector (IEAG) demands a concrete “rescue or transition plan” from the government.
- Long-Term Pivot: The instability validates the urgent need to transition towards the AfCFTA as the primary, resilient continental trade solution.
The United States has moved to revive the African Growth and Opportunity Act (AGOA) after it expired on September 30, 2025. The House Ways and Means Committee approved a three-year AGOA Extension Act (H.R. 6500) on December 10, 2025. This measure, which passed 37-3, offers African exporters a strong, bipartisan legislative path. This concrete action shifts focus from Congressional inaction to the details of renewal: its duration and the contentious eligibility of South Africa. The committee warned that “An extended lapse in AGOA would create a void that malign actors like China and Russia will seek to fill.”
Tariff Shock and Economic Headwinds
The period since the expiration has forced African exporters to immediately pay Most-Favored-Nation (MFN) tariffs, ending duty-free access. This followed earlier, sweeping reciprocal tariffs imposed by the Trump administration in April 2025, which were already eroding AGOA’s value. For key exports, duties have seen a double-digit increase. Kenyan manufacturers face a devastating blow, with tariffs on synthetic textiles potentially surging from 10% to 43% without renewal. Ghanaian exporters face new tariffs estimated at up to 15% on some goods. Ghana’s utilized AGOA exports (excluding oil) were approximately $86 million in 2022, showing prior vulnerability with a 45% decline in the preceding period.
This crisis threatens an estimated 1.3 million African jobs, particularly affecting women in light manufacturing. Machinist Julia Shigadi in an affected country lamented, “If it is gone, it means my life is gone too.” A union leader in Lesotho warned that without AGOA, workers would be forced to “sell their souls and bodies.” The proposed extension bill is crucial because it includes a retroactive provision, intending to liquidate tariffs incurred after September 30, 2025, which would provide an immediate financial lifeline to affected businesses.
Ghanaian Official Perspective: AGOA “Technically Dead”
The expiry has provoked a sharp reaction from the highest level of Ghanaian politics. President John Mahama declared the trade agreement “technically dead” after the US imposed fresh tariffs on African exports, including a 15% levy on Ghana’s goods. He warned that the Trump administration’s transactional mindset had ruined the agreement’s renewal prospects: “There is no way with this 15% tariff, AGOA is going to be renewed.” This pessimism contrasts sharply with the bipartisan Congressional push for an extension.
Geopolitical Reprieve and South Africa’s Strained Eligibility
The House committee’s move, targeting inclusion in the January 2026 Continuing Resolution, is a victory for the US-Africa trade relationship. However, the largest beneficiary, South Africa, faces a high-stakes challenge. The House bill proposes a three-year extension until December 31, 2028, but the Trump administration signals support for only a one-year renewal. Crucially, US Trade Representative Jamieson Greer told a Senate subcommittee he is “happy to consider” removing South Africa from the program, describing the country as “a unique problem.”
This potential exclusion stems from diplomatic concerns over South Africa’s non-alignment on the Russia-Ukraine conflict and its deep ties with China and BRICS. South Africa accounted for nearly half of all AGOA imports in 2024, valued at $3.76 billion. The automotive sector alone accounts for over 60% of South Africa’s AGOA trade. Exclusion would disproportionately hurt this industry, but it would also threaten US supply chains for Platinum Group Metals (PGMs), which South Africa supplies and are vital for US automotive and defense industries. The South African Trade Ministry has stated it will “continue lobbying for full AGOA inclusion,” highlighting the gravity of the decision for Pretoria.
Critical Minerals and Countering China
AGOA’s lapse jeopardized Washington’s diplomatic strategy to secure critical mineral supply chains in Africa. The continent holds vast reserves of cobalt and platinum group metals, vital for US electric vehicle and defense industries. The geopolitical incentive for US investment was always a pathway to non-Chinese-dominated mineral supply. By allowing the lapse, the US disproportionately penalized high-employment, light manufacturing sectors like textiles, while China has “invested billions of dollars across the continent to secure supply chains,” filling the US-created void.
AfCFTA: The Forced Continental Pivot
The instability and conditionality of AGOA have reinforced the need for an African-led trade solution. As economist Hod Anyigba cautioned, AGOA often resulted in “‘economic enclaves’ benefitting only a few.” This validates the necessary pivot to the African Continental Free Trade Area (AfCFTA). The AfCFTA offers a $3.4 trillion market of 1.4 billion people, representing the crucial, resilient alternative. Ghana, hosting the AfCFTA Secretariat, must champion this transition by aggressively pursuing value
addition. African leaders are urged to “consolidate its unity, speak with one voice, and demand that advanced economies approach the continent as an equal partner.”
Building Continental Resilience: Implementation Status
The AfCFTA’s effectiveness is the best buffer against external shocks. While experts widely agree that its full impact will take five to ten years to materialize, decisive progress is critical.
● Rules of Origin (RoO): RoO has been agreed upon for over 92% of tariff lines, but finalization is still pending for high-value sectors like automotives and textiles/clothing.
● Protocols: Phase II protocols on Investment, Competition Policy, and Intellectual Property Rights have been adopted, requiring full ratification by member states.
● Operational Tools: The Pan-African Payment and Settlement System (PAPSS) is operational in 11 countries, allowing cross-border transactions in local currencies to reduce reliance on foreign exchange.
The Ghanaian private sector, through the IEAG, has warned that “The Government of Ghana has remained silent… This silence is deeply troubling given the stakes.” The association further stressed, “Ghana cannot afford indecision or delay,” demanding a clear “rescue or transition plan.” Member of Parliament Michael Okyere Baafi, a member of the main opposition New Patriotic Party (NPP) who represents New Juaben South in Ghana’s Eastern Region, urged the government to “convene a national conference with exporters” to provide reassurance against “severe shocks.” Decisive political will is urgently required to ensure free movement of goods finally supersedes national protectionism, maximizing the continental market as the primary source of sustained growth.
