“I need to advise you not to be over-concerned by the recent actions by the American Government in discouraging their companies from investing in Uganda and on removing Uganda from the AGOA list” – President Yoweri Kaguta Museveni (05.11.2023).
The African Growth and Opportunity Act (AGOA) is an opportunity for the businesses in Uganda to export products or produce, raw material and others to the United States of America on unique terms. Which has been beneficial for other nations. While the National Resistance Movement (NRM) haven’t been able to develop or follow the terms or conditions for such is another matter. As we know the Kenyans are much more thrifty and has set the standard on these matters. That’s maybe why the President is so arrogant and brushes it off.
A key aspect in the letter from U.S. President Joe Biden on the 30th October was this:
“Despite intensive engagement between the United States and the Central African Republic, Gabon, Niger, and Uganda, these countries have failed to address United States concerns about their non-compliance with the AGOA eligibility criteria.” (Biden, 30.10.2023).
The key term here is “non-compliance” and meaning the Ugandan authorities or government itself is breaching the agreement, which is reason for the opportunity to trade within the framework of AGOA. The Ugandan government might disagree with these conditions or terms, but has to comply to be eligible in the first place. That’s the rule that AGOA sets on anyone and they just have to comply. It is as simple as that.
However, Museveni wants it his way…
“Uganda, under the NRM, is and will succeed, regardless of what some of the external actors and internal detractors do. The further good news, is that not all the Western Countries’ actors are of the same arrogant attitude. Many, actually, either agree with us or believe in the correct principles of live and let live. Even in the colonial times, some Western actors supported our anti-colonial struggle. People like Fenner Brockway, Dingle Foot, Olof Palme, etc., supported us” (Museveni, 05.11.2023).
The U.S. legislation of AGOA is a “new” one in some senses, as it only dates back to 2020. It isn’t a colonial relic or a mechanism from the days of slavery. No, it is a modern one, which has one important aspect.
That is explained like this: “The legislation significantly enhances market access to the US for qualifying Sub-Saharan African (SSA) countries. It does that by allocating a special program indicator (‘D’) to approximately 6,800 tariff lines in the US tariff schedule, which allows US importers to clear such goods – sourced from eligible African countries – duty-free under AGOA” (AGOA – About AGOA).
This explanation is stating one fact, which the businesses of Uganda misses out on. They will loose out on favourable tariffs when exporting to the U.S. Market. Meaning the prices of exporting will go up and the viability to enter the market will be much tougher. On the short-term its only the ones supplying and exporting the U.S. under these terms that is hit today. However, in the long run… the ones who wants or have a chance. They will either be to expensive or to much red-tape to get there. Which isn’t better for development or trading in general.
The AGOA and principals of AGOA could be beneficial for Ugandan businesses. Especially, if export businesses and the ones who has value-added enterprises wanted to significantly enter a capitalistic market and ensure possibility of selling on a large scale. Because, that what you do, if you get a shot.
We see that the President doesn’t value this and for his often speaking of value-addition. This here is the opposite and it isn’t clever. Neither using arrogance or colonialism. The AGOA is about an opening to a market and ability to trade without to many hurdles. The AGOA has stipulations, but if you adhere to them. You get prospects of entering a market, which gives you possible profits. Therefore, you are foolish to let this one slide. However, that is what the President does and he doesn’t mind.
Actually, the President isn’t concerned… and that is telling. Peace.