African cotton and textile industry trade association denies contravening Agoa rules, defend import barriers
Tanzania and Uganda have insisted that the ban on used clothes as agreed by the regional heads of states last year — stands, regardless of the outcome of the out-of-cycle review by United States trade bodies on access to the preferential trade programme, the Africa Growth and Opportunity Act (Agoa).
Dar es Salaam and Kampala have indicated that they will not bow to pressure from any quarter at the expense of their local textile sectors.
Recently, Tanzanian Prime Minister Kassim Majaliwa said that the country would do away with used clothes as it pushes for new clothes made from textile mills in the country.
“We are doing away with secondhand clothes imports because we are now comfortable that the various types of garments can be made in the country at affordable prices.
"We will also use this to offer cotton farmers a reliable market. This is the way to go,” Mr Majaliwa said, reinforcing the country’s position on the debate.
His assertion came after Tanzania, Rwanda and Uganda made submissions against their potential loss of Agoa benefits during an out-of-cycle review meeting called by the US Trade Representative’s office.
Kampala has also indicated that it will not back down on implementation of tariff increases in order to protect its own industries against these imports.
Matia Kasaija, Uganda’s Minister for Finance, Planning and Economic Development, said that they will not revise the increased tariffs as they were meant to protect the Ugandan textile sector.
“We are not going to bow to pressure from these trade groups,” Kasaija said.
“The taxes stand as they are. We will also not back away from the planned phasing out of used clothes as agreed within the EAC Secretariat. We have cotton and textile firms that are up to the task. We cannot continue like this as it is retrogressive.
"The businesspeople fighting our regulations should instead focus on importing new clothes into our country. That we don’t have a problem with,” he added.
Belinda Edmonds, executive director of African Cotton and Textile Industries Federation, a trade association with membership from the cotton, textile and apparel industries in 24 countries in Africa.
She said that the implementation of duties and barriers to the importation of used clothing by Rwanda, Tanzania and Uganda does not contravene the provisions of Agoa Section 3703(1)(C), which touches on the elimination of barriers to US trade and investment.
“The vast majority of used clothing imports to these countries are not manufactured within the USA, nor do they undergo sufficient processing within the USA that would, under the usual trade conventions, confer ‘Origin status.’
"A significant proportion of the used clothing imports to these countries do not meet the ‘signs of appreciable wear’ criteria. Rather, a significant proportion of such imports are in fact overruns, unsold overstocked inventory,” Ms Edmonds said.
In 2016, US Agoa imports from Rwanda, Tanzania and Uganda totalled $43 million, up from $33 million in 2015, according to the US Trade Representative.
On the other hand, US exports to Rwanda, Tanzania, and Uganda were $281 million in 2016, up from $257 million the year before.
Last week, the US Trade Representative held a public hearing to review Rwanda, Tanzania and Uganda’s eligibility to receive the benefits under the Agoa, whose decision is expected later this month.
If the petition is approved, President Donald Trump will be expected to act on the review recommendations and either withdraw, suspend, or limit the application of duty-free treatment on articles from the three countries.
“The Trump administration intends to rigorously enforce Agoa eligibility requirements. Countries benefiting from trade preferences granted by the Agoa platform must continue complying with eligibility requirements established in US law,” US Commerce Secretary Wilbur Ross said last month at a US-Africa business summit.