Home / Knowledge / News / Textiles / Collier warns against expanding AGOA to Non-African LDCs

Collier warns against expanding AGOA to Non-African LDCs

05
May '10
Eminent development economist Dr. Paul Collier, Director of the Center for the Study of African Economies at Oxford University, warned last week that expanding the trade preferences currently reserved for eligible African nations by the African Growth and Opportunity Act (AGOA) to all Least Developed Countries (LDCs) would be disastrous for African economic development.

Speaking at the Leaders Forum on the 10-Year Anniversary of AGOA in Washington, DC, Dr. Collier described how proposed legislation in the US Congress to extend duty-free and quota-free access to the US market to big apparel exporting LDCs like Bangladesh and Cambodia would destroy Africa's much smaller apparel manufacturing sector.

Trade preferences are the "pump priming mechanisms" for the creation of the manufacturing clusters of mutually-supporting industries necessary for building a labor-intensive and globally-competitive sector, he said, adding that apparel sectors in countries like Bangladesh, Cambodia and China were already benefiting from such clustering and had achieved critical economies of scale, but that the African apparel sector had not yet reached that threshold.

"We know where trade preferences should go, and where they should be kept out because if we let in one huge manufacturer, it would cut out all the little manufacturers," Dr. Collier said. "These large manufacturers must be kept out because they are not entrants into manufacturing. Bangladesh doesn't need privileged access. There are many ways to help Bangladesh because it is still poor, but trade preferences [to benefit its apparel sector] is not the way."

In 2008, the value of apparel exports to the US from all 48 sub-Saharan African (SSA) countries combined was a little over $1 billion. Bangladesh alone sold $3.5 billion worth of apparel to the US, and Cambodia $2 billion. With the onset of the global economic downturn, African apparel exports to the US dropped by over 10 percent in 2008, while imports from Bangladesh grew more than 11 percent.

"One reason [trade preference reform] is on the political agenda is because there will be big money for companies importing from Bangladesh," Dr. Collier said. US retailers stand to gain about a $1 billion in recovered duties if the US Congress enacts trade preference reform in its present form.

He added that rather than diluting AGOA, now was the time to scale it up. "There is a real opportunity for AGOA to go global. If we had a Super AGOA that included Europe and Japan, it would make life so much easier for Africa," he said.

Dr. Collier also noted that climate change was already adversely affecting African agriculture and it was critical for Africa to break into light manufacturing where employment can be scaled up rapidly.

The Leaders Forum was co-hosted by the AGOA Action Committee and a coalition of organizations that support AGOA. It was organized by The Whitaker Group, a premier US-based consultancy that facilitates trade and investment in Africa.

Director of the Center for the Study of African Economies at Oxford University


Must ReadView All

Pic: Shutterstock

Apparel/Garments | On 9th Apr 2020

Bangla PM unveils fresh stimulus packages worth Tk67750 cr

Prime Minister Sheikh Hasina recently unveiled a set of stimulus...

Pic: Shutterstock

Apparel/Garments | On 9th Apr 2020

Indonesian firms to produce 17 mn PPE units per month

As the Indonesian textile and garment industry has assured the...

Pic: Shutterstock

Textiles | On 9th Apr 2020

CAI retains 2019-20 crop estimate at 354.5 lakh bales

The Cotton Association of India (CAI) has in its March estimate...

Interviews View All

Milind Khandwe, Hindoostan Innovation Centre

Milind Khandwe
Hindoostan Innovation Centre

‘Modern technical textile is an indispensable tool for science and...

Krishnanand Tripathi, Textrade International Ltd

Krishnanand Tripathi
Textrade International Ltd

We believe in vocational education for entry-level employees, offering...

Dharmendra Shah, Ozone PB Spintex Limited

Dharmendra Shah
Ozone PB Spintex Limited

‘We have made huge investments to ensure quality yarn production.’

Siddhachakra Weaving (Badiya Fashion),

Siddhachakra Weaving (Badiya Fashion)

Ahmedabad-based Siddhachakra Weaving Pvt Ltd was established in 2011 under ...

Harssh Chheda,

Harssh Chheda

Mumbai-based Corporate Collars provides bespoke tailoring services for...

Suresh P Bagrecha,

Suresh P Bagrecha

Komal Texfab, founded in 1981, is into manufacturing of knitted fabrics,...

Robin Grankvist, OrganoClick AB

Robin Grankvist
OrganoClick AB

Robin Grankvist talks about PFCs, additives and various chemicals used in...

Ian Russell, Pireta

Ian Russell
Pireta

UK-based Pireta has developed a unique free-form process to add durable,...

Andreas Lukas, Andritz Nonwoven

Andreas Lukas
Andritz Nonwoven

With forces in engineering and process development, Andritz Nonwoven...

Anjali Bhaskar, Samatvam

Anjali Bhaskar
Samatvam

Anjali Bhaskar has an experience of 12 years in the fashion industry. She...

Sarah Denise Cordery, Sarah Denise Studio

Sarah Denise Cordery
Sarah Denise Studio

Manchester, England-based Sarah Denise Studio provides relevant fashion...

Sweta Agarwal, A Humming Way

Sweta Agarwal
A Humming Way

A Humming Way (AHW) is inspired by the old-world regalia of Rajasthan...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


April 2020

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search