Monday, October 15, 2012

African Textile Exports, China and AGOA

The Eurasia Review ran a brief but fascinating analysis on 15 October 2012 of the impact on African textile exports under the U.S. Africa Growth and Opportunity Act (AGOA). The authors--Lorenzo Rotunno, Pierre-Louis Vezina and Zheng Wang--describe how U.S. trade policy designed to encourage duty free imports from Africa inadvertently turned Africa into a temporary trade corridor for China.

AGOA provided an opportunity for exporters from China and Taiwan to transship their textile products via industrial plants in Africa, thus avoiding U.S. quotas by benefiting from AGOA preferences. The subsequent end of quotas on Chinese exports rendered the transshipment unnecessary, leading to the departure of many of the textile factories in Africa and the fall of textile imports from Africa under AGOA.

Click here to read the analysis.

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