Politics
US Senate extends Agoa trade agreement through 2028
After a one-year extension in February, the US Senate voted to renew the Agoa through the end of 2028. However, Washington is imposing conditions, notably preferential access to critical minerals in beneficiary countries. The textile sector benefits most from Agoa. A decisive step. Following the US Senate vote on August 8, the legislative process for extending the African Growth and Opportunity Act (Agoa) is entering its final stretch. American senators voted overwhelmingly in favor of renewing this framework offering preferential terms for exports to the United States through December 31, 2028. The Agoa extension was voted as part of a broader bill on provisional credits and budget extensions, with ninety votes in favor and six against. This vote signals the end of congressional debates on renewing this trade program. Until its expiration in September 2025, the House of Representatives and Senate had been unable to agree on renewal terms. In January, the House had voted overwhelmingly for extension through December 31, 2028. However, Senate debates were more contentious. Seeking consensus, Congress opted for a provisional solution by reactivating Agoa through December 31, 2026. Finally, the Senate voted for extension through December 31, 2028. Nevertheless, senators made some adjustments to the text—"minor amendments," according to international press reports. These amendments should be incorporated without difficulty by the House of Representatives in a new vote expected in September, after Congress's summer recess. Barring surprises, the legislative process on Agoa extension should conclude quickly. The final step will be its signature by US President Donald Trump, who will simultaneously issue an executive order for its implementation. Agoa is the flagship trade mechanism in US relations with sub-Saharan African states, particularly since the early 2000s. For Madagascar, this extension is a welcome relief. The framework supports a significant portion of Malagasy exports, particularly in the textile sector, the country's main provider of industrial jobs. The vanilla and other spices sectors also benefit. Critical minerals access. The US Senate vote can be seen as a reassuring signal. It comes especially just weeks after an alert from the Groupement des entreprises franches et partenaires (GEFP), which had called on the State and International Monetary Fund (IMF) regarding growing sector difficulties due to fiscal pressure. However, Agoa extension is not a blank check. American authorities want to strengthen reciprocity requirements, following President Trump's "America First" policy. "21st-century Agoa must demand more from our trading partners and offer better market access for American farmers and ranchers (...) by ensuring more reciprocal trade with our sub-Saharan African partners, to strengthen US global competitiveness," said Jamieson Greer, US Trade Representative, according to international media reports. Furthermore, on recommendation of the Ways and Means Committee, new provisions "to prioritize and streamline access and processing of critical minerals in Agoa beneficiary countries" were reportedly introduced in the Senate-voted text. The Committee highlighted American strategic interests and emphasized "the risk of leaving a void that competitors could exploit"—language indicating Washington intends to emphasize its strategic interests. These new provisions on preferential critical minerals access could directly concern Madagascar. Immediately, this raises the Vara Mada mining project, formerly Base Toliara. It is the largest private American investment in the country. Its launch faces persistent opposition from local populations and certain political figures, including the National Assembly president and a presidential adviser. In June, Nick Checker, Deputy Assistant Secretary of State for African Affairs, and Christopher Kulukundis, Senior Adviser for Africa, visited Madagascar to meet the head of state, prime minister, and National Assembly president. According to the latter, the two men "were sent by the president."
Source: L'Express de Madagascar