The Groupement des Entreprises Franches et Partenaires (GEFP) has welcomed the renewal of the African Growth and Opportunity Act (AGOA) until 2028. However, the organization believes that a two-year extension is insufficient and is advocating for a 10-year extension. This, they argue, will provide stability and encourage investment in the country's industrial sector. The GEFP's call for an extended AGOA benefits period is crucial for Madagascar's economy.
The AGOA provides preferential tariff treatment for exports from eligible African countries, including Madagascar, to the United States. The GEFP wants the extension to be governed by the Third Country Fabric (TCF) rule, which allows for the export of clothing made from fabric sourced from third countries. This, they believe, is essential for sustaining investments and preserving jobs linked to Malagasy exports to the US. The GEFP has expressed its concerns and expectations to representatives of the US Embassy's economic and commercial service in Madagascar.
On October 13, the GEFP hosted a visit to its member companies, Mazava and Labo OI, to showcase Madagascar's industrial capabilities and the impact of trade with the US market. The visit demonstrated the country's industrial capacity and expertise in the textile and apparel sector. The GEFP is keen to highlight the importance of a stable business environment, reliable electricity and water supply, and efficient logistics in enhancing Madagascar's competitiveness.
The textile and apparel sector, in particular, requires significant investment, equipment acquisition, and employee training, which can take considerable time. A longer AGOA benefits period would provide greater visibility for exporting companies, enabling them to plan investments and strengthen their position in international markets. This, in turn, would help to attract new investments and create jobs.
Beyond tariff preferences, Madagascar's competitiveness depends on a stable business climate, reliable infrastructure, and controlled logistics costs. The GEFP emphasizes the importance of addressing these challenges to support the growth of the industrial sector. The organization reaffirms its commitment to upholding social and environmental standards, as well as workplace health and safety.
For Madagascar's industrial sector, the stakes are high, with the goal of preserving existing jobs and attracting new investments. The GEFP's advocacy for an extended AGOA benefits period is part of its efforts to promote the country's economic development. The organization's engagement with the US Embassy and other stakeholders reflects its dedication to advancing the interests of Madagascar's industrial sector.
The GEFP's efforts to promote Madagascar's industrial sector are ongoing, with a focus on enhancing the country's competitiveness and attracting investment. The organization's work with the US Embassy and other partners aims to secure a stable and supportive business environment for Malagasy companies. This will help to drive economic growth and create opportunities for the country's people.
Key points
- The GEFP is advocating for a 10-year extension of the AGOA benefits period to provide stability and encourage investment in Madagascar's industrial sector.
