The US administration plans to reconsider the eligibility of Rwanda and South Africa for the African Growth and Opportunity Act (AGOA) preferential trade program, effective January 1, 2027. This decision, reported by Reuters, is based on an evaluation of the countries' adherence to the program's criteria. The US has expressed concerns about certain trade practices and policies in both countries, which it deems incompatible with AGOA requirements.
Rwanda faces criticism not only for trade practices but also for concerns related to the rule of law, political pluralism, human rights, and workers' rights. In 2018, the US suspended Rwanda's preferential tariff benefits for exports of clothing due to a dispute over tariffs imposed on used clothing and shoes imported from the US. A potential broader exclusion would further strain economic relations between Washington and Kigali.
South Africa, the continent's largest industrial economy, is also under scrutiny from the US. Washington has raised concerns about trade and investment obstacles, corruption, and certain national security and foreign policy considerations. In 2025, South Africa exported approximately $1.7 billion worth of goods to the US under AGOA. A potential exclusion could impact several economic sectors, including the automotive industry, equipment, and manufactured products.
The African Growth and Opportunity Act, which came into effect in 2000, is a significant instrument for US trade cooperation with sub-Saharan Africa. The program allows eligible African countries to export over 1,800 product categories to the US market duty-free. Beyond trade, AGOA promotes economic development, investment, and job creation in several African economies.
The potential withdrawal of Rwanda and South Africa from AGOA may revive questions about the future of US trade relations with African partners, particularly amid economic competition and shifting international alliances. For other beneficiary countries, this situation serves as a reminder that maintaining AGOA benefits is conditional on meeting US economic, institutional, and political requirements.
According to sources, the US administration's decision is driven by a thorough evaluation of the countries' eligibility for AGOA. The program's requirements include a commitment to reducing trade barriers, promoting economic development, and protecting workers' rights. The US has previously expressed concerns about Rwanda's and South Africa's trade practices and policies.
The South African government has indicated that it is prepared for an unfavorable decision and will prioritize continued dialogue with Washington and seek new trade partners. The potential exclusion of Rwanda and South Africa from AGOA may have significant implications for their economies and trade relationships with the US.
Key points
- The US may withdraw Rwanda and South Africa from the African Growth and Opportunity Act by January 2027 due to concerns about their trade practices and policies.
