US suspends Rwanda’s duty-free apparel status
- Last week, US President Donald Trump determined the eligibility of Rwanda, Tanzania, and Uganda for trade preference benefits under AGOA.
- He found Rwanda to not be making “sufficient progress toward the elimination of barriers to US trade and investment”, and therefore was out of compliance with eligibility requirements.
- Consequently, he has suspended the duty-free status of Rwanda’s apparel.
The Administration initiated an out-of-cycle review of Rwanda, Tanzania, and Uganda’s AGOA eligibility last year
The US has suspended the duty-free status of Rwanda’s apparel after determining the African nation had unfairly blocked US exports of used clothing.
The move, announced in a statement from the Office of the United States Trade Representative last week, is a result of an out-of-cycle review of Rwanda, Tanzania, and Uganda’s eligibility under the African Growth and Opportunity Act (AGOA) regarding their decisions to phase in a ban on imports of used clothing and footwear. The review followed a petition filed by the US-based Secondary Materials and Recycled Textiles Association (SMART) against the countries’ decision to phase out imports of used clothing in March of last year.
Each year the President reviews and designates sub-Saharan African economies as AGOA beneficiaries – including preferential treatment for imports of certain textile and apparel articles – as long as specified eligibility requirements are met. Not all AGOA members are eligible for duty-free, quota-free apparel imports provision.
The requirements for AGOA eligibility include that the country has established or is making substantial progress towards establishing, among other things, a market-based economy, the rule of law, political pluralism, the right to due process, the elimination of barriers to US trade and investment, economic policies to reduce poverty, a system to combat corruption and bribery, and the protection of internationally recognised worker rights.
Based on the results of the review, Rwanda was found to not be making “sufficient progress toward the elimination of barriers to US trade and investment”, and therefore was out of compliance with the eligibility requirements of AGOA.
Consequently, President Donald Trump notified Congress and the Government of Rwanda of his intent to suspend duty-free treatment for all AGOA-eligible apparel products from Rwanda within 60 days.
The Office of the US Trade Representative (USTR) said Trump opted for suspension rather than termination of the preferential treatment under AGOA since it “would allow for continued engagement with the aim of restoring market access and thereby bringing Rwanda into compliance with the AGOA eligibility requirements”.
The President spared Tanzania and Uganda similar fates after they eliminated prohibitive tariff rates on imports of used clothing and footwear and committed not to phase in a ban of the products. But the Administration said it will continue to monitor whether the two countries implement the commitments and demonstrate compliance with all of AGOA’s eligibility requirements.
“The President’s determinations underscore his commitment to enforcing our trade laws and ensuring fairness in our trade relationships,” said Deputy US Trade Representative C.J. Mahoney. “I commend Tanzania and Uganda for taking corrective steps to address the United States’ concerns. We have and will continue to work with Rwanda to resolve this situation.”