Madagascar: Madagascar wants to strengthen its position.

A delegation from the American congress is undertaking a roadshow to assess the impact of Agoa in beneficiary countries. During a meeting on Thursday in Iavoloha, the state pleaded for the strengthening of Madagascar’s position in this program.

Madagascar can do more. This is the message that the state wanted to convey during a meeting with members of the United States Congress on Thursday at the State Palace in Iavoloha. A message regarding its performance in trade exchanges under the African Growth and Opportunity Act (Agoa).

Eight members of the Ways and Means Committee of the US Congress met with Andry Rajoelina, President of the Republic, and four ministers on Thursday. Seizing the opportunity, the Malagasy side emphasized the impact of Agoa on the economy of the island. It also highlighted Madagascar’s performance in recent years. And emphasized its desire to strengthen its position in trade partnership with the United States and expand the range of exchanges.

Since 2021, Madagascar has been in the top 5 exporting countries to the United States, out of the thirty-nine Agoa beneficiaries. In 2023, the value of Malagasy exports under Agoa in Africa is estimated at over $200 million. This performance is mainly due to the textile sector. In 2022, the island surpassed Ethiopia, becoming the second largest supplier of clothing to the United States through Agoa.

In Iavoloha on Thursday, the Malagasy side thus emphasized its desire to do more and diversify the range of products to be exported under Agoa, “in order to fully benefit from it.” Enacted in 2000, the framework law gives beneficiary countries in sub-Saharan Africa access to the American market with duty-free and tax-free benefits. More than 1,800 products are covered. For Madagascar, there is still a wide opportunity to diversify its export products to the United States.

Since its inception, Agoa has been subject to periodic evaluation for a decade-long renewal. The current program, which is currently underway, expires in September 2024. The visit of members of the Ways and Means Committee to the island is part of an assessment tour of five beneficiary countries. Before Madagascar, they were in Mauritius.

Vital

The purpose of this tour is to assess, on site, the impacts of Agoa and the progress made by beneficiary countries. This is in preparation for upcoming debates in the US Congress on the renewal of the program. It is also an opportunity to discuss potential improvements. Madagascar therefore wants to seize this opportunity to expand its products to be exported under Agoa, while emphasizing the importance of its continuation in the program.

The Malagasy side has also suggested that the renewal of Agoa be for “more than fifteen years.” The idea is to have certainty about the stability and sustainability of trade relations between the United States and Madagascar, especially for businesses and workers covered by the program. “The visit of this strong delegation from the Ways and Means Committee of the US Congress confirms the US interest in strengthening cooperation between our two countries,” said President Rajoelina.

The President added that Madagascar’s revalidation in Agoa “perfectly aligns” with the objectives of the State General Policy (PGE). Also, Edgard Razafindravahy, Minister of Industrialization and Trade, presented during Thursday’s meeting the results and impacts, as well as the prospects of the island, in relation to Agoa. At the beginning of his speech, he emphasized “the vital importance of the renewal of Agoa for Madagascar.”

According to Minister Razafindravahy, “this partnership has greatly contributed to the economic and social development of our country. Since 2001, Agoa has served as a solid foundation for the economic development of Madagascar, offering unprecedented access to one of the world’s largest markets.”

The President of the Republic also emphasized the second pillar of the PGE, which is economic transformation through industrialization.

“The development of exports [especially through Agoa] would therefore be an important milestone in achieving Madagascar’s industrialization goal,” said Andry Rajoelina. The island also aims to leverage its performance in Agoa to attract investors, especially from the United States. Various reforms for investment security, including amendments to the investment law, were highlighted. Likewise, for the skills, youth, dexterity, and competitiveness of the workforce.

On their part, the US side sought to reassure. “President Smith’s visit [who heads the Ways and Means Committee] confirms the bipartisan commitment of the US Congress, as well as the administration, to authorize Agoa (…),” said Claire Pierangelo, US Ambassador, according to a statement from the US diplomatic representation.

Garry Fabrice Ranaivoson