The Pan African Chamber of Commerce and Industry (PACCI) weighs up the implications for African manufacturers and workers of the one-year extension of the African Growth and Opportunity Act (AGOA).
The United States has approved a one-year extension of the African Growth and Opportunity Act (AGOA), restoring duty-free access for eligible African countries until 31 December 2026. While this decision provides short-term relief to African exporters, it falls short of expectations for a longer, more predictable renewal and perpetuates uncertainty for manufacturers, investors and workers across the continent.
This Policy Pointer outlines what the extension means in practice, why African businesses are disappointed, and why the situation as it stands at the moment calls for stronger continental coordination and diversification.
Background
AGOA has, for over 25 years, provided eligible African countries with tariff-free access to the US market, supporting employment and industrial growth, particularly in apparel, textiles, agro-processing and light manufacturing.
The programme was allowed to lapse briefly in September 2025 before being reinstated through a one-year extension signed by US President Donald Trump. While an earlier proposal for a three-year extension passed the US House of Representatives, the final legislation approved by the Senate reduced the renewal period to one year.
At present, 32 African countries remain eligible under AGOA, subject to ongoing political and governance assessments.
Why African businesses are disappointed
From the perspective of African manufacturers and workers, the one-year extension is inadequate for several reasons:
Manufacturing requires long-term planning: Factories cannot make investment decisions, upgrade machinery, or train workers on a 12-month policy horizon.
Employment stability is undermined: Workers’ jobs depend on predictable orders and sustained market access, which a one-year extension does not guarantee.
Investor confidence is weakened: Short-term trade preferences discourage new capital inflows and reinforce perceptions of political risk.
Future access remains uncertain: US officials have indicated that AGOA will be reworked to deliver greater benefits to US firms, potentially introducing stricter conditions for African exporters.
The result is continuity without confidence.
Global context: a changing trade landscape
The uncertainty surrounding AGOA contrasts sharply with recent actions by other global partners. Notably, China has expanded duty-free and quota-free access for African exports, particularly for least-developed countries, offering longer-term predictability. For African businesses, this divergence matters. Market access decisions increasingly hinge on stability, clarity and duration, not only tariff levels.
Strategic implications for Africa
The AGOA extension reinforces several strategic realities:
- Trade preferences granted externally remain vulnerable to foreign political cycles.
- Fragmented national approaches weaken Africa’s negotiating position.
- Over-reliance on a single external market exposes manufacturers and workers to sudden shocks.
The decision to extend for one year highlights the urgency of strengthening intra-African trade, accelerating implementation of the African Continental Free Trade Area (AfCFTA) and developing regional value chains that reduce dependence on uncertain external arrangements.
What this means for your business
- Short-term continuity, not certainty: Existing AGOA-linked exports can proceed, but planning beyond 2026 carries elevated risk.
- Cautious investment climate: Capital investments tied primarily to the US market should be reassessed unless supported by market diversification.
- Fragile employment outlook: Hiring and workforce expansion may remain constrained due to uncertainty over future orders.
- Urgent need to diversify markets: Firms are encouraged to explore AfCFTA opportunities and alternative export destinations offering longer-term predictability.
- Collective advocacy is critical: Member businesses should engage through chambers and industry associations to support a unified African trade strategy.
AGOA remains a valuable instrument – but it is no substitute for Africa-led, long-term trade and industrial policy.
PACCI position
PACCI welcomes the temporary extension of AGOA but stresses that Africa’s industrial future cannot be built on rolling one-year renewals. Sustainable manufacturing growth requires predictable market access, coordinated continental action and strong internal markets.
PACCI will continue to:
- Advocate for longer-term, predictable trade arrangements
- Support AfCFTA implementation and
- Promote a unified African voice in global trade negotiations.
For further information or to share member feedback, please contact the PACCI Secretariat.
