AGOA Renewal: Geopolitical Manoeuvring and Uneven Benefits Across Africa

  • On February 3, 2026, the United States (U.S.) President Donald Trump signed a law extending the African Growth and Opportunity Act (AGOA)1 until December 31, 2026. While the U.S. House of Representatives passed legislation in January to extend AGOA for three years, the Senate then reduced this to a one-year extension (which the House concurred with).
  • The extension provides only short-term certainty for African exporters and U.S. importers, falling short of the long-term renewal that advocates previously sought (10 years or more) to justify major capital investments in the manufacturing and agriculture sectors. The abbreviated timeline fuels ongoing vulnerability for businesses planning multi-year supply chain commitments.
  • Additionally, an AGOA extension restores some duty‑free preferences for eligible exports, but its practical value is constrained because it does not override the Trump administration’s current unilateral tariff architecture. This includes the universal reciprocal tariffs and the expanding sector-specific Section 232 tariffs on certain metals, autos, and timber products. Even as AGOA preferences return, goods entering the US will face added levies, meaning the duty‑free promise of AGOA is somewhat eroded unless the Section 232 and reciprocal duties are removed.
  • That said, the short duration also implies that future AGOA renewals could be used to pressure countries to align more closely with U.S. foreign policy by using eligibility reviews as a tool to discourage deepening economic and military ties with China, Russia, and Iran. However, countries in the region will continue to push back against this dichotomy, with efforts to increase relations with alternative trading and finance partners such as the Middle East, India and Turkiye.
  • Although AGOA was extended without changes to the current list of eligible countries, likely to expedite the process, BMI anticipates revisions ahead. Notably, South Africa is expected to be excluded soon (despite the country historically being AGOA’s largest beneficiary), given worsening U.S.-South Africa relations, further hampered by developments in January, including Iran’s involvement in naval drills hosted by South Africa and Pretoria’s decision to expel Israel’s envoy to the country.
  • Given the Trump administration’s more transactional approach to Sub-Saharan Africa, countries with significant critical mineral resources, like Gabon and Zimbabwe, may be added to AGOA. Ethiopia could also be reconsidered for inclusion due to its strategic location and closer ties with Israel and the UAE, as well as its untapped mineral potential. Meanwhile, Uganda’s cooperation with the U.S. on migration, specifically by accepting third-country deportees, might also favour its readmittance.

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1AGOA provides eligible sub-Saharan African countries with duty-free access to the U.S. market for over 1,800 products, in addition to the more than 5,000 products that are eligible for duty-free access under the Generalised System of Preferences program.

(Source: BMI, A Fitch Solutions Company)