Does the African Growth and Opportunity Act (AGOA) impact EU-15 imports from Africa?

Mahabir, A. ORCID: 0000-0001-9867-2830, Fan, J. ORCID: 0000-0003-4447-6580 and Mullings, R. ORCID: 0000-0002-5569-9117, 2018. Does the African Growth and Opportunity Act (AGOA) impact EU-15 imports from Africa? In: 25th EBES Conference, FOM University of Applied Sciences, Berlin, Germany, 23-25 May 2018.

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At the heart of the African Growth and Opportunity Act (AGOA) are substantial trade preferences which, coupled with the Generalised System of Preferences (GSP), grant a wide range of goods produced in qualified African countries duty-free access to USA. To be AGOA-eligible, countries are assessed annually on their progress in undertaking appropriate economic, institutional and human rights reforms. Our paper seeks to cover new grounds by exploring whether exports of apparel to US crowds out EU-15’s imports from Africa over the period 2001-2016. Two-stage least squares estimates of our gravity model provide no evidence of trade displacement but, instead, provide support for the hypothesis of complementarity of African exports to the two key markets. Positive impact of bilateral trade between US and Africa on EU-African trade is evident mainly after the phasing out of the Agreement on Textiles and Clothing. We also examine whether the more relaxed special waiver embodied in AGOA’s apparel provision causes Non-Knitted exports to EU-15 to be crowded out. We find that Special Rule beneficiaries' exports to the two markets still complement each other, but for every percentage increase in exports to USA, there is a less than proportionate increase in exports to EU-15, indicating a higher utilisation of the special waiver.

Item Type: Conference contribution
Creators: Mahabir, A., Fan, J. and Mullings, R.
Date: May 2018
Divisions: Schools > Nottingham Business School
Record created by: Jonathan Gallacher
Date Added: 18 Dec 2018 08:11
Last Modified: 18 Dec 2018 08:11

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