AGOA Has Officially Expired: What Comes Next?
Adopted in May 2000, the African Growth and Opportunity Act (AGOA) has long been a cornerstone of U.S.-Africa trade relations. By granting duty-free access to the U.S. market for over 1,800 products, AGOA has significantly boosted African exports and encouraged U.S. investment in the region. By 2024, Africa’s exports to the U.S. under AGOA reported close to $10 billion. However, with AGOA officially expiring on September 30, 2025, stakeholders are left pondering the future of trade relationships, economic reforms, and overall development initiatives across the continent.
This critical juncture aligns with the African Continental Free Trade Area (AfCFTA), an ambitious initiative aimed at bolstering intra-African trade and fostering continental integration. While many African countries prioritize this consolidation, others, like Kenya, are exploring bilateral agreements with the U.S. as a potential path forward (e.g., Kenya). Their experiences may offer vital lessons for navigating the post-AGOA landscape, particularly through the lens of Morocco—Africa’s sole nation with a comprehensive free trade agreement with the United States.
Can Bilateral Free Trade Agreements Stimulate African Exports? Lessons from Morocco
The U.S.-Morocco Free Trade Agreement (USMFTA), ratified in 2004 and effective from 2006, aimed to transform Morocco into a hub for trade and investment, diversify its economy, and create employment opportunities. Covering a wide array of sectors from goods to investment protection, it was hailed as a progressive policy. Yet, nearly twenty years on, results appear mixed. Notably, the balance of trade has shifted unfavorably for Morocco; imports from the U.S. have consistently outpaced exports, leading to a persistent trade deficit (see Figure 1). In fact, in 2024, exports to the U.S. constituted a mere 3.1% of Morocco’s total goods exports, dwarfed by the 65.3% that went to the European Union.
Figure 1. Morocco has experienced a persistent trade deficit with the United States since the USMFTA came into force in 2006 (in millions of current USD)
Under the USMFTA, the composition of Morocco’s exports shifted away from traditionally female-dominated sectors like textiles and apparel toward male-intensive, capital-heavy industries such as phosphatic fertilizers. This structural change has had repercussions on labor dynamics, leading to lower female labor force participation rates. Investments from American firms are typically channeled into capital-intensive areas like renewable energy and infrastructure, compounding the gender disparities in Morocco’s workforce. The OECD has highlighted that in 2021, high-technology exports accounted for just 6% of Morocco’s total exports, showing stagnation compared to their share in 2001.
However, the imbalance extends beyond gender issues. The asymmetry in tariff commitments, where Morocco undertook significantly larger reductions than the U.S., alongside its limited export competitiveness, inhibits its full potential under the agreement. The U.S. has fully utilized its robust industrial base, resulting in a trade surplus that reached $3.4 billion in 2024, a stark increase from $35 million in 2005. Research encapsulated in a paper by Koudjom et al. (2025) reveals that USMFTA has negatively impacted Moroccan exports across several strategic industries, illustrating the limitations imposed by structural and institutional disparities.
The vulnerability of this bilateral agreement escalates with political uncertainties. A potential re-imposition of a general 10% tariff on Moroccan imports by a possible second Donald Trump administration could contradict the provisions outlined in Article 2.31 of the USMFTA, showcasing the inherent instability in such bilateral frameworks.
Five Recommendations for a Post-AGOA Future
The expiration of AGOA inherently shifts the landscape for African trade, compelling a reevaluation of strategies. Morocco’s experience underscores three critical lessons for other African nations aiming to navigate the changing global trade dynamics. First, it’s essential to recognize that unilateral commitments in bilateral trade agreements may lead to unfavorable outcomes, owing to inherent power imbalances and developmental disparities. Second, gaining preferential market access does not inherently translate into increased competitiveness, hinging largely on the existing productive capacity of nations. Lastly, bilateral agreements alone cannot facilitate a structural transformation of economies. Africa now stands at a crucial crossroads, necessitating a strategy that prioritizes regional integration while simultaneously enhancing productive capacities.
Consequently, the pursuit of multiple bilateral agreements with various global partners—whether developed nations like the U.S. and EU or emerging economies such as China and Turkey—carries potential risks, including asymmetric obligations and fragmentation of trade norms. This fragmentation could threaten the coherence fostered by the AfCFTA. In contrast, collective negotiations could empower Africa to leverage its growing economic influence, ensuring equitable conditions while aligning external commitments with its intra-African trade priorities.
Importantly, it’s evident that intra-African trade potential remains largely untapped. Unlike Morocco, which struggled to transform its free trade relationship with the U.S. into an advantage for regional integration, the AfCFTA presents a promising opportunity for African nations to cultivate regional value chains across various industries, from agrifood to pharmaceuticals. Future trade agreements with Global North partners should enhance, rather than detract from, this momentum.
Five actionable priorities emerge for Africa as it crafts a roadmap beyond AGOA:
- Negotiate collectively with the United States,
- Keep the AfCFTA central to the continental strategy,
- Strengthen export and production competitiveness before seeking trade preferences,
- Manage expectations wisely regarding free trade agreements, and
- Fully harness the potential of South-South trade.
The expiration of AGOA stands at a pivotal crossroads, presenting Africa with a unique opportunity to either engage in a fragmented bilateral approach or consolidate its voices to demand equitable partnerships in global trade. The direction taken will be crucial, not only for shaping trade relationships but also for determining the broader trajectory of the continent’s developmental landscape in the long term.
