US sanctions on Ethiopia to be effective from January 1

Biden’s letter to Congress said Ethiopia has not met eligibility requirements to remain a beneficiary.

AGOA offers sub-Saharan African nations duty-free access to the United States on the condition they meet certain requirements, including eliminating barriers to US trade and investment and making progress toward political pluralism.

Suspension of AGOA benefits is bound to threaten the country’s aspirations to turn a light manufacturing hub. The decision will also affect global fashion brands like The Children's Place, Tommy Hilfiger and Calvin Klein that outsource manufacturing to Ethiopian apparel makers.

The country has spent billions constructing a dozen industrial parks and related infrastructure over the past decade. Ethiopia exported about $237 million worth of goods free of duty to the United States under AGOA in 2020, according to US commerce department data; more than nine-tenths of that was textiles and apparel.

Biden said Ethiopia was in “gross violations of internationally recognized human rights”. He also cited Guinea and Mali, which have experienced coups this year, in the letter for being out of compliance.

US trade representative Katherine Tai said in a statement her office would "provide each country with clear benchmarks for a pathway toward reinstatement and our administration will work with them to achieve that objective.”

The Ethiopian government had lobbied against the move. “We are extremely disappointed by the threat of AGOA withdrawal currently under consideration by the US government," the country’s ministry of trade said in a statement, warning that it will "reverse significant economic gains in our country and unfairly impact and harm women and children. Ethiopia will continue to make every effort to correct any unintended or perceived wrongs.”

US Horn of Africa envoy Jeffrey Feltman told reporters that the humanitarian conditions in Tigray were ‘unacceptable’, a global newswire reported.

Along with Ethiopia, Guinea and Mali will also be removed from the AGOA on January 1, 2022.

Fibre2Fashion News Desk (DS)