The United States of America have removed Uganda and 3 other African countries from the African Growth and Opportunity Act (Agoa) trade deal.
The US said it struck Uganda off at the end of December, saying the country is no longer a beneficiary of Agoa.
The United States also removed three other African countries, the Central African Republic, Gabon, and Niger, from Agoa, effective from January 1.
The decree by US President Joe Biden on December 29 will effectively end Kampala’s ability to export certain commodities to the US without added tax.
It could have a serious impact on the Ugandan economy, which has significantly benefited from the programme since its establishment in 2000.
Report has it that the decision by the US to remove Uganda from Agoa was made after the country passed its controversial Anti-Homosexuality Act last year, a law which could impose life imprisonment or even the death penalty for same sex conduct.
In October, Biden said that Uganda’s removal from Agoa was due to “gross violations of internationally recognised human rights.”
“Despite intensive engagement between the United States and the Central African Republic, Gabon, Niger, and Uganda, these countries have failed to address United States concerns about their non-compliance with the Agoa eligibility criteria,” Biden said in a letter to the speaker of the US House of Representatives.
Agoa gives eligible sub-Saharan African countries duty-free access to the US for more than 1,800 products.
It is set to expire in December 2025, although the US has signalled intentions to extend it.
Under the deal, Uganda has mostly exported agriculture goods, as well as textiles, duty-free to the United States.
Over 80 per cent of the East African country’s exports to the US were from the agricultural sector, which employs about 72 percent of the workforce.
Its expulsion from Agoa could now lead to thousands of job losses, and a decline in economic growth.
In the 12 months to June 2023, Uganda’s exports to the US under Agoa amounted to $8.2 million, about 11.5 percent of its total exports to the US in the same period, totalling $70.7 million.
