As the US Senate deliberates the AGOA Renewal and Improvement Act of 2024, extending the African Growth and Opportunity Act (AGOA) until 2041, the Pan-African Chamber of Commerce and Industry (PACCI) has raised critical concerns. While the 16-year extension offers stability for Africa-US trade relations, PACCI emphasizes the need for greater flexibility to ensure the legislation benefits African economies without creating undue barriers.

A Welcome Extension, But Challenges Persist

The new legislation proposes several updates to AGOA, including enhanced eligibility criteria, stricter compliance standards for textile exports, and provisions to align with regional integration efforts under the African Continental Free Trade Area (AfCFTA). However, these changes come with potential risks for African exporters.

Kebour Ghenna, Executive Director of PACCI, applauds the extension but cautions against provisions that may unintentionally exclude countries or create compliance bottlenecks.

“We welcome the stability that the 16-year extension brings,” said Ghenna. “But the new criteria must reflect Africa’s economic realities and avoid punitive measures that hinder trade opportunities. Flexibility is crucial for creating an inclusive and impactful framework.”

Key Concerns

1. Stricter Eligibility Criteria
   The revised act introduces detailed requirements on corruption, human rights, and labor practices. Countries flagged in US reports, such as the Trafficking in Persons Report and the Child Soldiers Prevention Act, could face suspension from AGOA. PACCI warns that many African countries risk disqualification due to the subjective nature of these criteria.

“Eligibility criteria should be progressive, offering African countries the technical and financial support needed to meet these standards rather than outright disqualification,” Ghenna argued.

2. Textile Compliance Regulations
   The emphasis on supply chain scrutiny, particularly regarding Chinese cotton under the Uyghur Forced Labour Prevention Act, complicates compliance for African apparel exporters.

“The textile sector is a major job creator in Africa,” Ghenna noted. “We must ensure that these new provisions do not disrupt the sector’s growth or exclude smaller exporters.”

3. Out-of-Cycle Reviews
   The new legislation allows Congress to initiate out-of-cycle reviews at any time, introducing unpredictability for African exporters. This uncertainty could deter long-term investment and trade planning.

Opportunities to Build On

Despite its challenges, the legislation contains promising elements, including:

• A 16-year extension, offering businesses and investors long-term planning stability.
• Support for AfCFTA integration, with updated rules of origin allowing regional value chain participation by all AfCFTA member states.
• $100 million in trade capacity-building funds, aimed at improving customs operations, export promotion, and trade-related infrastructure.

“These provisions have the potential to unlock new opportunities for African economies,” Ghenna said. “However, they must be implemented in a way that prioritizes inclusivity and practicality.”

PACCI’s Recommendations

PACCI is advocating for adjustments to the act, including:

• Introducing grace periods or support mechanisms to help countries meet the updated eligibility criteria.
• Providing technical assistance to build local textile and apparel value chains and reduce dependency on imports.
• Ensuring transparent review processes to minimize trade disruptions.
• Expanding AGOA’s product coverage to include more goods critical to African economies.

A Call for African Unity

As the debate over AGOA’s renewal intensifies, PACCI calls on African governments and businesses to actively engage with US lawmakers. “We must ensure this legislation reflects Africa’s aspirations for sustainable development and economic growth,” Ghenna concluded.

PACCI is also urging its members to issue a unified press release in support of AGOA’s extension while advocating for much-needed reforms to safeguard the interests of African businesses.

By striking a balance between compliance and flexibility, AGOA can continue to serve as a cornerstone of Africa-US trade relations, fostering economic growth and integration across the continent.

Nyala Insurance S.C. (NISCO) has announced a gross profit of Birr 636.4 million for the previous fiscal year, achieving a remarkable 109.5 percent growth despite the challenging macroeconomic and socio-political conditions in the country.

During the 30th General and 23rd Extraordinary General Meeting held on November 26, 2024, at the Sheraton Addis, Dr. Sara Surur, Chair of the Board of Directors, presented the company’s annual performance report to shareholders. She highlighted a significant increase in gross profit, which rose from Birr 303.7 million to Birr 636.4 million, more than doubling the previous year’s figure. As a result, earnings per share (EPS) increased from Birr 354 to Birr 502, reflecting a 42 percent rise.

Dr. Surur also emphasized that NISCO generated over Birr 1.6 billion from general, long-term (life), and takaful insurance operations, marking a 20 percent increase. Of this total, the general insurance segment accounted for approximately 74 percent, while long-term insurance premiums and takaful represented increases of 18.7 percent and 7.6 percent, respectively.

Additionally, she noted that the company’s total assets grew to Birr 4.5 billion, representing an 18.8 percent increase from the previous fiscal year. This growth was partly attributed to increased equity from capital investments made by shareholders.

Conversely, Dr. Surur reported that the company disbursed approximately Birr 350 million in claims to customers, which is a 5.6 percent decrease from the previous year.

Yared Mola, CEO of Nyala Insurance S.C., expressed the company’s commitment to improving operational efficiency, enhancing customer satisfaction, and expanding into untapped markets, particularly those that are underserved.

“This year marks the second year of our ambitious strategic period. We are focusing on digital transformation and innovation to meet our customers’ evolving needs. To advance our goals, we have restructured NISCO to drive innovation and enhance service delivery, positioning ourselves as a future-ready organization. In line with this vision, we have introduced a new customer-centric initiative by transforming our branches into Customer Experience Hubs (የደንበኞች ቤት),” he stated.

The CEO explained that these hubs are designed to enhance customer interactions by integrating the customer experience concept at every touchpoint, ensuring a smooth and personalized service journey for each customer. This transformation underscores the company’s commitment to elevating service quality and delivering an exceptional experience for clients.

Yared emphasized the company’s dedication to becoming a forward-thinking, technology-driven institution that prioritizes customer satisfaction and operational efficiency.

Founded in 1995 with a paid-up and subscribed capital of Birr 7 million and 25 million, Nyala Insurance S.C. is a robust and innovative financial institution that offers tailored products and services, including microinsurance, mobile insurance, and diaspora insurance.