MCC & The African Growth & Opportunity Act (AGOA)

The Millennium Challenge Corporation is a leading contributor to the U.S. government’s trade capacity building assistance to AGOA-eligible countries, responsible for 58 percent of assistance from 2001 to 2013.

MCC has obligated nearly $3 billion in funding for trade capacity building activities in 15 of the 41 African Growth and Opportunity Act countries. This aid focuses on trade-related infrastructure such as roads and electricity, improving the productivity of small and medium-sized businesses and export-oriented industries, and leveraging policy and regulatory reforms. Major MCC projects have included expansions to the critical sea ports of Benin and Cabo Verde, and roads used for commerce in Ghana, Senegal, Tanzania, and Mozambique.

Benin's Port of Cotonou is the country’s only port and is a pillar of Benin’s economic growth. The port contributes to West African economic growth, serving as the gateway to international trade for the landlocked countries of Burkina Faso, Mali and Niger and is a central pathway for international trade with Nigeria. MCC's investment expanding the port is just one example of the agency's commitment to promoting trade capacity in AGOA countries.

Trade and Investment in AGOA Countries:
Promoting Public-Private Partnerships & Regional Integration in Africa

MCC and U.S. development efforts are committed to an investment-led development model that leverages other sources of financing, including domestic resources and the private sector. 

As part of MCC’s efforts to drive growth and reduce poverty around the world, MCC announced in July 2015 a $70 million commitment to support public-private partnerships in partner countries. African countries alone will receive grants totaling $52 million. These investments are expected to generate $1 billion in private-sector investments over the next five years, with $750 million of that expected to be invested in Africa. 

Regional integration helps create economies of scale, strengthen value chains, and ease the movement of technology and people. People, goods and services move across borders, and MCC’s investments should too. Regional MCC investments would be a significant U.S. Government tool to increase trade capacity and improve the uptake of AGOA preferences. With regional authority, MCC could design programs that significantly improve trade and investment between and among MCC partner countries by promoting economic growth and cross-border engagement. This could result in larger and more harmonized markets for trade and development, and new opportunities for American companies.

A Cornerstone of U.S.-Africa Economic Engagement

Enacted in May 2000 and re-authorized by Congress in June 2015, the African Growth and Opportunity Act (AGOA) is the cornerstone of U.S. economic engagement with the countries of sub-Saharan Africa. By providing duty-free access to the U.S. market, AGOA helps eligible nations diversify their exports to the United States and ultimately create jobs and inclusive economic growth. 

Since its implementation, AGOA has encouraged new investments, trade and job creation in Africa and the United States. Total African exports under AGOA more than quadrupled since the program’s inception. As of June 2015, AGOA-eligible countries have exported nearly $480 billion worth of goods to the United States under AGOA and the U.S. Generalized System of Preferences. In 2014, non-oil AGOA trade was valued at $4.4 billion, up about 250 percent from 2001. The growth of these non-oil industries has spurred an estimated 300,000 direct jobs in beneficiary countries and 120,000 jobs in the U.S.