Imports Of Denim Into USA From AGOA For 2015 – 2017

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The African Growth and Opportunity Act (AGOA) is a United States Trade Act, enacted on 18 May 2000 as Public Law 106 of the 200th Congress. AGOA has since been renewed to 2025. The legislation significantly enhances market access to the US for qualifying Sub-Saharan African (SSA) countries.The countries which are currently eligible to have duty free access to US markets under this act include the following :
Angola; Benin; Botswana; Burkina Faso; Burundi; Cameroon; Cape Verde; Chad; Comoros; Republic of Congo; Cote d’Ivoire; Djibouti; Ethiopia; Gabon; The Gambia; Ghana; Guinea; Kenya; Lesotho; Liberia; Madagascar; Malawi; Mali; Mauritania; Mauritius; Mozambique; Namibia; Niger; Nigeria; Rwanda; Sao Tome and Principe; Senegal; Seychelles; Sierra Leone; South Africa; Tanzania; Togo; Uganda and  Zambia.
The main purpose of the special act had been to provide special privileges to the underdeveloped African countries to enable them develop their apparel industry and export more to the US markets duty free. However, over the period of time, the AGOA countries have not really performed too well and did not use this special facility to try to upgrade themselves and develop their infrastructure. However, some countries among them are organizing themselves and trying to take the advantage of extended period that the AGOA act provides. Among them some countries like Ethiopia are encouraging international investments and pulling out all stops to increase their exports and hence their economy.
Lets look at how denim exports from AGOA are faring from for the last 2 years and into the second quarter of this year . We analyze their performance using following tables and graphs :

Table Of Contents

S N.

                                                                                       Particulars

1.

Table showing the imports of All denim apparel to USA from AGOA for the period 2015 to 2017

2.

Graph showing the imports of All denim apparel to USA from AGOA for the period 2015 to 2017

3.

Graph showing the Average price of All denim apparel to USA from AGOA for the period 2015 to 2017

4.

Table showing the imports of Men’s / Boys Jeans to USA from AGOA for the period 2015 to 2017

5.

Graph showing the imports of Men’s / Boys Jeans to USA from AGOA for the period 2015 to  2017

6.

Graph showing the Average price of Men’s / Boys Jeans to USA from AGOA for the period 2015 to 2017

7.

Table showing the imports of Women’s / Girls Jeans to USA from AGOA for the period 2015 to 2017

8.

Graph showing the imports of Women’s / Girls Jeans to USA from AGOA for the period 2015 to 2017

9.

Graph showing the Average price Women’s / Girls Jeans to USA from AGOA for the period 2015 to 2017

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1. Imports Of All Denim’s apparel

The first six month of year 2017 looks promising as 8.74 million pcs of denim apparel at an average price of USD 7.2 / PC has been exported to USA and if this trend will follow till the end , the figures will be closed to about 17 million pcs of denim apparels. The imports in 2016 was little bit disappointing as  the imports dropped to 13.46 million pcs which is approx. 40% lesser that what it exported in the year 2015 ie about 22 million pcs. This fall in 2016 was also due to the market slowdown situation in US and with a slightly recovering market in 2017 , we can see better performance. We can also add here that Ethiopia has made a first time small contribution of about 200,000 denim garment exports to US during 2017 whereas previously it was NIL. It seems that in the coming years, Ethiopia might actually become the largest contributor.
Lesotho continues to be the top exporter with about 60% of total exports followed distantly by Madagascar, Kenya and Mauritius. Madagascar , after coming back in AGOA in 2015, is now building up its volumes and exports accordingly. The average price remains more or less stable around USD 7.2 per piece . This is , however, higher than the price at which Bangladesh exports to US.

Year of Import

All Denim Apparel (Million Pcs)

Total Value (Million USD)

Average Price (USD / PC)

2015

22.27

158.52

7.1

2016

13.46

100.84

7.5

(Upto Q2) |2017

8.74

62.89

7.2

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

a. Men’s / Boys Jeans

Segregating Denim Apparels into both Men and Women , we found Women jeans cheaper than Men’s  . The average price for Men’s jeans for the year 2017 is USD 7.3/Pc however for the women’s jeans , it is USD 6.7/pc . In terms of exports , export of men’s jeans is approx. five  times the export of Women’s Jeans in the first half of 2017 indicating that the market is shifting towards the men’s jeans . First six month of 2017 show 7.28 million pcs for Men’s Jeans and 1.45 million pcs for Women’s jeans . The year 2016 was disappointing as both the category Men’s segment saw a decline of 30 % whereas Women’s segment saw a decline of about 64 %.
The year 2017 again looks promising for the exports of Men’s jeans and it is expected that the exports might close at about 15 million pieces – which would be about the same as that in 2015.

Year of Import

Men’s / Boys Jeans (Million Pcs)

Total Value (Million USD)

Average Price(USD / PC)

2015

15.66

115.04

7.4

2016

9.47

72.26

7.6

Q2|2017

7.28

53.16

7.3

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

b. Women’s / Girls Jeans

The figures below shows that the exports upto second quarter 2017 was 1.45 million pcs and if same trend is followed till the year end than the exports may hardly touch upto 2.9 million pcs which is quite less than the exports in 2015 and 2016. Seems that the buyers have been shifting their sourcing of women jeans more and more to countries like Bangladesh and Vietnam and hence the quantities coming to AGOA countries have dropped in this segment. Besides, women jeans are high fashion and require quicker turnaround and for which the African countries are currently not so much adapted. Kenya has been a better performer for women jeans exports as compared to its men’s jeans category and is second after Lesotho in women jeans exports.

Year of ImportS

Women’s / Girls Jeans (Million Pcs)

Total Value (Million USD)

Average Price (USD / PC)

2015

6.61

43.49

6.6

2016

3.98

28.27

7.1

Q2|2017

1.45

9.73

6.7

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

Imports Of Denim Into USA From AGOA At The End Of Q2, 2017 From 2015

All in all, we find that the AGOA currently is not performing what is expected from it . We speak of AFRICA being the next frontier of apparel exports but with its current performance it may take over a decade for it to make some substantial impact on global stage. However, AGOA will expire in 2025 unless extended and we need to see if it really will be extended.

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