AGOA: Niels Marquardt’s opened pessimism

The deadline of December 15th, 2009 has gone, and Madagascar failed to fulfil the conditions of eligibility to the AGOA, the growth opportunity offered to African countries by the United States of America. The US administration is making an assessment, whose result will be communicated to President Barack Obama. “It is a decision of his, but I am very pessimistic anyway”, confessed H.E. Ambassador Niels Marquardt. According to his explanations, hope is scarce, not to say gone, since ” The President is compelled to make a decision before December 31st to have it implemented on January 01st “. Niels Marquardt estimated that the few African countries which recently underwent extra constitutional government’s change have been granted enough reprieve to recover the path of democracy through “the constitution of national union governments “. “The situation is not to ease the matter, but it remains at any rate the necessary condition”, he emphasized. Expected since August 2009 following the Maputo agreements and charter, the government meant to be inclusive and consensual, as were the other transitional institutions, failed to be born. Calling off the meeting between the four mobilities, supposed to be monitored by the International Contact Group in Antananarivo, is almost Madagascar’s death sentence regarding the AGOA stake. “Do keep hopeful”, moderated ambassador Marquardt. The AGOA will be renewable could normality ever be restored”. This spot optimism will not, if it has to, come true before the end of the transitional period. “As every year, since nine years, there will be a declaration from the American President concerning the AGOA beneficiary countries”. The American Congress has already displayed its inclination to suspend Madagascar from the AGOA in 2010. President Obama’s decision should be confirming this resolution, but game is not over yet until the final official whistle. The American government would cancel custom privileges and advantages so far enjoyed by Madagascar. The textile sector will be hugely affected, since the orders will inevitably be getting seldom for having to face up to a 30% high price increase. One good half of the garment manufacturing 150 factories are making their living on exports to the United States. Watching some of them shutting doors due to order cancellation for the beginning of the year 2010 was the so much feared economic cataclysm’s sign. Madagascar’s economy will inevitably be burdened by the loss of the AGOA. The American market represents more 300 millions of dollars of garment exports, simply the country’s top leading source of foreign returns. The social impact is significant since at least 250 000 jobs would be directly or indirectly suppressed. The most troublesome consequence would be the loss the investors’ confidence. Even though Madagascar successfully appeared inescapable by its production capacity, the cyclic political crises are not to adorn its resume. Big industrial groups have rather extend their production potential to other countries as India to limit damages. The suspension of the AGOA, whose main criteria happens to be the respect of the rule of law, necessarily depicts a bad investment potential for a country.