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African tariffs may hurt US firms

East Africa wants a ban on imports of secondhand clothing from the US.It’s expected that such a ban will cause job losses in the US, causing up to 75 per cent reduction in revenues for some US textile businesses.

The East African Community (EAC) says imports of secondhand US clothing have caused a decline in the African textile industry.

The African Growth and Opportunity Act (AGOA) allows several African nations favorable trade arrangements with the US. But AGOA requires countries to have a market-based economy or to be at least making progress towards one. It is felt that any import ban or tariffs would halt this progress towards a free-market system in EAC countries.

Countries like Kenya, Tanzania, Rwanda and Uganda have import tariffs. As a result 40 per cent of small and medium textile firms in the US have reduced employment by at least 25 per cent since the tariff increases, 88 per cent of firms have experienced a revenue reduction of at least 25 per cent since the tariff increases and more than 52 per cent say they would be forced to reduce their number of employees by at least 50 per cent if the full ban were implemented.