6. 1). Agencies for TCB Assistance for AGOA Countries

Total U.S. government funding for TCB assistance for AGOA countries  from 2001 to 2013 was approximately $5 billion. According to our analysis of the U.S. government’s  TCB database, MCC and USAID are the agencies that reported providing  the most funding for AGOA countries, and accounted for 90 percent of all  TCB assistance to these countries from 2001 through 2013 (see fig. MCC’s and USAID’s TCB Assistance in Support of AGOA Has Primarily Focused on Barriers to Trade- Related Infrastructure and Agriculture, and Trade Facilitation

		MCC Has Taken Steps to Support AGOA through TCB Assistance That Is Generally Focused on Trade-Related Infrastructure Needs, but Broader Infrastructure Challenges Remain

MCC’s TCB-related activities in sub-Saharan Africa are supportive of  AGOA. From 2005 through 2013, MCC funded TCB  activities in 15 of the 41 AGOA countries (see table 2). This compact included $176 million in trade-related  infrastructure assistance for a roads project rehabilitating 491  kilometers of key segments of the country’s transportation network. USAID has funded TCB assistance activities in 39  of 41 AGOA countries; see table 3 for AGOA countries with the highest  USAID TCB funding. USAID Has Worked with Some Host Governments on Strategic Approaches to AGOA Utilization, but Most Host Governments Have Not Established Such Approaches

		USAID Has Worked with Some Host Governments to Develop Strategic Approaches to AGOA Utilization

USAID works with some host governments to develop strategic  approaches to increasing AGOA utilization. AGOA legislation also directs the  President, in part, to target assistance to sub-Saharan African  governments. In the strategy documents, host  governments may identify high-priority trade and investment sectors,  constraints related to AGOA utilization, and specific steps to increase  exports under AGOA. For example, the East Africa trade hub participated  in a 2013 workshop with officials from the Mauritian government, and  helped the host government develop and publish its AGOA-specific  national strategy, which aims to support the ability of Mauritian firms to  sell to the U.S. market and leverage opportunities that AGOA provides. USAID,  through its trade hubs, has stated that identifying strategic needs and  priorities through national strategies can bolster AGOA utilization. USAID officials also said that  host governments must request and initiate the process of developing  these strategies, and the lack of political will to motivate these efforts may  be one reason some AGOA countries do not have such a strategic  approach. Recommendation for Executive Action

To enhance eligible countries’ ability to utilize the AGOA program and  ensure that TCB assistance is aligned with program objectives, we  recommend that the Administrator of USAID work with more host  governments to develop strategic approaches to promoting exports under  AGOA. Appendix I: Objectives, Scope, and Methodology

Our objectives were to examine (1) U.S. government trade capacity  building (TCB) assistance in support of the African Growth and  Opportunity Act (AGOA), and (2) the extent to which the U.S. Agency for  International Development (USAID) has made efforts to develop strategic  approaches to AGOA utilization. In each country, we interviewed U.S. agency  officials, host government officials, representatives from the private sector  who had insights on U.S. TCB assistance, and contractors implementing  TCB activities. To examine U.S. government TCB assistance in support of AGOA, we  reviewed documents from relevant U.S. agencies, including program  descriptions and evaluations, and analyzed data on U.S. TCB funding to  AGOA countries. GAO-14-602.
Why GAO Did This Study

Signed in 2000, AGOA directs the President to provide TCB assistance to sub-Saharan African governments and firms to promote exports and develop infrastructure, among other things. AGOA provides duty-free access on qualifying U.S. imports from eligible sub-Saharan African countries, a total of 41 countries as of December 1, 2014. From 2001 through 2013, U.S. agencies funded about $5 billion in TCB assistance to AGOA countries. GAO was asked to review various issues related to the ability of AGOA countries to utilize AGOA prior to its expiration on September 30, 2015.
In this report, GAO examines (1) U.S. government TCB assistance in support of AGOA, and (2) the extent to which USAID has made efforts to develop strategic approaches to AGOA utilization. GAO focused on MCC and USAID because these two agencies accounted for nearly 90 percent of funding for TCB activities in AGOA countries from 2001 through 2013. GAO analyzed data on U.S. TCB assistance to AGOA countries in this period, reviewed agencies' funding and program documents, conducted interviews with officials who implement U.S. TCB assistance, and met with U.S. and foreign government officials and private sector representatives in Ethiopia and Ghana.

What GAO Found

Among U.S. agencies, the Millennium Challenge Corporation (MCC) and the U.S. Agency for International Development (USAID) have funded the majority of trade capacity building (TCB) assistance in support of the African Growth and Opportunity Act (AGOA) (see figure). MCC obligated nearly $3 billion in funding for TCB activities in 15 of the 41 countries eligible for AGOA (AGOA countries), with the majority of funds provided for trade-related infrastructure projects. For example, MCC obligated $176 million for a roads project in Mozambique that aimed to improve the transportation network, including access to markets and reduction of transport costs. USAID obligated approximately $1.6 billion in funding for TCB activities in 39 of the 41 AGOA countries, with the majority of funds provided for trade-related agriculture and infrastructure, and trade facilitation. For example, USAID funded activities to help exporters in East Africa build business linkages with U.S. markets through trade shows.
Note: Funding amounts or percentages may not sum to totals because of rounding.
USAID has worked with some host governments to develop strategic approaches to AGOA utilization; however, most host governments have not established such approaches. USAID-funded regional trade hubs in sub-Saharan Africa have supported AGOA utilization by, among other things, collaborating with some host governments to develop AGOA-specific or broader national export strategies. Trade hub evaluations and statements from host government officials show that identifying strategic needs and priorities through strategic approaches can bolster AGOA utilization and help assess challenges to expanding exports. In strategy documents, host governments may identify high-priority trade and investment sectors, constraints related to AGOA utilization, and specific steps to increase exports under AGOA. Lack of a strategic approach has been identified as a significant reason for gaps in AGOA utilization. As of December 2014, 14 of the 41 AGOA countries had strategies reflecting AGOA priorities. According to USAID officials, host governments must initiate the process of developing a strategy, and a lack of political will may pose challenges to such efforts.

What GAO Recommends

GAO recommends that the Administrator of USAID work with more host governments to develop strategic approaches to promoting exports under AGOA. USAID agreed with the recommendation.