The advantage of preferential trade agreements is that they can bring about lasting structural changes. After 18 years in which agoA benefited eging, a predictable general balance analysis from the World Bank in 2018 showed that the termination of AGOA by 2020 would result in a 1% revenue loss and a 16 per cent decline in the textile and clothing industry. But simulations have also shown that trade facilitation measures, which reduce the average cost of trade by 2% per year, would eliminate the negative income effects resulting from the elimination of AGOA. AGOA`s protection of the child industry has allowed the industry to grow and prosper, so that a reduction in trade costs of only 2 per cent would allow it to maintain its competitiveness. The signing of the framework protocol will not immediately create a free trade area. Countries have yet to conclude negotiations on protocols on trade in goods and services, intellectual property rights, investment and competition. The calendar. Negotiations on trade agreements can take several years. In just over three and a half months, the United States will hold its presidential elections. As we saw in Obama`s transition to the Trump administration, trade negotiations can be interrupted.
If Biden wins in November, will his government continue negotiations with Kenya? The strong support of all parties in Congress over four governments for programs in Africa indicates that there will be continuity in this initiative. Another challenge is that the Trade Promotion Authority (TPA) – the law that sets the parameters for consultation between the government and Congress and guarantees a vote on the final agreement – expires in July 2021. In the absence of the PA, the final implementation law could be amended by Congress, which could unravel it. Another possible complication is that President Kenyatta`s second term will end in 2022. He sees the free trade agreement as a inherited burden of the past. Will it be completed by then? And then there`s the reality of COVID-19.