US-Africa trade at a crossroads: Lessons from Morocco’s US Free Trade Agreement as AGOA expires – Brookings

Report on Post-AGOA Trade Relations and Alignment with Sustainable Development Goals

Introduction: End of an Era and the Imperative for Sustainable Trade

The African Growth and Opportunity Act (AGOA), a cornerstone of U.S.-Africa trade relations since May 2000, officially expired on September 30, 2025. The Act provided duty-free access to the U.S. market for over 1,800 products from eligible African nations, contributing to economic activity reflected in nearly $10 billion in exports in 2024. Its expiration occurs as the African Continental Free Trade Area (AfCFTA) aims to accelerate continental integration. This report analyzes the challenges and opportunities for African nations in the post-AGOA era, with a significant focus on aligning future trade strategies with the Sustainable Development Goals (SDGs), particularly SDG 8 (Decent Work and Economic Growth), SDG 5 (Gender Equality), SDG 9 (Industry, Innovation, and Infrastructure), SDG 10 (Reduced Inequalities), and SDG 17 (Partnerships for the Goals).

Case Study: The U.S.-Morocco Free Trade Agreement (USMFTA)

Economic Performance and Implications for SDG 8 and SDG 9

The USMFTA, in effect since 2006, offers critical lessons on the outcomes of bilateral North-South trade agreements. Analysis indicates mixed results concerning sustainable economic development. Morocco’s trade deficit with the U.S. has persistently widened, with imports growing faster than exports. This outcome challenges the objective of achieving sustained and inclusive economic growth as outlined in SDG 8. Furthermore, the agreement has had a limited impact on fostering economic diversification and structural transformation. In 2021, high-technology products constituted only 6% of total exports, a figure slightly below the 2001 level, indicating slow progress towards the innovation and industrialization targets of SDG 9.

Impact on Gender Equality and SDG 5

A significant consequence of the USMFTA has been a structural shift in Morocco’s export composition. Trade has moved away from female-intensive light manufacturing sectors, such as textiles and apparel, towards male-intensive, capital-heavy industries like chemical fertilizers. This trend has negatively impacted female labor force participation, representing a direct setback to the achievement of SDG 5, which aims to achieve gender equality and empower all women and girls. U.S. investment patterns in capital-intensive sectors have reinforced this gender-imbalanced outcome.

Bilateral Agreements and Challenges to SDG 10 (Reduced Inequalities)

Asymmetries in Power and Competitiveness

The Moroccan experience demonstrates how structural asymmetries in development levels and economic competitiveness can lead to unbalanced outcomes, thereby undermining SDG 10 (Reduced Inequalities). Morocco’s deeper tariff reductions compared to those of the U.S., coupled with the limited export competitiveness of its domestic firms, allowed the more advanced U.S. industrial base to gain a disproportionate advantage. The U.S. goods trade surplus with Morocco grew from $35 million in 2005 to $3.4 billion in 2024. Such agreements risk perpetuating economic inequalities between nations rather than fostering equitable partnerships for development as envisioned in SDG 17.

Strategic Recommendations for a Post-AGOA Roadmap

The expiration of AGOA necessitates a strategic re-evaluation of Africa’s trade policy. A fragmented approach centered on bilateral agreements risks replicating the unbalanced outcomes observed in the Morocco case study. A unified strategy prioritizing regional integration and sustainable development is essential. The following priorities are recommended to guide a post-AGOA roadmap that aligns with the SDGs.

Five Key Priorities for a Sustainable Trade Future

• Negotiate Collectively with Global Partners: To counter the power asymmetries inherent in bilateral negotiations and advance SDG 10, African nations should leverage the AfCFTA to negotiate as a single bloc. This strengthens their position to secure fair and equitable trade terms that support continent-wide development priorities.
• Center Strategy on the AfCFTA: The AfCFTA must remain the primary vehicle for Africa’s economic strategy. It provides a unique platform to build regional value chains, foster industrialization (SDG 9), and boost intra-African trade, creating a more resilient and integrated continental market capable of generating decent work (SDG 8).
• Strengthen Productive and Export Competitiveness: Preferential market access is insufficient without a competitive productive base. Investment in industrial capacity, innovation, and infrastructure (SDG 9) is critical to ensure that trade opportunities translate into sustainable economic growth and job creation, including for women (SDG 5).
• Manage Expectations of Free Trade Agreements: Policymakers must prudently assess the potential impacts of North-South FTAs. These agreements do not automatically guarantee structural economic transformation and can present significant risks to nascent industries and social development goals if not carefully structured.
• Harness the Potential of South-South Trade: Africa must fully explore and expand trade and investment partnerships with other emerging economies. South-South cooperation offers an alternative and complementary path to development, fostering partnerships among equals in line with the spirit of SDG 17.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

1. SDG 5: Gender Equality
   • The article directly addresses gender equality by discussing the impact of the U.S.-Morocco Free Trade Agreement (USMFTA) on female employment. It notes that the agreement led to a structural shift in Morocco’s exports away from “female-intensive light manufacturing (textiles, apparel) and toward male-intensive, capital-heavy sectors,” which “has contributed to Morocco’s low female labor force participation.”
2. SDG 8: Decent Work and Economic Growth
   • This goal is central to the article’s discussion on trade, exports, and economic outcomes. The text analyzes the economic impact of trade agreements like the African Growth and Opportunity Act (AGOA) and the USMFTA, highlighting issues such as trade deficits, export growth, and the overall effect on national economies. For instance, it states that under the USMFTA, Morocco’s “imports from the U.S. have grown faster than exports, worsening Morocco’s trade balance.”
3. SDG 9: Industry, Innovation and Infrastructure
   • The article touches upon industrial development and economic transformation. It points out the failure of the USMFTA to spur a structural transformation in Morocco, noting that “the share of high-technology exports accounted for only 6% of total exports, slightly below their share in 2001.” The recommendations for Africa to strengthen its “productive base” and build “regional value chains” also align with this goal.
4. SDG 17: Partnerships for the Goals
   • The entire article revolves around international partnerships, specifically trade agreements between African nations and the United States (AGOA, USMFTA) and intra-African partnerships (AfCFTA). It critiques “North-South bilateral trade agreements” characterized by “strong power asymmetry” and advocates for a collective, unified negotiating approach for African countries to ensure fairer, more equitable partnerships. The recommendation for Africa to “negotiate collectively with the United States” is a direct call for a stronger global partnership model.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. Under SDG 5 (Gender Equality)
   • Target 5.5: Ensure women’s full and effective participation and equal opportunities for leadership in political, economic and public life. The article’s analysis of how the USMFTA negatively impacted “female labor force participation” by shifting production to “male-intensive” sectors directly relates to the goal of ensuring women’s participation in economic life.
2. Under SDG 8 (Decent Work and Economic Growth)
   • Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation. The article highlights a lack of progress towards this target in Morocco’s case, stating that the “overall impact on the value-added composition of Morocco’s global goods exports has been mixed” and the share of high-tech exports has stagnated.
   • Target 8.a: Increase Aid for Trade support for developing countries. While not mentioning “Aid for Trade” directly, the article’s entire premise is about trade preference programs (like AGOA) designed to support developing countries’ integration into the global trading system. The expiration of AGOA and the discussion of its replacement directly concern this target.
3. Under SDG 9 (Industry, Innovation and Infrastructure)
   • Target 9.2: Promote inclusive and sustainable industrialization and, by 2030, significantly raise industry’s share of employment and gross domestic product. The article’s emphasis on the need for African countries to have a “solid productive base” and build “regional value chains” before relying on trade preferences speaks directly to the need for sustainable industrialization.
   • Target 9.b: Support domestic technology development, research and innovation in developing countries. The mention of Morocco’s low “share of high-technology exports” indicates a challenge related to this target, which focuses on upgrading the technological capabilities of industries.
4. Under SDG 17 (Partnerships for the Goals)
   • Target 17.10: Promote a universal, rules-based, open, non-discriminatory and equitable multilateral trading system. The article critiques the “unbalanced outcomes” of asymmetric bilateral agreements like the USMFTA and advocates for a fairer system, aligning with the principles of an equitable trading system.
   • Target 17.11: Significantly increase the exports of developing countries. The article analyzes the performance of AGOA, which aimed to boost African exports to the U.S. (reaching nearly “$10 billion” in 2024), and the mixed results of the USMFTA, which had a “negative effect on Moroccan exports.”

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

1. For SDG 5 (Gender Equality)
   • Female labor force participation rate: The article explicitly mentions that the trade agreement contributed to “Morocco’s low female labor force participation,” implying this is a key metric for assessing the gendered impact of economic policies.
   • Share of employment by gender and sector: The shift from “female-intensive light manufacturing” to “male-intensive, capital-heavy sectors” is a qualitative indicator of changes in the structure of women’s employment.
2. For SDG 8 & 17 (Economic Growth & Partnerships)
   • Trade balance: The article uses this indicator frequently, noting that the USMFTA worsened “Morocco’s trade balance” and that the “U.S. goods trade surplus with Morocco reached $3.4 billion in 2024.”
   • Total value of exports: The article provides the value of Africa’s exports to the U.S. under AGOA (“almost $10 billion” in 2024) as a measure of the program’s scale.
   • Share of exports to specific partners: The article indicates Morocco’s export diversification by stating that “goods exports to the U.S. constituted only 3.1% of its total goods exports, in contrast to exports to the European Union (EU), which accounted for 65.3%.”
3. For SDG 9 (Industry, Innovation and Infrastructure)
   • Share of high-technology exports in total exports: This is a direct indicator mentioned in the article: “the share of high-technology exports accounted for only 6% of total exports” for Morocco in 2021.
   • Value-added composition of exports: The article implies this indicator by stating that the “overall impact on the value-added composition of Morocco’s global goods exports has been mixed,” suggesting it is a measure of structural transformation.

4. Summary Table of SDGs, Targets, and Indicators

Source: brookings.edu