Farewell AGOA

It looks like the US has finally had enough of the illegal regime of Andry Rajoelina and has recently decided to end Madagascar’s eligibility for AGOA (African Growth and Opportunity Act). Related articles: AllAfrica and DefenceWeb

This could potentially have a HUGE impact on the economy and an even bigger impact on the textile industry of Madagascar. According to this July, 2009 Reuters article the industry could face collapse if it is no longer eligible for AGOA. Here are some high level points of that article:

  • Madagascar’s textile industry makes  $600 million a year.
  • Half of the 150 textile factories (employing 50,000 people) supply the following US companies: Walmart, Bloomingdale’s, PUMA and Adidas.
  • Madagascar’s textile industry contributes to 6.5 – 8% of the country’s GDP
  • Clothing exports from Madagascar to the US totalled $278.8 million in 2008.
  • More than half of Madagascar’s textile exports are destined for the US.
  • When US exports dry up, it will drive up costs in Europe which will cause Madagascar’s exports to become ‘unattractive’.
  • If AGOA is not in place, Madagascar’s distance would make it a very expensive operation due to fuel and electricity costs.
  • Mauritius, Swaziland and Lesotho stand to experience an impact if Madagascar loses AGOA as they supply textile materials to Madagascar.

According to the AGOA info page on Madagascar, since the country’s exports have been eligible under AGOA the number of exports from Madagascar have grown 3-fold.

The events of 2009 have had a tragic impact on Madagascar  and any progress that it has made since 1999/2002 virtually reversing the progress that the country has made. Over the course of 2010 we are going to start to see the textile industry suffer and slowly die, adding those 50,000 people to the already high number of poor and unemployed people on the island.

It is really sad to sit back and watch a country that was finally starting to make progress and prosper to fall apart as quickly as it has. I was rooting for Madagascar and the progress it was making, especially the difference I had witnessed in only 3 years between my family’s visits.

Now it is just frustrating:

  • Frustrating that I don’t feel like my family can go back to visit Madagascar in its current state.
  • Frustrating to see how long this coup d’etat has been allowed to drag on.
  • Frustrating that this whole thing was started on the lie that Rajoelina was somehow going save the poor from the evil Ravalomanana, who despite any conflicts of interest for his presidency has done way more good than bad.
  • Frustrating that Rajoelina is using diplomacy as a tool to prolong his control over the country. He knows full well that all everyone wants to do is come together and reach an agreement to resolve the crisis, but he continually negotiates, then breaks negotations to stall progress.
  • Frustrating that the army is siding with Rajoelina and allowed the coup to happen and that they are not doing anything to correct their mistake.
  • Frustrating that I know there will never be other way to approach the political crisis other than negotiations (and cannot be any other way).
  • Frustrated that Rajoelina himself is too greedy and does not see what is happening to his own country as a direct result of his actions. That he doesn’t have the wisdom to realize his mistake and start working towards a resolution to the mess that he has made.

I honestly don’t think that we will see anything good come of the crisis in 2010, I can only hope that Rajoelina finally gives up and we can start repairing the damage that has been done.


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