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America sets terms for AGOA eligibility


Billy Ntaote

LESOTHO will need to “take concrete steps” in addressing the United States’ governance benchmarks in the first quarter of 2017 to safeguard its eligibility for trade preferences under the African Growth and Opportunity Act (AGOA) for the full calendar year.

The Americans say Lesotho was deemed eligible for AGOA in 2017 to give the Mountain Kingdom more time to meet the benchmarks which include implementation of the Southern African Development Community (SADC) Commission of Inquiry recommendations, security sector reforms and facilitating an amnesty for the detained mutiny suspects.

AGOA provides for duty-free entry of goods into the US from designated sub-Saharan African countries, including Lesotho, and applies to both textile and non-textile goods. The legislation, which was approved by the US Congress in May 2000 is meant to incentivise African countries to open their economies and build free markets.

It was renewed for another 10 years in June 2015 as the AGOA Extension & Enhancement Act and amended to allow the US to withdraw, suspend or limit benefits if designated AGOA countries do not comply with its eligibility criteria.

The law obligates the American president to designate countries eligible to benefit from the trade facility on an annual basis after undergoing a review process. Among the main eligibility criteria for the facility are a market-based economy, rule of law, systems to combat corruption, and not engaging in gross violations of internationally-recognised human rights.

Lesotho’s textile and garment industry, which is anchored on AGOA, employs more than 40 000 people, in addition to other downstream sectors.

The Mountain Kingdom’s eligibility for AGOA had been thrown into doubt after the Millennium Challenge Corporation (MCC) last Wednesday deferred a vote on the reselection of Lesotho for a second compact “until governance concerns have been addressed”.

The MCC is a bilateral American foreign aid agency established by the United States Congress in 2004, with countries expected to meet certain conditions such as good governance and respect for the rule of law to qualify.

In 2008, Lesotho was granted a five-year compact valued at US$362.5 million (over M3 billion) towards expanding water supply for household and industrial use, strengthening the country’s health care system and removing barriers to foreign and local private sector investment.

However, the US government had insisted that Lesotho would only continue to benefit from AGOA and to receive a second MCC compact after taking “concrete actions” that address concerns about “impunity and the rule of law” as well as implementing recommendations made by the SADC Commission of Inquiry. A determination on Lesotho’s eligibility for a second MCC compact will be made in March 2017.

The news of Lesotho’s AGOA eligibility came as a relief for Basotho, after the uncertainty surrounding the decision had cast a dark shadow over the textile industry and economy in general.

Announcing the decision on Thursday, Trade and Industry Minister Joshua Setipa admitted the Americans remained concerned about Lesotho’s failure to meet governance benchmarks for AGOA eligibility.

“The board that assesses the eligibility of countries for AGOA decided that Lesotho should continue to be part of the facility. However, that does not mean they were still not concerned about the issues they said should be urgently addressed,” he said, adding the Americans had underscored three major concerns.

“Firstly, they expressed concern over the plight of detained soldiers facing mutiny charges and called on the government to grant them amnesty as soon as possible or pursue other avenues to facilitate their release.”

The 23 soldiers were arrested between May and June 2015 for allegedly plotting to violently remove the LDF command. Eight of the soldiers have since been released from Maseru Maximum Security Prison and placed under open arrest, which is a form of bail in the military. The other 15 remain in detention.

The SADC inquiry recommended an amnesty for the soldiers who are facing mutiny charges before the Court Martial.

Mr Setipa said the Americans were also concerned by the Amnesty Bill, 2016 which is meant to grant members of the security sector a blanket amnesty for offences committed between January 2007 and December 2015. In its current form, the bill would extend to members of the LDF whom the SADC Commission of Inquiry had recommended should face prosecution.

“Secondly, they are concerned about a draft law the government has prepared for parliament to work on and meant to grant amnesty to people who were allegedly involved in disturbances dating as far back as 2007,” he said.

“They said the bill was too broad and seemed to give people who should face prosecution for various crimes the chance to avoid facing justice.”

The US government was also concerned by the lack of discernible progress in the investigation of the killing of former army commander Maaparankoe Mahao.

The former army chief was shot dead as he left his Mokema farm on 25 June 2015 by soldiers who said they had come to arrest him for being part of a group of soldiers plotting to overthrow the army leadership. However, the Mahao family has accused the army of killing him in cold blood basing on the account of his nephews who were with him during the incident.

After the killing, Prime Minister Pakalitha Mosisili asked SADC to probe the incident, with the inquiry carrying out its investigations between 31 August and 23 October 2015.

The Justice Mpaphi Phumaphi-led commission made a number of recommendations, including the dismissal of army commander Lieutenant-General Tlali Kamoli, suspension of LDF officers implicated in cases of murder, attempted murder and treason while investigations into the allegations proceeded in line with international best practice.

Said Mr Setipa: “The Americans said there was no progress in the investigation into the death of Ntate Maaparankoe Mahao and implored the Lesotho government to continue to address this issue speedily.”

The minister said his lobbying had finally paid off since negotiations with US Trade Representative Ambassador Michael Froman had been ongoing over the course of the year.

“In April this year, I received a letter from my US counterpart (Ambassador Froman) in which he outlined a list of concerns they had with regards to Lesotho.

“Our role as government has been to demonstrate and guarantee to our American friends and other development partners that we were committed to addressing these concerns.”

Mr Setipa said he had made endless trips to the United States to lobby for the renewal of AGOA and a second MCC compact.

“I constantly went to the US to ensure the US Trade Representative, Congress and non-governmental organisations in the country were aware of what we were doing as government to address the concerns related to the issues covered by the SADC report.”

He said a second MCC compact was not lost for Lesotho, but required the government to fulfil eligibility benchmarks.

“The second compact has a programme to assist small, micro and medium enterprise owners to grow their businesses as well as assisting in removing barriers to trade in the country. So, it was up to the MCC board to approve or defer,” Mr Setipa said.

“The MCC board decided to defer the decision on Lesotho’s eligibility to a meeting scheduled for March 2017 to allow us to demonstrate more progress. As a result, the MCC compact is not lost for Lesotho since they have given us room to deal with the concerns they raised.”

US Embassy Spokesperson Dan Kobayashi yesterday told the Sunday Express the government needed to take more steps to demonstrate adherence to AGOA eligibility criteria to safeguard eligibility for the full calendar year.

He said the eligibility criteria was related to respect for human rights, rule of law and due process as underlined by Ambassador Froman.

“In a March 2016 letter to the government of Lesotho, US Trade Representative Ambassador Michael Froman identified specific benchmarks which would be considered in reviewing Lesotho’s continued AGOA eligibility, including implementation of the Southern African Development Community (SADC) Commission of Inquiry recommendations, security sector reform efforts and access for international organizations to verify the conditions of Lesotho Defence Force (LDF) personnel in custody in light of SADC report findings of torture and abuse,” Mr Kobayashi said, adding the concerns should be addressed in the first quarter of 2017.

He said that given the SADC Commission had concluded that the “whole case of mutiny [is] highly suspect”, they “encourage” the government to grant the detained mutiny suspects amnesty “or to look for other avenues to facilitate their expeditious release”.

The Americans have also called on Maseru to grant access for international organisations to verify the conditions of the detained mutiny suspects in light of the SADC Report findings of torture and abuse

Mr Kobayashi said the decision to make Lesotho AGOA eligible was meant to afford the Kingdom an opportunity to put its house in order. He emphasised that the retirement of Lt-Gen Kamoli on 1 December this year was not sufficient in implementing SADC Commission of Inquiry recommendations.

“This decision was taken to allow Lesotho more time to meet certain benchmarks to demonstrate that it is making progress toward meeting AGOA’s eligibility criteria. While the recent leadership change in the Lesotho Defence Force was a positive first step to meet these benchmarks, the government of Lesotho has yet to meet the remaining benchmarks.”

He said the AGOA Extension & Enhancement Act provided the US government greater flexibility in reviewing countries on an ongoing basis, with eligibility either withdrawn, suspended or limited in the event of failure to abide by the benchmarks.

“The new AGOA legislation provides the administration greater flexibility in reviewing countries on an ongoing basis, including by initiating ‘out-of-cycle’ reviews at any point during the calendar year,” said Mr Kobayashi.

“The US is looking for concrete actions which demonstrate clear commitment to accountability, rule of law, and due process.  This includes taking concrete steps on the implementation of the SADC Commission of Inquiry’s January 2016 recommendations. These include facilitating an amnesty for the detained mutiny suspects, and investigating and bringing to justice those who were implicated in the murder of Brigadier Mahao.”

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