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Cablegate: Nigeria's Likely Reactions to Expiration of Agoa

This record is a partial extract of the original cable. The full text of the original cable is not available.

011124Z Jun 04

UNCLAS ABUJA 000961

SIPDIS

SENSITIVE

STATE ALSO PASS TO USTR

E.O. 12958: N/A
TAGS: ETRD PREL WTRO ECON NI
SUBJECT: NIGERIA'S LIKELY REACTIONS TO EXPIRATION OF AGOA
THIRD-COUNTRY FABRIC PROVISION

REF: A. STATE 120038

B. STATE 120719
C. ABUJA 277
D. ABUJA 290
E. 03 ABUJA 2231
F. 03 ABUJA 2184

SENSITIVE BUT UNCLASSIFIED, NOT FOR PUBLICATION ON THE
INTERNET OR INTRANET.

1. (SBU) In response to the Department's request concerning a
failure to extend the AGOA third-country fabric provision
(Ref A), post believes there could be important political
effects on both the bilateral and multilateral fronts,
although the economic effect would be slight.

--------------------------------
TEXTILE VISA STILL A MAJOR ISSUE
--------------------------------

2. (SBU) While the impact on Nigerian industry will be
slight, given Nigerian export problems (Ref D), there could
be much more political fallout. President Obasanjo and other
Nigerian leaders often raise AGOA, and specifically the
long-delayed provision of an AGOA Textile Visa for Nigeria
(Ref C). (Note: The GON provided the Textile Visa documents
to post, and post provided them to USTR and the Department on
December 27, 2003 -- Ref E.) Although Nigerians do not
export much other than oil under AGOA to the U.S., it is a
prominent feature of the bilateral relationship in Nigerian
minds. Nigeria's new Ambassador to the U.S. raised AGOA in
his first meeting with the Secretary on May 27 (Ref B).
While the discourse about AGOA is usually positive, we would
expect Nigerians to add failure to extend the AGOA
third-country fabric provision to their complaints over the
delay in the Textile Visa.

3. (SBU) Reaction from Nigerian industry is apt to be low
decibel. Nigeria is not exporting garments made of
third-country fabric to the United States, nor is Nigeria
likely to do so within the next two years. Post proposed a
program to improve Nigeria's use of AGOA for non-oil exports
to the U.S. (Ref F), but has yet to receive a response from
USDOC or the Department.

------------------------------------------
MULTILATERAL EFFECTS IN AFRICA AND THE WTO
------------------------------------------

4. (SBU) Even if Nigeria is not itself a main beneficiary of
the provision, its government will sympathize with African
states whose benefits might cease with the provision's
expiration on September 30, 2004. The GON might interpret
U.S. congressional inaction to extend the provision another
three years as waning American interest in the development of
Africa's manufacturing and export capacity, hence in its
overall development. Nigeria's reaction could well be to
rally to the support of other states at the WTO sharing such
sentiments, which might make it more difficult for us to
achieve broader objectives in that forum.
CAMPBELL

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