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Cablegate: Senegal Is On Its Way to Improve Its Agoa Textile

VZCZCXRO5061
PP RUEHMA RUEHPA
DE RUEHDK #1541 3581100
ZNR UUUUU ZZH
P 241100Z DEC 09
FM AMEMBASSY DAKAR
TO RUEHC/SECSTATE WASHDC PRIORITY 3523
INFO RUCPDOC/USDOC WASHDC PRIORITY
RUEHRC/USDA WASHDC PRIORITY
RUEHAR/AMEMBASSY ACCRA PRIORITY 1783
RUEHZK/ECOWAS COLLECTIVE

UNCLAS DAKAR 001541

SENSITIVE
SIPDIS

STATE FOR AF/W AND AF/EPS
STATE PLS PASS TO USTR/CHAMILTON

E.O. 12958: N/A
TAGS: ETRD SENV EAGR EINV EFIN EAID SG
SUBJECT: SENEGAL IS ON ITS WAY TO IMPROVE ITS AGOA TEXTILE
LEGISLATION

1. Summary: On December 21 2009, Minister of Trade Amadou Niang
chaired a meeting to finalize amendments to a decree governing the
issuance by the Customs Office of an approval stamp that allows
textile products to be shipped from Senegal to the United States
under the aegis of the African Growth and Opportunity Act (AGOA).
The Minister underlined that, after 9 years, Senegal still continues
to lag in its ability to reap the full benefits of this trade
opportunity. He averred that Senegal has the capacity to make AGOA
a success, especially in textiles, but that opaque, outdated, and
poorly drafted legal texts are major obstacles. End Summary.

2. The Government of Senegal has often been blamed for failing to
benefit from AGOA because it has yet to promote it vigorously
enough. As a result, President Abdoulaye Wade stated that AGOA will
be made a priority and, as a first step, the government decided to
change its legislation to make it more conducive for Senegalese
entrepreneurs wanting to export to the US. The regulatory
provisions to export textiles and apparel are governed by Decree No
2002-73 of 03 March 2002. This decree outlines all dispositions to
establish the necessary legal and institutional basis for exporting
textiles through AGOA. The problem with the decree is that, at the
time, the drafters took a shortcut choosing to translate the United
States's AGOA textile legislation (Textile Visa and Category 9)
instead of drafting a new document. Additionally, many of the
portions were mistranslated. Thus, a new decree is now needed to
improve and clarify some of the specific provisions that were not
addressed in the original one.

3. The meeting, which was the culmination of several others, brought
together a variety of stakeholders to include the Embassy, the West
African Trade Hub (WATH), the Senegalese Export Administration
(ASEPEX), Customs, and Ministry of Trade officials and local
businesses already exporting to the U.S. under AGOA. All were
invited to assist and contribute in the formulation of the new
decree. Minister Niang personally invited Mission personnel to
attend. WATH, who were represented by Senegal WATH Director Makhtar
Thiam and WATH's Ghana Support Service Coordinator Abdou Fall, were
key in correcting mistakes in the old decree and proposing
amendments to the new draft.

4. The new draft, which has been completed and which will be
presented for approval at the next meeting of the Council of
Ministers, has been simplified and procedures have been shortened.
For example: beforehand, a multiplicity of agencies was involved in
the issuance of the aforementioned export stamp but the new
legislation envisages a "one-stop shop" at ASEPEX, which will work
with Customs to facilitate exports. ASEPEX will be in charge of
helping exporters prepare the necessary paperwork and Customs will
be in charge of delivering the stamp. Additionally, a provision to
curb fraud, especially when declaring what materials go into a given
product, has been added.

Comment
-------

5. Working on more conducive legislation to promote exports to the
U.S. via AGOA is definitely a step in the right direction, but there
is still a long way to go. While this decree narrowly focuses on
amending regulations concerning the issuance of a stamp to export
textiles products, the Minister said that the government is aware
that it needs to revise all legislation covering the slew of
products that can be exported to the U.S. under AGOA. However, if
Senegal is going to seriously penetrate the American market, there
need to be increased efforts by the government to build up export
capacity. Even though the textile sector remains one of the main
targets of Senegal's Accelerated Growth Strategy, to date no serious
actions had been taken to promote textile trade. End Comment.
Bernicat

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