[Congressional Record Volume 145, Number 43 (Thursday, March 18, 1999)]
[Senate]
[Pages S2949-S2954]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LUGAR (for himself, Mr. Gramm, Mr. McCain, Mr. DeWine, Mr. 
        Hagel, Mr. Grams, Mr. Jeffords, Ms. Landrieu, and Mr. 
        Lieberman):
  S. 666. A bill to authorize a new trade and investment policy for 
sub-Saharan Africa; to the Committee on Finance.


               african growth and opportunity act (agoa)

 Mr. LUGAR. Mr. President, I rise to introduce the African 
Growth and Opportunity Act (AGOA). I'm pleased to be joined by Senators 
McCain, Gramm, Hagel, DeWine and Grams as original cosponsors. Our bill 
is designed to provide a broad U.S. policy framework towards the nearly 
fifty countries in sub-Sahara Africa. Specifically, the bill seeks to 
develop active partnerships with African countries through a set of 
trade and investment initiatives and incentives in exchange for a 
commitment from those countries to make the transition to market 
economies.
  For decades U.S. policy towards Africa was based largely on a series 
of bilateral aid relationships. Our involvement in Africa was 
influenced by strategic considerations inherent in the cold war. Our 
assistance programs targeted humanitarian crises and natural disasters 
and they helped nurture a variety of health, nutritional, educational 
and agricultural programs. As important as these programs have been, 
they have not promoted much economic development, fostered much self-
reliance or promoted political stability for the vast majority of the 
people of sub-Sahara Africa. Nor have they particularly benefitted the 
American economy. For these reasons, it is long past due that the 
United States re-evaluate this policy. That is the purpose of our bill.
  Last year, a similar bill was introduced and passed in the House of 
Representatives but did not reach the floor of the Senate. The bill has 
been introduced last month in the House and the House committees have 
been active. Already, the bill is scheduled to be reported by both the 
Ways and Means and International Relations Committees very soon. I 
understand that it is scheduled for a floor vote in the House in the 
next several weeks.
  The Administration supports this legislation because it mirrors its 
own initiatives on Africa. Indeed, President Clinton cited the 
initiative and the bill in his last two State of the Union addresses 
before the Congress. Virtually all African Ambassadors have endorsed 
this bill and are committed to working to pass and enact it this year. 
Our bill enjoys support within the American business community and 
among many non-governmental organizations involved in Africa.
  Mr. President, the AGOA is intended to promote greater economic self-
reliance in Africa through enhanced private sector activity and trade 
incentives for those countries meeting eligibility requirements and 
wishing to participate. The bill authorizes the President to grant 
duty-free treatment to certain products currently excluded from the GSP 
program, subject to the sensitivity analysis of the International Trade 
Commission. It extends the GSP program for Africa for 10 years, a 
provision which is important for long-term business planning.
  The bill also would increase access to U.S. markets for African 
textiles and other products. It would remove U.S. quotas on African 
textile imports which now amount to less than one percent of our 
worldwide textile imports. The bill includes unusually strong 
transshipment language that is the toughest ever proposed. The U.S. 
International Trade Commission estimated last year that reducing 
tariffs on textiles from Africa would have a negligible effect on our 
economy but would give a high boost to Africa's fledgling manufacturing 
base. The jobs and foreign exchange earnings that would be gained in 
Africa under this initiative will enable Africans to purchase more 
products from the United States.
  In my judgement, the AGOA is a modest bill which, if adopted, could 
have immodest results in Africa. It takes a long-term view and provides 
a policy road map for achieving economic growth and opportunity. It 
will take some time for the initiatives embedded in this legislation to 
have a measurable impact on economic growth in Africa. Nonetheless, we 
need to look ahead over the next decades and to assist wherever 
possible in the development of those areas that have not been 
successfully or fully integrated into the world economy. Much of Africa 
falls into this category. My bill is intended to help facilitate that 
transition. Strategic planning now will help create a better, more 
productive and prosperous future.

  Mr. President, our bill includes a number of other attractive 
provisions. It includes two new private sector financed funds--an 
equity fund and an infrastructure fund both of which would be backed by 
the Overseas Private Investment Corporation (OPIC). If successful, 
these funds will lead to improvements in such areas as African roads, 
telecommunications and power plants each of which can accelerate 
economic activity in Africa. It includes provisions for enhanced 
visibility for Africa in our international deliberations on trade and 
finance and increased technical assistance for economic management. It 
establishes a Forum to facilitate high level discussions on trade and 
investment policies between the U.S. and Africa.
  Most importantly, our bill signals the start of a new era in U.S.-
African relations based less on bilateral aid ties and more business 
relationships, less on paternalism and more on partnerships, and one 
that builds upon the long term prospects of African societies rather 
than on short-term, reactive policies.
  Many African societies have been undergoing impressive political and 
economic transformations. Africa's economic potential is substantial. 
There are more than 600 million people in sub-Sahara Africa, but 
Africa's share of foreign annual direct investment commands less than 
two percent of global direct investment flows. Much of that capital 
comes from Europe which has an established market and investment 
presence in Africa. Nonetheless, several African countries enjoy 
sustained economic growth at or above 6%, despite the strains in the 
global economy that began in Southeast Asia and spread to other parts 
of the world. Indeed, U.S. Trade with sub-Sahara Africa exceeds our 
trade with all the states of the former Soviet Union combined and the 
potential for expansion will grow as these economies expand and mature.
  The enhanced trade and private investment benefits in the bill will 
be available to all African societies but especially to those countries 
which undertake sustained economic reform, maintain acceptable human 
rights practices and make progress towards good governance. These 
standards are similar to those applied in other parts of the world. 
Indeed, without these standards the private sector would be unlikely to 
invest in Africa.
  The United States can play a significant role in helping promote 
Africa development. We have a historic opportunity to help integrate 
African countries into the global economy, to re-think dependency on 
foreign assistance and to help strengthen civil society and economic 
and political institutions. No one believes this bill is a panacea for 
Africa, but it is very much in our interests to play a constructive 
role in the evolving economic transition in Africa. If the United 
States has the vision to be a major player in Africa's economic and 
political improvement, we will also be a major beneficiary. If we are 
successful, Africa will provide new trade and investment opportunities 
for the United States. It will also improve the quality of life for a 
broader segment of the people of Africa, a goal we must all support and 
applaud.
  Mr. President, I ask that the proposed African Growth and Opportunity 
Act (AGOA) section-by-section description be printed in the Record.
  The material follows:

                                 S. 666

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``African 
     Growth and Opportunity Act''.
       (b) Table of Contents.--

Sec. 1. Short title; table of contents.

[[Page S2950]]

Sec. 2. Findings.
Sec. 3. Statement of policy.
Sec. 4. Eligibility requirements.
Sec. 5. Sub-Saharan Africa defined.

              TITLE I--TRADE POLICY FOR SUB-SAHARAN AFRICA

Sec. 101. United States-Sub-Saharan Africa Trade and Economic 
              Cooperation Forum.
Sec. 102. United States-Sub-Saharan Africa Free Trade Area.
Sec. 103. Eliminating trade barriers and encouraging exports.
Sec. 104. Generalized system of preferences.
Sec. 105. Assistant United States trade representative for Sub-Saharan 
              Africa.
Sec. 106. Reporting requirement.

TITLE II--INTERNATIONAL FINANCIAL AND FOREIGN RELATIONS POLICY FOR SUB-
                             SAHARAN AFRICA

Sec. 201. International financial institutions and debt reduction.
Sec. 202. Executive branch initiatives.
Sec. 203. Sub-Saharan Africa Infrastructure Fund.
Sec. 204. Overseas Private Investment Corporation and Export-Import 
              Bank initiatives.
Sec. 205. Expansion of the United States and foreign commercial service 
              in Sub-Saharan Africa.
Sec. 206. Donation of air traffic control equipment to eligible Sub-
              Saharan African countries.

     SEC. 2. FINDINGS.

       The Congress finds that it is in the mutual economic 
     interest of the United States and sub-Saharan Africa to 
     promote stable and sustainable economic growth and 
     development in sub-Saharan Africa and that sustained economic 
     growth in sub-Saharan Africa depends in large measure upon 
     the development of a receptive environment for trade and 
     investment. To that end, the United States seeks to 
     facilitate market-led economic growth in, and thereby the 
     social and economic development of, the countries of sub-
     Saharan Africa. In particular, the United States seeks to 
     assist sub-Saharan African countries, and the private sector 
     in those countries, to achieve economic self-reliance by--
       (1) strengthening and expanding the private sector in sub-
     Saharan Africa, especially women-owned businesses;
       (2) encouraging increased trade and investment between the 
     United States and sub-Saharan Africa;
       (3) reducing tariff and nontariff barriers and other trade 
     obstacles;
       (4) expanding United States assistance to sub-Saharan 
     Africa's regional integration efforts;
       (5) negotiating free trade areas;
       (6) establishing a United States-Sub-Saharan Africa Trade 
     and Investment Partnership;
       (7) focusing on countries committed to accountable 
     government, economic reform, and the eradication of poverty;
       (8) establishing a United States-Sub-Saharan Africa 
     Economic Cooperation Forum; and
       (9) continuing to support development assistance for those 
     countries in sub-Saharan Africa attempting to build civil 
     societies.

     SEC. 3. STATEMENT OF POLICY.

       The Congress supports economic self-reliance for sub-
     Saharan African countries, particularly those committed to--
       (1) economic and political reform;
       (2) market incentives and private sector growth;
       (3) the eradication of poverty; and
       (4) the importance of women to economic growth and 
     development.

     SEC. 4. ELIGIBILITY REQUIREMENTS.

       (a) In General.--A sub-Saharan African country shall be 
     eligible to participate in programs, projects, or activities, 
     or receive assistance or other benefits under this Act if the 
     President determines that the country does not engage in 
     gross violations of internationally recognized human rights 
     and has established, or is making continual progress toward 
     establishing, a market-based economy, such as the 
     establishment and enforcement of appropriate policies 
     relating to--
       (1) promoting free movement of goods and services between 
     the United States and sub-Saharan Africa and among countries 
     in sub-Saharan Africa;
       (2) promoting the expansion of the production base and the 
     transformation of commodities and nontraditional products for 
     exports through joint venture projects between African and 
     foreign investors;
       (3) trade issues, such as protection of intellectual 
     property rights, improvements in standards, testing, labeling 
     and certification, and government procurement;
       (4) the protection of property rights, such as protection 
     against expropriation and a functioning and fair judicial 
     system;
       (5) appropriate fiscal systems, such as reducing high 
     import and corporate taxes, controlling government 
     consumption, participation in bilateral investment treaties, 
     and the harmonization of such treaties to avoid double 
     taxation;
       (6) foreign investment issues, such as the provision of 
     national treatment for foreign investors, removing 
     restrictions on investment, and other measures to create an 
     environment conducive to domestic and foreign investment;
       (7) supporting the growth of regional markets within a free 
     trade area framework;
       (8) governance issues, such as eliminating government 
     corruption, minimizing government intervention in the market 
     such as price controls and subsidies, and streamlining the 
     business license process;
       (9) supporting the growth of the private sector, in 
     particular by promoting the emergence of a new generation of 
     African entrepreneurs;
       (10) encouraging the private ownership of government-
     controlled economic enterprises through divestiture programs; 
     and
       (11) observing the rule of law, including equal protection 
     under the law and the right to due process and a fair trial.
       (b) Additional Factors.--In determining whether a sub-
     Saharan African country is eligible under subsection (a), the 
     President shall take into account the following factors:
       (1) An expression by such country of its desire to be an 
     eligible country under subsection (a).
       (2) The extent to which such country has made substantial 
     progress toward--
       (A) reducing tariff levels;
       (B) binding its tariffs in the World Trade Organization and 
     assuming meaningful binding obligations in other sectors of 
     trade; and
       (C) eliminating nontariff barriers to trade.
       (3) Whether such country, if not already a member of the 
     World Trade Organization, is actively pursuing membership in 
     that Organization.
       (4) Where applicable, the extent to which such country is 
     in material compliance with its obligations to the 
     International Monetary Fund and other international financial 
     institutions.
       (5) The extent to which such country has a recognizable 
     commitment to reducing poverty, increasing the availability 
     of health care and educational opportunities, the expansion 
     of physical infrastructure in a manner designed to maximize 
     accessibility, increased access to market and credit 
     facilities for small farmers and producers, and improved 
     economic opportunities for women as entrepreneurs and 
     employees, and promoting and enabling the formation of 
     capital to support the establishment and operation of micro-
     enterprises.
       (6) Whether or not such country engages in activities that 
     undermine United States national security or foreign policy 
     interests.
       (c) Continuing Compliance.--
       (1) Monitoring and review of certain countries.--The 
     President shall monitor and review the progress of sub-
     Saharan African countries in order to determine their current 
     or potential eligibility under subsection (a). Such 
     determinations shall be based on quantitative factors to the 
     fullest extent possible and shall be included in the annual 
     report required by section 106.
       (2) Ineligibility of certain countries.--A sub-Saharan 
     African country described in paragraph (1) that has not made 
     continual progress in meeting the requirements with which it 
     is not in compliance shall be ineligible to participate in 
     programs, projects, or activities, or receive assistance or 
     other benefits, under this Act.

     SEC. 5. SUB-SAHARAN AFRICA DEFINED.

       For purposes of this Act, the terms ``sub-Saharan Africa'', 
     ``sub-Saharan African country'', ``country in sub-Saharan 
     Africa'', and ``countries in sub-Saharan Africa'' refer to 
     the following or any successor political entities:
       Republic of Angola (Angola)
       Republic of Botswana (Botswana)
       Republic of Burundi (Burundi)
       Republic of Cape Verde (Cape Verde)
       Republic of Chad (Chad)
       Democratic Republic of Congo
       Republic of the Congo (Congo)
       Republic of Djibouti (Djibouti)
       State of Eritrea (Eritrea)
       Gabonese Republic (Gabon)
       Republic of Ghana (Ghana)
       Republic of Guinea-Bissau (Guinea-Bissau)
       Kingdom of Lesotho (Lesotho)
       Republic of Madagascar (Madagascar)
       Republic of Mali (Mali)
       Republic of Mauritius (Mauritius)
       Republic of Namibia (Namibia)
       Federal Republic of Nigeria (Nigeria)
       Democratic Republic of Sao Tome and Principe (Sao Tome and 
     Principe)
       Republic of Sierra Leone (Sierra Leone)
       Somalia
       Kingdom of Swaziland (Swaziland)
       Republic of Togo (Togo)
       Republic of Zimbabwe (Zimbabwe)
       Republic of Benin (Benin)
       Burkina Faso (Burkina)
       Republic of Cameroon (Cameroon)
       Central African Republic
       Federal Islamic Republic of the Comoros (Comoros)
       Republic of Cote d'Ivoire (Cote d'Ivoire)
       Republic of Equatorial Guinea (Equatorial Guinea)
       Ethiopia
       Republic of the Gambia (Gambia)
       Republic of Guinea (Guinea)
       Republic of Kenya (Kenya)
       Republic of Liberia (Liberia)
       Republic of Malawi (Malawi)
       Islamic Republic of Mauritania (Mauritania)
       Republic of Mozambique (Mozambique)
       Republic of Niger (Niger)
       Republic of Rwanda (Rwanda)
       Republic of Senegal (Senegal)
       Republic of Seychelles (Seychelles)
       Republic of South Africa (South Africa)
       Republic of Sudan (Sudan)
       United Republic of Tanzania (Tanzania)
       Republic of Uganda (Uganda)
       Republic of Zambia (Zambia)

[[Page S2951]]

              TITLE I--TRADE POLICY FOR SUB-SAHARAN AFRICA

     SEC. 101. UNITED STATES-SUB-SAHARAN AFRICA TRADE AND ECONOMIC 
                   COOPERATION FORUM.

       (a) Declaration of Policy.--The President shall convene 
     annual high-level meetings between appropriate officials of 
     the United States Government and officials of the governments 
     of sub-Saharan African countries in order to foster close 
     economic ties between the United States and sub-Saharan 
     Africa.
       (b) Establishment.--Not later than 12 months after the date 
     of the enactment of this Act, the President, after consulting 
     with Congress and the governments concerned, shall establish 
     a United States-Sub-Saharan Africa Trade and Economic 
     Cooperation Forum (in this section referred to as the 
     ``Forum'').
       (c) Requirements.--In creating the Forum, the President 
     shall meet the following requirements:
       (1) The President shall direct the Secretary of Commerce, 
     the Secretary of the Treasury, the Secretary of State, and 
     the United States Trade Representative to host the first 
     annual meeting with the counterparts of such Secretaries from 
     the governments of sub-Saharan African countries eligible 
     under section 4, the Secretary General of the Organization of 
     African Unity, and government officials from other 
     appropriate countries in Africa, to discuss expanding trade 
     and investment relations between the United States and sub-
     Saharan Africa and the implementation of this Act including 
     encouraging joint ventures between small and large 
     businesses.
       (2)(A) The President, in consultation with the Congress, 
     shall encourage United States nongovernmental organizations 
     to host annual meetings with nongovernmental organizations 
     from sub-Saharan Africa in conjunction with the annual 
     meetings of the Forum for the purpose of discussing the 
     issues described in paragraph (1).
       (B) The President, in consultation with the Congress, shall 
     encourage United States representatives of the private sector 
     to host annual meetings with representatives of the private 
     sector from sub-Saharan Africa in conjunction with the annual 
     meetings of the Forum for the purpose of discussing the 
     issues described in paragraph (1).
       (3) The President shall, to the extent practicable, meet 
     with the heads of governments of sub-Saharan African 
     countries eligible under section 4 not less than once every 
     two years for the purpose of discussing the issues described 
     in paragraph (1). The first such meeting should take place 
     not later than twelve months after the date of the enactment 
     of this Act.
       (d) Dissemination of Information by USIA.--In order to 
     assist in carrying out the purposes of the Forum, the United 
     States Information Agency shall disseminate regularly, 
     through multiple media, economic information in support of 
     the free market economic reforms described in this Act.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as may be necessary to carry out 
     this section.
       (f) Limitation on Use of Funds.--None of the funds 
     authorized under this section may be used to create or 
     support any nongovernmental organization for the purpose of 
     expanding or facilitating trade between the United States and 
     sub-Saharan Africa.

     SEC. 102. UNITED STATES-SUB-SAHARAN AFRICA FREE TRADE AREA.

       (a) Declaration of Policy.--The Congress declares that a 
     United States-Sub-Saharan Africa Free Trade Area should be 
     established, or free trade agreements should be entered into, 
     in order to serve as the catalyst for increasing trade 
     between the United States and sub-Saharan Africa and 
     increasing private sector development in sub-Saharan Africa.
       (b) Plan Requirement.--
       (1) In general.--The President, taking into account the 
     provisions of the treaty establishing the African Economic 
     Community and the willingness of the governments of sub-
     Saharan African countries to engage in negotiations to enter 
     into free trade agreements, shall develop a plan for the 
     purpose of entering into one or more trade agreements with 
     sub-Saharan African countries eligible under section 4 in 
     order to establish a United States-Sub-Saharan Africa Free 
     Trade Area (in this section referred to as the ``Free Trade 
     Area'').
       (2) Elements of plan.--The plan shall include the 
     following:
       (A) The specific objectives of the United States with 
     respect to the establishment of the Free Trade Area and a 
     suggested timetable for achieving those objectives.
       (B) The benefits to both the United States and sub-Saharan 
     Africa with respect to the Free Trade Area.
       (C) A mutually agreed-upon timetable for establishing the 
     Free Trade Area.
       (D) The implications for and the role of regional and sub-
     regional organizations in sub-Saharan Africa with respect to 
     the Free Trade Area.
       (E) Subject matter anticipated to be covered by the 
     agreement for establishing the Free Trade Area and United 
     States laws, programs, and policies, as well as the laws of 
     participating eligible African countries and existing 
     bilateral and multilateral and economic cooperation and trade 
     agreements, that may be affected by the agreement or 
     agreements.
       (F) Procedures to ensure the following:
       (i) Adequate consultation with the Congress and the private 
     sector during the negotiation of the agreement or agreements 
     for establishing the Free Trade Area.
       (ii) Consultation with the Congress regarding all matters 
     relating to implementation of the agreement or agreements.
       (iii) Approval by the Congress of the agreement or 
     agreements.
       (iv) Adequate consultations with the relevant African 
     governments and African regional and subregional 
     intergovernmental organizations during the negotiations of 
     the agreement or agreements.
       (c) Reporting Requirement.--Not later than 12 months after 
     the date of the enactment of this Act, the President shall 
     prepare and transmit to the Congress a report containing the 
     plan developed pursuant to subsection (b).

     SEC. 103. ELIMINATING TRADE BARRIERS AND ENCOURAGING EXPORTS.

       (a) Findings.--The Congress makes the following findings:
       (1) The lack of competitiveness of sub-Saharan Africa in 
     the global market, especially in the manufacturing sector, 
     make it a limited threat to market disruption and no threat 
     to United States jobs.
       (2) Annual textile and apparel exports to the United States 
     from sub-Saharan Africa represent less than 1 percent of all 
     textile and apparel exports to the United States, which 
     totaled $54,001,863,000 in 1997.
       (3) Sub-Saharan Africa has limited textile manufacturing 
     capacity. During 1999 and the succeeding 4 years, this 
     limited capacity to manufacture textiles and apparel is 
     projected to grow at a modest rate. Given this limited 
     capacity to export textiles and apparel, it will be very 
     difficult for these exports from sub-Saharan Africa, during 
     1999 and the succeeding 9 years, to exceed 3 percent annually 
     of total imports of textile and apparel to the United States. 
     If these exports from sub-Saharan Africa remain around 3 
     percent of total imports, they will not represent a threat to 
     United States workers, consumers, or manufacturers.
       (b) Sense of the Congress.--It is the sense of the Congress 
     that--
       (1) it would be to the mutual benefit of the countries in 
     sub-Saharan Africa and the United States to ensure that the 
     commitments of the World Trade Organization and associated 
     agreements are faithfully implemented in each of the member 
     countries, so as to lay the groundwork for sustained growth 
     in textile and apparel exports and trade under agreed rules 
     and disciplines;
       (2) reform of trade policies in sub-Saharan Africa with the 
     objective of removing structural impediments to trade, 
     consistent with obligations under the World Trade 
     Organization, can assist the countries of the region in 
     achieving greater and greater diversification of textile and 
     apparel export commodities and products and export markets; 
     and
       (3) the President should support textile and apparel trade 
     reform in sub-Saharan Africa by, among other measures, 
     providing technical assistance, sharing of information to 
     expand basic knowledge of how to trade with the United 
     States, and encouraging business-to-business contacts with 
     the region.
       (c) Treatment of Quotas.--
       (1) Kenya and mauritius.--Pursuant to the Agreement on 
     Textiles and Clothing, the United States shall eliminate the 
     existing quotas on textile and apparel exports to the United 
     States--
       (A) from Kenya within 30 days after that country adopts an 
     efficient visa system to guard against unlawful transshipment 
     of textile and apparel goods and the use of counterfeit 
     documents; and
       (B) from Mauritius within 30 days after that country adopts 
     such a visa system.

     The Customs Service shall provide the necessary technical 
     assistance to Kenya and Mauritius in the development and 
     implementation of those visa systems.
       (2) Other sub-saharan countries.--The President shall 
     continue the existing no quota policy for countries in sub-
     Saharan Africa. The President shall submit to the Congress, 
     not later than March 31 of each year, a report on the growth 
     in textiles and apparel exports to the United States from 
     countries in sub-Saharan Africa in order to protect United 
     States consumers, workers, and textile manufacturers from 
     economic injury on account of the no quota policy.
       (d) Customs Procedures and Enforcement.--
       (1) Actions by countries against transshipment and 
     circumvention.--The President should ensure that any country 
     in sub-Saharan Africa that intends to export textile and 
     apparel goods to the United States--
       (A) has in place a functioning and effective visa system 
     and domestic laws and enforcement procedures to guard against 
     unlawful transshipment of textile and apparel goods and the 
     use of counterfeit documents; and
       (B) will cooperate fully with the United States to address 
     and take action necessary to prevent circumvention, as 
     provided in Article 5 of the Agreement on Textiles and 
     Clothing.
       (2) Penalties against exporters.--If the President 
     determines, based on sufficient evidence, that an exporter 
     has willfully falsified information regarding the country of 
     origin, manufacture, processing, or assembly of a textile or 
     apparel article for which duty-free treatment under section 
     503(a)(1)(C) of the Trade Act of 1974 is claimed, then the 
     President shall deny to such exporter, and any successors of 
     such exporter, for a period

[[Page S2952]]

     of 2 years, duty-free treatment under such section for 
     textile and apparel articles.
       (3) Applicability of united states laws and procedures.--
     All provisions of the laws, regulations, and procedures of 
     the United States relating to the denial of entry of articles 
     or penalties against individuals or entities for engaging in 
     illegal transshipment, fraud, or other violations of the 
     customs laws shall apply to imports from Sub-Saharan 
     countries.
       (4) Monitoring and reports to congress.--The Customs 
     Service shall monitor and the Commissioner of Customs shall 
     submit to the Congress, not later than March 31 of each year, 
     a report on the effectiveness of the visa systems described 
     in subsection (c)(1) and paragraph (1) of this subsection and 
     on measures taken by countries in Sub-Saharan Africa which 
     export textiles or apparel to the United States to prevent 
     circumvention as described in Article 5 of the Agreement on 
     Textiles and Clothing.
       (e) Definition.--For purposes of this section, the term 
     ``Agreement on Textiles and Clothing'' means the Agreement on 
     Textiles and Clothing referred to in section 101(d)(4) of the 
     Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).

     SEC. 104. GENERALIZED SYSTEM OF PREFERENCES.

       (a) Preferential Tariff Treatment for Certain Articles.--
     Section 503(a)(1) of the Trade Act of 1974 (19 U.S.C. 
     2463(a)(1)) is amended--
       (1) by redesignating subparagraph (C) as subparagraph (D); 
     and
       (2) by inserting after subparagraph (B) the following:
       ``(C) Eligible countries in sub-saharan africa.--The 
     President may provide duty-free treatment for any article set 
     forth in paragraph (1) of subsection (b) that is the growth, 
     product, or manufacture of an eligible country in sub-Saharan 
     Africa that is a beneficiary developing country, if, after 
     receiving the advice of the International Trade Commission in 
     accordance with subsection (e), the President determines that 
     such article is not import-sensitive in the context of 
     imports from eligible countries in sub-Saharan Africa. This 
     subparagraph shall not affect the designation of eligible 
     articles under subparagraph (B).''.
       (b) Rules of Origin.--Section 503(a)(2) of the Trade Act of 
     1974 (19 U.S.C. 2463(a)(2)) is amended by adding at the end 
     the following:
       ``(C) Eligible countries in sub-saharan africa.--For 
     purposes of determining the percentage referred to in 
     subparagraph (A) in the case of an article of an eligible 
     country in sub-Saharan Africa that is a beneficiary 
     developing country--
       ``(i) if the cost or value of materials produced in the 
     customs territory of the United States is included with 
     respect to that article, an amount not to exceed 15 percent 
     of the appraised value of the article at the time it is 
     entered that is attributed to such United States cost or 
     value may be applied toward determining the percentage 
     referred to in subparagraph (A); and
       ``(ii) the cost or value of the materials included with 
     respect to that article that are produced in any beneficiary 
     developing country that is an eligible country in sub-
     Saharan Africa shall be applied in determining such 
     percentage.''.
       (c) Waiver of Competitive Need Limitation.--Section 
     503(c)(2)(D) of the Trade Act of 1974 (19 U.S.C. 
     2463(c)(2)(D)) is amended to read as follows:
       ``(D) Least-developed beneficiary developing countries and 
     eligible countries in sub-saharan africa.--Subparagraph (A) 
     shall not apply to any least-developed beneficiary developing 
     country or any eligible country in sub-Saharan Africa.''.
       (d) Extension of Program.--Section 505 of the Trade Act of 
     1974 (19 U.S.C. 2465) is amended to read as follows:

     ``SEC. 505. DATE OF TERMINATION.

       ``(a) Countries in Sub-Saharan Africa.--No duty-free 
     treatment provided under this title shall remain in effect 
     after June 30, 2009, with respect to beneficiary developing 
     countries that are eligible countries in sub-Saharan Africa.
       ``(b) Other Countries.--No duty-free treatment provided 
     under this title shall remain in effect after June 30, 1999, 
     with respect to beneficiary developing countries other than 
     those provided for in subsection (a).''.
       (e) Definition.--Section 507 of the Trade Act of 1974 (19 
     U.S.C. 2467) is amended by adding at the end the following:
       ``(6) Eligible country in sub-saharan africa.--The terms 
     `eligible country in sub-Saharan Africa' and `eligible 
     countries in sub-Saharan Africa' mean a country or countries 
     that the President has determined to be eligible under 
     section 4 of the African Growth and Opportunity Act.''.
       (f) Effective Date.--The amendments made by this section 
     take effect on July 1, 1999.

     SEC. 105. ASSISTANT UNITED STATES TRADE REPRESENTATIVE FOR 
                   SUB-SAHARAN AFRICA.

       (a) Sense of Congress.--It is the sense of the Congress 
     that the position of Assistant United States Trade 
     Representative for African Affairs is integral to the United 
     States commitment to increasing United States--sub-Saharan 
     African trade and investment.
       (b) Maintenance of Position.--The President shall maintain 
     a position of Assistant United States Trade Representative 
     for African Affairs within the Office of the United States 
     Trade Representative to direct and coordinate interagency 
     activities on United States-Africa trade policy and 
     investment matters and serve as--
       (1) a primary point of contact in the executive branch for 
     those persons engaged in trade between the United States and 
     sub-Saharan Africa; and
       (2) the chief advisor to the United States Trade 
     Representative on issues of trade with Africa.
       (c) Funding and Staff.--The President shall ensure that the 
     Assistant United States Trade Representative for African 
     Affairs has adequate funding and staff to carry out the 
     duties described in subsection (b), subject to the 
     availability of appropriations.

     SEC. 106. REPORTING REQUIREMENT.

       The President shall submit to the Congress, not later than 
     1 year after the date of the enactment of this Act, and not 
     later than the end of each of the next 6 1-year periods 
     thereafter, a comprehensive report on the trade and 
     investment policy of the United States for sub-Saharan 
     Africa, and on the implementation of this Act. The last 
     report required by section 134(b) of the Uruguay Round 
     Agreements Act (19 U.S.C. 3554(b)) shall be consolidated and 
     submitted with the first report required by this section.
TITLE II--INTERNATIONAL FINANCIAL AND FOREIGN RELATIONS POLICY FOR SUB-
                             SAHARAN AFRICA

     SEC. 201. INTERNATIONAL FINANCIAL INSTITUTIONS AND DEBT 
                   REDUCTION.

       (a) Better Mechanisms To Further Goals for Sub-Saharan 
     Africa.--It is the sense of the Congress that the Secretary 
     of the Treasury should instruct the United States Executive 
     Directors of the International Bank for Reconstruction and 
     Development, the International Monetary Fund, and the African 
     Development Bank to use the voice and votes of the Executive 
     Directors to encourage vigorously their respective 
     institutions to develop enhanced mechanisms which further the 
     following goals in eligible countries in sub-Saharan Africa:
       (1) Strengthening and expanding the private sector, 
     especially among women-owned businesses.
       (2) Reducing tariffs, nontariff barriers, and other trade 
     obstacles, and increasing economic integration.
       (3) Supporting countries committed to accountable 
     government, economic reform, the eradication of poverty, and 
     the building of civil societies.
       (4) Supporting deep debt reduction at the earliest possible 
     date with the greatest amount of relief for eligible poorest 
     countries under the ``Heavily Indebted Poor Countries'' 
     (HIPC) debt initiative.
       (b) Sense of Congress.--It is the sense of the Congress 
     that relief provided to countries in sub-Saharan Africa which 
     qualify for the Heavily Indebted Poor Countries debt 
     initiative should primarily be made through grants rather 
     than through extended-term debt, and that interim relief or 
     interim financing should be provided for eligible countries 
     that establish a strong record of macroeconomic reform.

     SEC. 202. EXECUTIVE BRANCH INITIATIVES.

       (a) Statement of Congress.--The Congress recognizes that 
     the stated policy of the executive branch in 1997, the 
     ``Partnership for Growth and Opportunity in Africa'' 
     initiative, is a step toward the establishment of a 
     comprehensive trade and development policy for sub-Saharan 
     Africa. It is the sense of the Congress that this Partnership 
     is a companion to the policy goals set forth in this Act.
       (b) Technical Assistance To Promote Economic Reforms and 
     Development.--In addition to continuing bilateral and 
     multilateral economic and development assistance, the 
     President shall target technical assistance toward--
       (1) developing relationships between United States firms 
     and firms in sub-Saharan Africa through a variety of business 
     associations and networks;
       (2) providing assistance to the governments of sub-Saharan 
     African countries to--
       (A) liberalize trade and promote exports;
       (B) bring their legal regimes into compliance with the 
     standards of the World Trade Organization in conjunction with 
     membership in that Organization;
       (C) make financial and fiscal reforms; and
       (D) promote greater agribusiness linkages;
       (3) addressing such critical agricultural policy issues as 
     market liberalization, agricultural export development, and 
     agribusiness investment in processing and transporting 
     agricultural commodities;
       (4) increasing the number of reverse trade missions to 
     growth-oriented countries in sub-Saharan Africa;
       (5) increasing trade in services; and
       (6) encouraging greater sub-Saharan participation in future 
     negotiations in the World Trade Organization on services and 
     making further commitments in their schedules to the General 
     Agreement on Trade in Services in order to encourage the 
     removal of tariff and nontariff barriers.

     SEC. 203. SUB-SAHARAN AFRICA INFRASTRUCTURE FUND.

       (a) Initiation of Funds.--It is the sense of the Congress 
     that the Overseas Private Investment Corporation should 
     exercise the authorities it has to initiate an equity fund or 
     equity funds in support of projects in the countries in sub-
     Saharan Africa, in addition to the existing equity fund for 
     sub-Saharan Africa created by the Corporation.
       (b) Structure and Types of Funds.--

[[Page S2953]]

       (1) Structure.--Each fund initiated under subsection (a) 
     should be structured as a partnership managed by professional 
     private sector fund managers and monitored on a continuing 
     basis by the Corporation.
       (2) Capitalization.--Each fund should be capitalized with a 
     combination of private equity capital, which is not 
     guaranteed by the Corporation, and debt for which the 
     Corporation provides guaranties.
       (3) Infrastructure fund.--One or more of the funds, with 
     combined assets of up to $500,000,000, should be used in 
     support of infrastructure projects in countries of sub-
     Saharan Africa.
       (4) Emphasis.--The Corporation shall ensure that the funds 
     are used to provide support in particular to women 
     entrepreneurs and to innovative investments that expand 
     opportunities for women and maximize employment opportunities 
     for poor individuals.

     SEC. 204. OVERSEAS PRIVATE INVESTMENT CORPORATION AND EXPORT-
                   IMPORT BANK INITIATIVES.

       (a) Overseas Private Investment Corporation.--
       (1) Advisory committee.--Section 233 of the Foreign 
     Assistance Act of 1961 (22 U.S.C. 2193) is amended by adding 
     at the end the following:
       ``(e) Advisory Committee.--The Board shall take prompt 
     measures to increase the loan, guarantee, and insurance 
     programs, and financial commitments, of the Corporation in 
     sub-Saharan Africa, including through the use of an advisory 
     committee to assist the Board in developing and implementing 
     policies, programs, and financial instruments with respect to 
     sub-Saharan Africa. In addition, the advisory committee shall 
     make recommendations to the Board on how the Corporation can 
     facilitate greater support by the United States for trade and 
     investment with and in sub-Saharan Africa. The advisory 
     committee shall terminate 4 years after the date of the 
     enactment of this subsection.''.
       (2) Reports to the congress.--Within 6 months after the 
     date of the enactment of this Act, and annually for each of 
     the 4 years thereafter, the Board of Directors of the 
     Overseas Private Investment Corporation shall submit to the 
     Congress a report on the steps that the Board has taken to 
     implement section 233(e) of the Foreign Assistance Act of 
     1961 (as added by paragraph (1)) and any recommendations of 
     the advisory board established pursuant to such section.
       (b) Export-Import Bank.--
       (1) Advisory committee for sub-saharan africa.--Section 
     2(b) of the Export-Import Bank Act of 1945 (12 U.S.C. 635(b)) 
     is amended by inserting after paragraph (12) the following:
       ``(13)(A) The Board of Directors of the Bank shall take 
     prompt measures, consistent with the credit standards 
     otherwise required by law, to promote the expansion of the 
     Bank's financial commitments in sub-Saharan Africa under the 
     loan, guarantee, and insurance programs of the Bank.
       ``(B)(i) The Board of Directors shall establish and use an 
     advisory committee to advise the Board of Directors on the 
     development and implementation of policies and programs 
     designed to support the expansion described in subparagraph 
     (A).
       ``(ii) The advisory committee shall make recommendations to 
     the Board of Directors on how the Bank can facilitate greater 
     support by United States commercial banks for trade with sub-
     Saharan Africa.
       ``(iii) The advisory committee shall terminate 4 years 
     after the date of the enactment of this subparagraph.''.
       (2) Reports to the congress.--Within 6 months after the 
     date of the enactment of this Act, and annually for each of 
     the 4 years thereafter, the Board of Directors of the Export-
     Import Bank of the United States shall submit to the Congress 
     a report on the steps that the Board has taken to 
     implement section 2(b)(13)(B) of the Export-Import Bank 
     Act of 1945 (as added by paragraph (1)) and any 
     recommendations of the advisory committee established 
     pursuant to such section.

     SEC. 205. EXPANSION OF THE UNITED STATES AND FOREIGN 
                   COMMERCIAL SERVICE IN SUB-SAHARAN AFRICA.

       (a) Findings.--The Congress makes the following findings:
       (1) The United States and Foreign Commercial Service 
     (hereafter in this section referred to as the ``Commercial 
     Service'') plays an important role in helping United States 
     businesses identify export opportunities and develop reliable 
     sources of information on commercial prospects in foreign 
     countries.
       (2) During the 1980s, the presence of the Commercial 
     Service in sub-Saharan Africa consisted of 14 professionals 
     providing services in eight countries. By early 1997, that 
     presence had been reduced by half to seven, in only four 
     countries.
       (3) Since 1997, the Department of Commerce has slowly begun 
     to increase the presence of the Commercial Service in sub-
     Saharan Africa, adding five full-time officers to established 
     posts.
       (4) Although the Commercial Service Officers in these 
     countries have regional responsibilities, this kind of 
     coverage does not adequately service the needs of United 
     States businesses attempting to do business in sub-Saharan 
     Africa.
       (5) The Congress has, on several occasions, encouraged the 
     Commercial Service to focus its resources and efforts in 
     countries or regions in Europe or Asia to promote greater 
     United States export activity in those markets.
       (6) Because market information is not widely available in 
     many sub-Saharan African countries, the presence of 
     additional Commercial Service Officers and resources can play 
     a significant role in assisting United States businesses in 
     markets in those countries.
       (b) Appointments.--Subject to the availability of 
     appropriations, by not later than December 31, 2000, the 
     Secretary of Commerce, acting through the Assistant Secretary 
     of Commerce and Director General of the United States and 
     Foreign Commercial Service, shall take steps to ensure that--
       (1) at least 20 full-time Commercial Service employees are 
     stationed in sub-Saharan Africa; and
       (2) full-time Commercial Service employees are stationed in 
     not less than ten different sub-Saharan African countries.
       (c) Commercial Service Initiative for Sub-Saharan Africa.--
     In order to encourage the export of United States goods and 
     services to sub-Saharan African countries, the Commercial 
     Service shall make a special effort to--
       (1) identify United States goods and services which are not 
     being exported to sub-Saharan African countries but which are 
     being exported to those countries by competitor nations;
       (2) identify, where appropriate, trade barriers and 
     noncompetitive actions, including violations of intellectual 
     property rights, that are preventing or hindering sales of 
     United States goods and services to, or the operation of 
     United States companies in, sub-Saharan Africa;
       (3) present, periodically, a list of the goods and services 
     identified under paragraph (1), and any trade barriers or 
     noncompetitive actions identified under paragraph (2), to 
     appropriate authorities in sub-Saharan African countries with 
     a view to securing increased market access for United States 
     exporters of goods and services;
       (4) facilitate the entrance by United States businesses 
     into the markets identified under paragraphs (1) and (2); and
       (5) monitor and evaluate the results of efforts to increase 
     the sales of goods and services in such markets.
       (d) Reports to Congress.--Not later than one year after the 
     date of the enactment of this Act, and each year thereafter 
     for five years, the Secretary of Commerce, in consultation 
     with the Secretary of State, shall report to the Congress on 
     actions taken to carry out subsections (b) and (c). Each 
     report shall specify--
       (1) in what countries full-time Commercial Service Officers 
     are stationed, and the number of such officers placed in each 
     such country;
       (2) the effectiveness of the presence of the additional 
     Commercial Service Officers in increasing United States 
     exports to sub-Saharan African countries; and
       (3) the specific actions taken by Commercial Service 
     Officers, both in sub-Saharan African countries and in the 
     United States, to carry out subsection (c), including 
     identifying a list of targeted export sectors and countries.

     SEC. 206. DONATION OF AIR TRAFFIC CONTROL EQUIPMENT TO 
                   ELIGIBLE SUB-SAHARAN AFRICAN COUNTRIES.

       It is the sense of the Congress that, to the extent 
     appropriate, the United States Government should make every 
     effort to donate to governments of sub-Saharan African 
     countries (determined to be eligible under section 4 of this 
     Act) air traffic control equipment that is no longer in use, 
     including appropriate related reimbursable technical 
     assistance.
                                  ____


 African Growth and Opportunity Act (AGOA)--Section-by-Section Summary

       Policy. The AGOA establishes as U.S. policy the creation of 
     a transition path from development assistance to economic 
     self-reliance for those sub-Sahara countries committed to 
     economic and political reform, market incentives and private 
     sector growth. Eligibility requirements are established for 
     participation in the programs and benefits of the bill. The 
     bill will not require any cuts or increases in the USAID 
     budget. The bill includes separate Trade and Foreign Policy 
     Titles.
       Free Trade Area. The AGOA directs the President to develop 
     a plan for trade agreements to establish a U.S.-Sub Sahara 
     Africa Free Trade Area to provide an incentive for increasing 
     trade between the U.S. and Africa and to stimulate private 
     sector development in the region.
       Trade Initiative. The AGOA would eliminate quotas on 
     textiles and apparel from Kenya and Mauritius after these 
     countries adopt a visa system to guard against transshipment. 
     It continues the existing no-quota policy in Africa through 
     2005. Further, it authorizes the President to grant duty-free 
     treatment for certain products from Africa currently excluded 
     from the GSP program, subject to an import sensitivity 
     analysis by the ITC, and extends the GSP program for Africa 
     for 10 years.
       U.S.-Africa Economic Forum. The AGOA would establish a 
     U.S.-Africa Economic Forum to facilitate annual high level 
     discussions of bilateral and multilateral trade and 
     investment policies and initiatives. The Forum would work 
     with the private sector to develop a long term trade and 
     investment agenda.
       Equity and Investment Funds. The AGOA directs OPIC to 
     create a privately-funded $150 million equity fund and 
     privately-funded $500

[[Page S2954]]

     Million infrastructure fund for Africa. Both funds would 
     support innovative investment policies to expand 
     opportunities for women and to maximize employment 
     opportunities for the poor.
       Greater Attention to Africa. The AGOA calls for at least 
     one member of the board of directors of the EX-IM Bank and 
     the OPIC to have extensive private sector experience in 
     Africa. Both the Bank and OPIC would establish private sector 
     advisory committees with experience in Africa and both would 
     report periodically to the Congress on their loan, guarantee 
     and insurance programs in Africa.

 Mr. McCAIN. Mr. President, I rise today to support legislation 
introduced by my esteemed colleague, Senator Lugar. The African Growth 
and Opportunity Act will create an historic new U.S. trade and 
investment policy for Africa.
  It is regrettable that the public perception of Sub-Saharan Africa 
remains a region which is underdeveloped, poor, ravaged by famine and 
wars, and ruled by authoritarian leaders. This is not an accurate 
picture of today's Africa.
  The Africa of the late 1990s is a continent struggling on the road to 
economic and political reform. Some 30 Sub-Saharan African countries 
are implementing economic reforms, including liberalizing trade and 
investment regimes, rationalizing tariff and exchange rates, and 
reducing barriers to investment and stock market development. In 
addition, more than 30 Sub-Saharan African countries are also in 
various stages of democratic transformation that will allow their 
citizens to have the same type of participation in their governments 
that, as Americans, we hold dear. Nigeria's recent election, despite 
its flaws, is a concrete example of the movement toward democracy in 
Africa.
  The African Growth and Opportunity Act is an important piece of 
legislation designed to promote continued reform in Africa. The main 
strength of the bill is its reliance on trade incentives, not financial 
aid. These trade incentives are intended to result in the political and 
economic well-being of African citizens. American companies are given 
incentives to invest in these countries, and help them learn how to 
become members of the world marketplace. For many years, we have poured 
our financial resources into foreign aid programs that have met with 
limited success. This bill is based on the commonsense principle that 
if you give a nation a handout, you feed it for a day, but if you teach 
it to grow and trade, you assist it to reach permanent independence and 
self-reliance.
  There is also a benefit for the United States in this legislation. 
Currently, United States' exports to Sub-Saharan Africa are $6 billion, 
which support 100,000 American jobs. However, the U.S. has only a 7% 
share in the African market, while Europe has a 40% share. More U.S. 
trade and investment in Sub-Saharan Africa will increase U.S. market 
share, and create more jobs here in the U.S.
  More important, it should be pointed out that this legislation will 
foster interdependence and economic growth between countries that have 
been torn apart by war, disease, and harmful economic policies. By 
trading with the United States and each other, these nations will see 
the benefits of peace and stability to economic growth. An 
interdependent and democratic Africa will be less likely to suffer from 
civil strife.
  I hope that my colleagues will join us in supporting this legislation 
that will open up a new chapter in U.S.-African relations.
                                 ______