US embassy cable - 04ABUJA961

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SENSITIVE BUT UNCLASSIFIED, NOT FOR PUBLICATION ON THE 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. 
 
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TEXTILE VISA STILL A MAJOR ISSUE 
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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. 
 
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MULTILATERAL EFFECTS IN AFRICA AND THE WTO 
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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