Biden Revokes Ethiopia Trade Preferences As Tigray War Intensifies

President Joe Biden on Tuesday booted Ethiopia from a vital trade pact due to rights concerns as the historic US ally declared a state of emergency over rebel advances north of the capital.

Frustrated after repeated warnings to Prime Minister Abiy Ahmed about suffering in the nearly year-old war, the Biden administration said it was removing Ethiopia, as well as coup-hit Guinea and Mali, from the African Growth and Opportunity Act (AGOA).

In a notice to Congress, Biden said that Ethiopia's eligibility would end on January 1 over "gross violations of internationally recognized human rights."

AGOA, a landmark 2000 law credited with boosting industry in sub-Saharan Africa, removed US duties on most exports if countries adhere to good governance.

The Tigray war has generated accounts of massacres, mass rapes and widespread hunger in what US Secretary of State Antony Blinken has described as "acts of ethnic cleansing."

Jeffrey Feltman, the US special envoy for the Horn of Africa, said Thursday there could no longer be "business as usual" with Ethiopia's government which he accused of intentionally hindering humanitarian aid.

"No government can tolerate an armed insurgency -- we get that -- but no government should be adopting policies or allowing practices that result in mass starvation of its own citizens," Feltman said at the US Institute of Peace.

Ethiopia, which in recent weeks has lobbied to stay in AGOA, said it was "extremely disappointed" by the decision.

"These actions will reverse significant economic gains in our country and unfairly impact and harm women and children," a trade ministry statement said.

Ethiopia's exports to the United States have risen from $28 million in 2000 to nearly $300 million in 2020, with almost half the goods falling under AGOA, according to Abiy's government.

Abiy, who won the Nobel Peace Prize in 2019, launched the military campaign in November 2020 after attacks on the federal army by the Tigray People's Liberation Front (TPLF).

The rebels in recent days have claimed control of two key cities and have not ruled out marching on Addis Ababa.

Authorities ordered residents of the capital to register their firearms as state-affiliated media announced a nationwide state of emergency.

Feltman, the US envoy, said Washington had directly warned TPLF leaders not to advance on the capital and instead to pursue talks.

He voiced exasperation at allegations in Addis Ababa that the United States is seeking to overthrow Abiy and install a government along the lines of late strongman Meles Zenawi, a former TPLF chairman.

"That is just not true," Feltman said.

But Cameron Hudson, a former US official now at the Atlantic Council, questioned the timing of the long-expected AGOA decision just as rebels advanced.

It "could end up looking like regime change depending on how things play out," he tweeted.

Under the TPLF-led governing coalition that preceded Abiy, Ethiopia sought to create a national network of industrial parks, with AGOA's tax benefits giving a major advantage over manufacturing hubs outside of Africa.

Zemedeneh Negatu, chairman of the US-based Fairfax Africa Fund, warned that even temporary removal from AGOA would have long-term effects with investors leaving.

"What we're trying to tell the US government is that it's not like an on-off light switch," he told a roundtable with business leaders in Addis Ababa in September.

"The young women who work in the industries become permanently unemployed," he said.

Netsanet Sidamo, a supervisor for a garment manufacturer at the industrial park in Hawassa, in southern Ethiopia, told AFP she receives 4,000 Ethiopian birr per month (roughly $85) -- money that has helped her pay rent, support her family and pursue a university degree.

"If the company stops its operations, not only me but thousands of my colleagues will not have anywhere to go," she said.

"People can talk about many issues in this country, but what I can say is this has been beneficial for me and I hope others can be beneficiaries of this opportunity so they can change their lives."

TPLF leaders call it hypocritical for Abiy's government to appeal for continued support under AGOA when the war has severely damaged industrial infrastructure in Tigray.