Trade Ask Congress to Make Immediate GSP Renewal a Priority
Multiple businesses, trade associations, and business organizations have sent a letter to leadership at the House Ways and Means and Senate Finance Committees asking them to make the immediate renewal of the Generalized System of Preferences a priority.
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GSP for most beneficiary countries, i.e., other than those listed as African Growth and Opportunity Act (AGOA) beneficiary countries, will expire on December 31, 2009, unless a law extending it is enacted.
Signatories to the letter include the National Customs Brokers and Forwarders Association of America, the National Foreign Trade Council, the U.S. Chamber of Commerce, General Electric Company, J.C. Penney Company, and Wal-Mart.
Producers in Developing Countries Rely on Programs Like GSP, Etc.
According to the letter, it is now a very sensitive period for U.S. companies and families that have come to depend on the duty savings granted through preference programs such as GSP, and the producers in developing countries that rely on the programs to support export-related jobs.
U.S. customers must decide whether to continue to use the preference programs to source goods from beneficiary countries, or shift sourcing elsewhere. They must also decide if they need to raise prices to cover duty increases they will incur if GSP is not renewed. Congressional action - or inaction - has an enormous impact on those decisions.
Signatories Say Its Unrealistic to Expect Trade Preference Reform before GSP Deadline
The signatories' letter states that they understand the desire of members of Congress to take a close look at existing U.S. preference programs to ensure they are working, particularly for least-developed countries. Many of their organizations have been actively engaged in that effort and look forward to continuing to work with Congress to improve U.S. preference programs for developing countries and U.S. users alike.
However, it is not realistic to expect that this effort could be completed before GSP expires on December 31, 2009. Therefore, the signatories ask that Congress move GSP renewal early in the fall, while also continuing in earnest the important discussions on preference improvements, with a goal of enacting preference improvement legislation next year.
(Congressional sources recently stated that the House Ways and Means and Senate Finance Committees continue to actively work on a trade preference reform package, which would include GSP (and the other trade preference programs, such as the ATPA/ATPDEA, etc.). The sources added that the committees have not yet decided how it will approach the issue of extending GSP beyond December 31, 2009 if the reform package is not completed in time.)
(GSP is a program designed to promote economic growth in the developing world by providing preferential duty-free entry for approximately 4,800 products from 131 designated beneficiary countries and territories.)
(See ITT's Online Archives or 08/19/09 news, 09081915, for most recent BP summary on GSP being scheduled to expire on December 31st.)
Letter (dated 09/28/09) available at http://www.nftc.org/default/Trade%20Policy/Trade_Preference_Programs/GSP_Letter_to_Congress.pdf
BP Note
The Andean Trade Preference Act/Andean Trade Promotion and Drug Eradication Act (ATPA/ATPDEA) is scheduled to expire on December 31, 2009 (for Colombia, Peru, and Ecuador). Congressional sources added that the committees have not yet decided how it will approach the issue of extending ATPA/ATPDEA beyond December 31, 2009 if the reform package is not completed in time.