GSP Travel Goods Decision Draws Criticism

The administration’s annual review of the products subject to duty-free treatment under the General System of Preferences (GSP) program has sparked criticism for the narrow parameters underlying additions to the program. Announced by the Office of the United States Trade Representative on June 30, the review’s findings limit new duty-free status for travel goods only to those originating from Least Developed Beneficiary Developing Countries (LDBDCs) and African Growth and Opportunity Act (AGOA) countries despite public calls for other GSP-beneficiary developing countries to be included.

The American Apparel & Footwear Association (AAFA) notes that while travel goods—including luggage, backpacks, handbags and wallets—from LDBDCs and AGOA countries are able to enter the U.S. duty free effective July 1, the administration delayed indefinitely a decision on granting travel goods benefits to all other GSP beneficiaries. AAFA notes that during the GSP’s public review process, the U.S. government heard overwhelming support for adding travel goods to the GSP program and urged the administration to approve the addition of all travel goods for all GSP countries.

“We are deeply disappointed with President Obama’s decision,” says AAFA President and CEO Rick Helfenbein. “If President Obama had granted benefits to travel goods from all GSP-eligible countries, we estimate the industry would have received benefits that could exceed $75 million during the first year alone. These benefits translate into jobs for our U.S. workers, value for our U.S. customers, and improvements for our global supply chains. The potential for that opportunity is now delayed indefinitely.”

On June 29, President Obama signed the Trade Preferences Extension Act into law, which renewed and updated the U.S. General System of Preferences (GSP) program. The program, which PPAI joined AAFA in supporting, allows duty-free access to the U.S. market by products from developing and least-developed countries in order to facilitate global competition and to improve consumer choice in the U.S.

PPAI Director of Public Affairs Anne Stone says, "PPAI is firmly committed to working with our coalition partners, including the American Apparel and Footwear Association, to ensure favorable duty treatment is made available to all appropriate product categories."

filed under industry-news | july-2016
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