Friday, December 28, 2012

U.S. Trade Rep. Ron Kirk on Changes to Preference Programs for Dev. Nations

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Presidential Proclamation Makes South Sudan Eligible to Receive Benefits, Addresses Eligibility of Other Countries under AGOA and GSP

Washington, D.C. — United States Trade Representative Ron Kirk commented today on important changes to two of the United States’ key trade preference programs – the African Growth and Opportunity Act (AGOA) and the Generalized System of Preferences (GSP). Trade preference programs are designed to enhance the economic growth of developing countries through increased access to the U.S. market.

The attached proclamation, signed by President Obama today, designates the Republic of South Sudan as eligible for AGOA benefits, which means that South Sudan can now take advantage of duty-free access to the U.S. market for certain products. This important step for South Sudan follows a similar action in March of this year, which designated the Republic of South Sudan as a GSP beneficiary country. Additionally, Congress passed legislation signed by President Obama in August which added South Sudan as a sub-Saharan African nation that could be considered for AGOA eligibility once it met the criteria.

“In the face of many challenges, South Sudan has made measurable progress since becoming an independent nation in July 2011,” said Ambassador Kirk. “President Obama’s designation of South Sudan as an AGOA-eligible country will help support its continued economic growth through increased trade and investment – which is a proven tool for sustained development.”

While extending AGOA benefits to South Sudan, following an annual review of all countries’ eligibility, the President has also determined that the Republic of Guinea-Bissau and the Republic of Mali shall not be eligible to receive AGOA benefits in 2013. Each of these countries suffered a coup d’├ętat in 2012 and the consequent political instability, human rights abuses, and corruption led to these decisions.

Among other actions, the proclamation also terminates St. Kitts and Nevis from eligibility under the Generalized System of Preferences because it has become a high-income country as defined by the World Bank. The termination will become effective January 1, 2014. St. Kitts and Nevis will remain eligible for trade preferences under the Caribbean Basin Economic Recovery Act (CBERA).

Background on U.S. Trade Preference Programs Congress created the GSP program in the Trade Act of 1974 to help developing countries expand their economies by allowing certain goods to be imported to the United States duty-free. Under the GSP program, 127 beneficiary developing countries, including 44 least-developed countries, are eligible to export up to 5,000 types of products to the United States duty-free. In 2011, the total value of imports that entered the United States duty-free under GSP was $18.5 billion. For more information on the GSP program, please visit the GSP page of USTR’s website.

AGOA was established in 2000 to provide eligible sub-Saharan African countries with duty-free access for a broader variety of products than is available under GSP, including apparel, footwear, and some agricultural and processed food products. For more information on AGOA, visit the USTR’s website here.

The CBERA program, established in 1983, allows duty-free entry into the United States for about 5,501 products from beneficiary countries, including almost all products covered under the GSP program. More information on the CBERA program can be found here.

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