House passes GSP, Andean trade support bill

House passes GSP, Andean trade support bill The U.S. House of Representatives on Monday approved by unanimous consent legislation to extend trade preferences for developing countries.
   The bill renews the Generalized System of Preferences and the Andean Trade Preferences Act for one year, while tweaking the program targeted at helping imports from African countries and creating a new textile and apparel program to benefit domestic textile producers and apparel producers in the Dominican Republic.
   Without congressional action both programs would expire at the end of the year.
   The 32-year-old GSP program removes or lowers duties for a large number of products from developing countries. The Andean Trade Preferences Act provides duty-free treatment to certain imports from Colombia, Peru, Ecuador and Bolivia.
   Last week, the U.S. Trade Representative said it would move to suspend unilateral trade benefits for Bolivia under ATPA and the Andean Trade Promotion and Drug Eradication Act because of that country’s recent inability to sustain counternarcotics efforts. The agency plans to seek public comment and hold a hearing on the matter.
   The Bolivian government recently expelled U.S. Agency for International Development personnel and removed U.S. Drug Enforcement Administration officials from primary cocoa producing areas. U.S. officials are also upset that cocoa production has increased and that the government has failed to close illegal cocoa markets and suggested it might sanction some cocoa production.
      The legislation updates the African Growth and Opportunity Act (AGOA) by removing a requirement that restricts least-developed countries from purchasing textiles in a third country if the assembling nation has an “abundant supply” of material. The provision was intended to encourage vertical integration of the textile industry in Africa, but has actually created uncertainty for AGOA apparel producers and U.S. retailers, resulting in lost jobs, trade and investment in African countries, according to a statement from the House Ways and Means Committee.
   The House also reinstated Mauritius’ eligibility to use the program’s “third-country fabric” provisions. The designation lapsed in 2005, causing a dramatic decline in apparel exports to the United States as many garment factories shut down and moved to Asia, the Committee said.
   The trade bill, H.R. 7222, also establishes a “two-for-one” textile and apparel allowance program allowing Dominican Republic producers that purchase U.S. fabric to receive a 50 percent credit that can be used to ship the corresponding quantity of eligible pants/bottom apparel to the United States duty-free regardless of the origin of the actual fabric in the product.
   The removal of Bolivia from the program could increase the chances for support in the Senate, where some lawmakers have expressed concern about the political situation in Bolivia. Some senators may also insist that a trade preference bill for Pakistan and Afghanistan be included in the bill, according to WorldTrade Interactive, a newsletter produced by international trade law and lobbying firm Sandler, Travis & Rosenberg. ' Eric Kulisch