White House releases annual GSP evaluation

White House releases annual GSP evaluation    The Obama administration has determined that a handful of imported products from three countries will lose their duty-free status under the Generalized System of Preferences program because they are sufficiently competitive in the United States.
   Those imports include certain passenger tires from Thailand, wood flooring from Brazil, and gold rope necklaces from India.
   Each year, the White House conducts a review of the products and countries benefiting from GSP. Congress created the program in the 1974 Trade Act to help developing countries expand their economies by allowing certain goods to be imported to the United States duty-free.
   'In our annual review, USTR worked to make sure GSP is working as it should, assessing GSP beneficiaries' development, export competitiveness, and domestic policy practices,' said U.S. Trade Representative Ron Kirk, in a statement on Wednesday. 'A well-functioning GSP program can help developing countries grow their export industries while providing U.S. businesses the inputs and products they need to keep good jobs here at home.'
   The administration decided to continue duty free treatment for fresh cut carnations from Colombia and silver jewelry from Thailand. Finally, the president decided to continue to provide duty-free treatment to 110 products from 19 beneficiary countries, because imports exceeded the statutory ceilings by only a small amount. In 2009, the total value of imports of these 110 products was $613 million.
   The administration also granted Egypt's request to add frozen beans and frozen mixed vegetables to the list of eligible products. Those products will become eligible for duty-free benefits under the GSP program on July 1.
   As part of this year's review, the Office of the U.S. Trade Representative analyzed petitions to withdraw or limit a country's GSP benefits on criteria including whether a country is taking steps to afford internationally recognized standards for worker rights, whether it provides important investor protections including enforcement of arbitral awards, and the extent to which a country adequately and effectively protects intellectual property rights (IPR).
   As part of the 2009 review, USTR accepted petitions to review whether Sri Lanka met GSP eligibility criteria related to worker rights and whether Argentina met the criteria related to enforcement of arbitral awards. Several countries remain under review of whether they meet eligibility criteria. Those countries are Lebanon, Russia and Uzbekistan regarding IPR protection, and Bangladesh, Niger, the Philippines and Uzbekistan regarding worker rights.
   Under the GSP program, 131 beneficiary developing countries, including 43 least-developed countries such as Afghanistan, Bangladesh, and Cambodia, are eligible to export about 5,000 types of products duty-free to the United States.
   In 2009, the USTR noted that the United States extended duty-free treatment under the GSP program to exports worth $20.3 billion from eligible beneficiary countries. Exports to the United States under GSP constituted a significant share of total exports from a number of beneficiary countries, including Paraguay, Lebanon, Tunisia, Fiji and Armenia.
   The GSP statute includes two competitive need limitations (CNLs) on the eligibility of a product for benefits under GSP:
   ' If the annual trade of a product from a specific country exceeds a value-based threshold ($140 million in 2009).
   ' If the annual trade of a product from a specific country exceeds 50 percent of total U.S. imports of that product.
   The statute also authorizes the president to waive the application of these limitations if certain conditions are met. Any CNL waiver granted remains in effect until the president determines that the waiver is no longer warranted due to changed circumstances.
   The statute provides that the president should revoke any existing CNL waiver that has been in effect for five years or more if a GSP-eligible product from a specific country has an annual trade level in the previous calendar year that exceeds 150 percent of the value-based threshold or 75 percent of all U.S. imports of that product.
   USTR said it would also publish further details on the results of the annual review in the Federal Register. ' Chris Gillis