U.S. Ends Duty-Free Status for Thai, Indian, Brazilian Goods

July 1, 2010
The decision was made during an annual review of program created three decades ago to allow certain goods of developing countries to be imported duty free.

The United States has withdrawn duty-free treatment given under a special program to certain passenger tires from Thailand, wood flooring from Brazil and gold rope necklaces from India, the government said Wednesday.

As the products were found to be "sufficiently competitive" in the United States, their duty-free treatment under the Generalized System of Preferences (GSP) program "will be withdrawn," a statement by the US Trade Representative's office said.

The decision was made by President Barack Obama during an annual review of the GSP program, created by the U.S. Congress more than three decades ago to allow certain goods of developing countries to be imported into the U.S. duty-free.

In 2009, the United States extended duty-free treatment under the GSP program to exports worth $20.3 billion from eligible beneficiary countries, government data showed.

Obama also decided to continue duty-free treatment for fresh cut carnations from Colombia and silver jewelry from Thailand, the statement said.

Egypt's request to add frozen beans and frozen mixed vegetables to a list of eligible products was also granted, with the two products to enjoy duty-free benefits on July 1.

In addition, the statement said, President Obama decided to continue providing duty-free treatment to 110 products from 19 beneficiary countries because their imports exceeded the statutory ceilings by only a small amount.

The imports of the 110 products were valued at $613 million last year.

"GSP is central to our trade agenda and critical to developing countries continued growth and development," U.S. Trade Representative (USTR) Ron Kirk said. "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."

He said the GSP program could help developing countries grow their export industries while providing U.S. businesses the inputs and products they needed to "keep good jobs here at home."

As part of this years review, the USTR also analyzed petitions to withdraw or limit countries' GSP benefits based on various criteria, the USTR said.

The criteria included whether they took steps to afford internationally recognized standards for worker rights, provide key investor protections, including enforcement of arbitral awards and protect intellectual property rights.

In 2009, the 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.

Countries that remain under review of whether they meet eligibility criteria are Lebanon, Russia and Uzbekistan regarding intellectual property rights protection, and Bangladesh, Niger, the Philippines and Uzbekistan on worker rights.

Under the GSP program, in total, 131 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.

Copyright Agence France-Presse, 2010

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