The amount of apparel that can be shipped duty-free from Haiti to the United States over the next year is to fall by 10.3%.

Under the Haitian Hemispheric Opportunity Through Partnership for Encouragement (HOPE) Act, 337,967,087 square metres equivalent (SME) of apparel articles assembled in Haiti will be eligible for preferential treatment from 20 December 2020 through to 19 December 2021. This compares with 376,935,586 SME the year before.

Apparel articles in excess of this amount will be subject to otherwise applicable tariffs.

The quantitative limitation for duty-free treatment is an amount equivalent to 1.25% of the aggregate SME of all apparel articles imported into the United States in the most recent 12-month period for which data are available.

US apparel imports have been hit hard by the Covid-19 pandemic, with demand slumping as retailers closed shops and cancelled or postponed orders. According to the latest figures from the Department of Commerce's Office of Textiles and Apparel (OTEXA), the volume of US apparel imports from all sources was down 18% in the year ending October 2020.

HOPE provides for duty-free treatment for certain apparel articles imported directly from Haiti. To qualify for such treatment apparel articles must be wholly assembled or knit-to-shape in Haiti from any combination of fabrics, fabric components, components knit-to-shape, and yarns.

However, the sum of the cost or value of materials produced in Haiti or one or more countries described in HOPE, or any combination thereof, plus the direct costs of processing operations performed in Haiti or one or more specified countries, or any combination thereof, may not be less than an applicable percentage of the declared customs value of such apparel articles.

The applicable percentage for the period 20 December 2020 through 19 December 2021 is 60%.

The limitation has been implemented under the Caribbean Basin Economic Recovery Act (CBERA), as amended by the HOPE Act.