Apparel industry groups have joined more than 284 companies and trade associations calling for an extension to the US Generalized System of Preferences (GSP) duty-free programme.
Without the passage of legislation extending the GSP scheme, it will expire on 31 December 2020.
The programme provides duty-free treatment for imports of thousands of products from more than 100 developing nations. Without its renewal, these goods will be subject to US tariffs from 1 January 2021.
While the GSP excludes most textile and apparel products exported to the US, the groups say it supports American manufacturing by reducing costs of imported inputs, machinery and equipment, and lowers the costs of beneficiary consumer goods. The continuing economic impact of Covid-19 makes timely GSP renewal even more important, they add.
“Temporary lapses in the past have forced companies to lay off workers, freeze new hires, cut wages and benefits, and delay capital investments while awaiting congressional reauthorization. We cannot afford for that to happen again.”
Signatories include the American Apparel & Footwear Association (AAFA), the US Fashion Industry Association (USFIA), the National Retail Federation (NRF), and the Outdoor Industry Association (OIA).
One of the reasons for the delay in extending GSP is that some stakeholders wish to make changes to the GSP programme as part of a renewal bill – including linking eligibility requirements to reflect human rights actions, adding or removing beneficiary countries, and altering the list of covered products.
The possible inclusion of apparel, textile and footwear products in the US GSP programme is one potential move that has already garnered opposition from the US textile industry.
“However, substantive changes to GSP cannot receive the careful consideration they deserve in the four weeks before the current authorisation lapses,” says the most recent letter to congressional leaders.
David Olave, attorney at international trade law firm Sandler, Travis and Rosenberg (ST&R), says that even if GSP is renewed this year it will likely be for only a short time, with changes to the programme then likely to be debated and possibly codified in 2021.