USTR to Assess GSP Eligibility of Beneficiary Countries

The Generalized System of Preferences (GSP) is a U.S. trade program designed to promote economic growth in the developing world by providing preferential duty-free entry for up to 5,000 products to designated states and territories. GSP is not a trade agreement, but rather a benefit offered to less economically developed countries, allowing these countries to increase and diversify their trade with the United States.

The U.S. Trade Representative (USTR) has announced a new effort to ensure beneficiary countries are meeting the eligibility criteria of GSP. The process will involve an assessment by USTR and other relevant agencies of each GSP beneficiary country’s compliance with the statutory eligibility criteria. If the assessment raises concerns regarding compliance, the Administration may initiate a full country review of that country’s continued eligibility for GSP. During the assessment, there will be ample opportunities for engagement between the government of the beneficiary country and the U.S. Government. Cambodia became a GSP beneficiary in 1997 and in 2016 exported nearly $179 million duty free to the United States under the program.

To qualify for GSP benefits, a beneficiary country must meet the eligibility criteria established by Congress, including, but not limited to: enforcing arbitral awards; a beneficiary may not have nationalized, expropriated or otherwise seized property of U.S. citizens or corporations without providing, or taking steps to provide effective compensation; taking steps to afford internationally recognized worker rights; implementing commitments to eliminate the worst forms of child labor; and the extent to which a country provides adequate and effective protection of intellectual property rights.

Under the GSP program, certain products from 120 beneficiary developing countries and territories can enter the United States duty-free. In 2016, the total value of imports that entered the United States under GSP was $18.9 billion. For more information on the GSP program, visit the GSP page on the USTR website.