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US cuts GSP trade benefits for Thailand

The US Trade Representative (USTR) announced that Washington will eliminate some tariff benefits for Thailand, saying the country has failed to allow imports of pork from US producers.

Olivier Languepin

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The Office of the United States Trade Representative (USTR) announced today that President Trump is suspending $817 million in trade preferences for Thailand under the Generalized System of Preferences (GSP) program based on its lack of sufficient progress providing the United States with equitable and reasonable market access for pork products.

According to a USTR statement, “Despite 12 years of bilateral engagement, Thailand has yet to provide the United States with equitable and reasonable market access for pork products, as outlined in a 2018 petition from the National Pork Producers Council (NPPC) requesting removal of GSP benefits.

 GSP eligibility will be revoked for approximately one-sixth of Thailand’s GSP trade, representing $817 million in U.S. imports under the GSP program in 2019.   The decision is effective on December 30, 2020 and will close the review of Thailand.

But the new GSP suspension will result in Thai products being taxed at a normal rate, not that they will be banned from entering the US, said Keerati Rushchano, director-general of Department of International Trade Promotion.

The list of products to be excluded from GSP for Thailand is focused on products for which the United States is a relatively important market for Thailand but where Thailand accounts for a relatively small share of U.S. imports.  

A full list of the products to be excluded from GSP for Thailand is available here.

Last year Thailand’s total exports to the US amounted to $31.19 billion, comprising products that were under the GSP as well as those that were not. Of the 573 products that will no longer have GSP privilege, Thailand 315 of them represent approximately $1.5 billion.

GSP, the largest and oldest U.S. trade preference program, is designed to promote economic development by allowing duty-free entry into the United States for 3,500 products from 119 designated beneficiary countries and territories.

To remain eligible for these advantages, beneficiary countries must comply with 15 statutory eligibility criteria, including taking steps to afford internationally recognized worker rights, providing adequate and effective protection of intellectual property rights, and assuring equitable and reasonable access to its markets.

Bangkok Correspondent for Siam News Network. Editor at Thailand Business News

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