NCBFAA Urges Long-Term Renewal, Caution in Addressing GSP

Washington, DC: In a letter today to the Office of U.S. Trade Representative, Federico Zuniga, President of the National Customs Brokers and Forwarders Association of America, Inc. (NCBFAA) urged the "timely and long-term renewal of GSP [Generalized System of Preferences] program." GSP is a U.S. program that grants duty-free treatment, on a product-by-product basis, to developing countries and is intended to help developing nations start selling to U.S. markets.
        In calling for a long-term renewal of the program, the NCBFAA President explained: "The most recent renewal of GSP in 2001 for a period of more than 5 years was a welcome change from the short, sporadic and uncertain renewals in the decade preceding the 2001 renewal. Although we understand the procedural and bureaucratic reasons for this situation, the short renewals were very damaging to many U.S. businesses and counterproductive to the goals of the GSP program."
        President Zuniga called the "timely and long-term renewal" of the program the "single most important point as the expiration of GSP approaches at the end of next year."
        The Federal Register notice asked for specific comment on whether the operation of the GSP should be modified to enable beneficiaries that have not previously been major traders under the program to increase their participation and whether some beneficiaries are sufficiently competitive with respect to trade in eligible products that they should no longer be designated as GSP beneficiaries. NCBFAA expressed concern that "any significant changes to the program will create an environment of controversy that will delay renewal of the program."
        The NCBFAA letter also cautioned the Administration not to assume that, by graduating the larger GSP beneficiary nations, the smaller countries will benefit. President Zuniga explained, "In a very competitive, global marketplace, if a country loses its GSP eligibility, US companies will seek an alternative supplier who can provide reliable service at the lowest cost. Since the least developed GSP countries often lack the production capability as well as the infrastructure, China may very well become the alternative supplier. Not only would this diminish the effectiveness of GSP, it would exacerbate the gaping trade deficit with China."
        Headquartered in Washington, DC, the NCBFAA represents nearly 800 member companies with 100,000 employees in international trade - the nation's leading freight forwarders, customs brokers, ocean transportation intermediaries (OTIs), NVOCCs and air cargo agents, serving more than 250,000 importers and exporters. Established in 1897 in New York, NCBFAA is the effective national voice of the industry. Through its various committees, counsel and representatives, the Association maintains a close watch over legislative and regulatory issues that affect its members. It keeps them informed of these and other related issues through its weekly Monday Morning eBriefing, NCBFAA Quarterly Bulletin, and various meetings and conferences throughout the year.