Industry Presses Progress on Overdue GSP Renewal

April 15, 2024 | WASHINGTON, D.C.

The American Apparel & Footwear Association expressed its support for renewal of the Generalized System of Preferences (GSP), applauding the GSP Reform Act introduced today.

"Special thank you to Representative Adrian Smith for introduction of this important bill. The apparel and footwear industry encourages Congress to quickly pass the GSP Reform Act," said Steve Lamar, president and CEO of the American Apparel & Footwear Association. "GSP has always had bipartisan support, and the record long lapse has been unexplainable and damaging to American businesses, American workers, and beneficiary countries alike, all while handing a huge trade win to China. This retroactive renewal is far more effective at making our trusted partners more competitive than misapplied tariffs will ever be. This GSP program is also helpful to mitigate the costs faced by our nation's supply chains during this time of continuous disruption. Once renewed, this can have a very real impact on the cost and offering of everyday goods such as luggage for summer travel and backpacks for school in the fall."

"We were pleased to see several proposed reforms, including measures to update the competitive need limitation (CNL) mechanism and open a process to consider currently ineligible products. Such reforms are vital if GSP is to be properly equipped to help companies invest in supply chains as they diversify from China," said Beth Hughes, AAFA vice president, trade and customs policy.

The GSP is the largest and oldest U.S. trade preference program. It is designed to support economic development in select developing countries by removing tariff barriers on qualifying products, while supporting worker rights, intellectual property protection, and the rule of law in these beneficiary countries. Historically, the GSP program has garnered bipartisan and bicameral support since its inception in 1974 as the program requires Congressional re-authorization. The refunding of tariffs collected during prior gaps in the program's operation has been common in previous renewal bills.

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