You are here

Statement by USTR Ron Kirk On Need to Extend Trade Programs that Support American Jobs

12/22/2010

Washington, D.C. -- U.S. Trade Representative Ron Kirk issued the following statement on Congressional action today on three trade-related programs: the Generalized System of Preferences (GSP), the Andean Trade Preference Act (ATPA) and Trade Adjustment Assistance (TAA):

Ambassador Kirk said, “I am disappointed that Congress adjourned without fully extending three trade programs that support American jobs and increase U.S. competitiveness. While the extension of Trade Adjustment Assistance and the Andean Trade Preference Act is important and will allow these programs to continue for an additional six weeks, these programs require a long-term extension to ensure that they operate as intended." He continued, “The exclusion of the Generalized System of Preferences from the package means that this important program will lapse on December 31, hurting American consumers and businesses as well as workers and farmers in many of the world’s poorer countries. The Obama Administration will continue to work with Congress in an effort to secure a full, long-term reauthorization of these three essential trade programs.”

BACKGROUND:

U.S. businesses and consumers benefit from the GSP program through cost savings on imports. Also, according to a 2005 U.S. Chamber of Commerce study, the program supports over 80,000 American jobs associated with moving GSP imports from the docks to farmers, manufacturers and ultimately to retail shelves. U.S. imports under GSP exceeded $20 billion in 2009 and are on pace to exceed $27 billion in 2010. GSP saved U.S. importers nearly $577 million in duties in 2009. The program was instituted on January 1, 1976, by the Trade Act of 1974. In addition to its benefits to American families, GSP is designed to promote economic growth in the developing world by providing preferential duty-free entry for about 4,800 products from 131 designated beneficiary countries and territories.

Coca, the raw material for cocaine, is grown exclusively in the Andean region of South America. The U.S. International Trade Commission has found that the ATPA continues to have a positive effect on drug-crop eradication and crop substitution, as well as job growth in export-oriented industries, in the Andean region. The objectives of the ATPA, enacted in 1991, are to promote broad-based economic development, diversification of exports, and consolidation of democracy and to help defeat the scourge of drug trafficking by providing sustainable economic alternatives to drug-crop production in beneficiary countries. Colombia, Ecuador, and Peru are currently receiving benefits under the program. In 2009, the United States imported about $9.7 billion in goods under the ATPA program. Colombia, which accounted for 57.5 percent of U.S. imports under ATPA in 2009, has been a particularly staunch ally in the fight against coca production and narcotrafficking. It is currently suffering from severe flooding. A loss of duty-free treatment represents a further negative impact on Colombian producers of various commodities.

TAA renewal will ensure continued support for American workers, firms, and communities impacted negatively by trade. The Trade and Globalization Adjustment Assistance Act of 2009 (TGAAA) was signed into law by President Obama as part of the American Recovery and Reinvestment Act of 2009. It expanded TAA coverage to more workers and firms, including those in the service sector. The law expanded benefits to workers whose jobs have been outsourced to foreign countries, improved workers’ training options, made health insurance premiums more affordable for them, and created new benefits for trade-affected communities. The TGAAA also expanded the scope of the TAA programs to better assist adversely affected workers in finding new employment. It authorized funding for employment and case management services. Additionally, the program encouraged the type of long-term training necessary for jobs in the 21st century economy through an extension of income support, an increase in the cap for training funding, and access to training for adversely affected incumbent workers.

##