US increases RP’s GSP quota to $1.1B this year

The US has agreed to increase the country’s Generalized System of Preferences (GSP) allocation to $1.1 billion from the earlier announced $1 billion, Trade and Industry Secretary Manuel Roxas II said yesterday.

The GSP is an annual program that grants tax-free benefits to around 4,400 eligible products from 19 designated beneficiary-countries and territories classified as developing or underdeveloped.

The Philippines exported $11-billion worth of products to the US last year, $1 billion of which was under GSP.

Roxas said the additional $100-million GSP allocation will cover new products such as carrageenan, pineapple juice and a few others.

"A portion of the $100 million additional allocation has already been approved, while the remaining portion still needs approval, " Roxas said.

"The inclusion of carageenan is dependent on confirmation that a US company, FMC, which is also engaged in carageenan production in the Philippines, is no longer harassed," he added.

The GSP list includes electronic apparatus and devices like ignition wiring sets, telephone line sets, reception apparatus and digital watches, raw sugar, metal and wooden furniture, Christmas ornaments and lighting sets, rattan baskets and bags, and baseball gloves.

The Philippines was one of three countries where a review of the GSP expansion was undertaken. The others being Argentina and Turkey.

The US began extending these unilateral, non-reciprocal preferences in 1975 and renewed them in the Trade and Tariff Act of 1984. Lately, however, the US Congress provided for a year-to-year extension of the GSP system coupled with an annual review of the products and country qualifications.