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Reminder: GSP Eligibility for Some Thailand Products Now Revoked

Tuesday, April 28, 2020
Sandler, Travis & Rosenberg Trade Report

Effective April 25, Generalized System of Preferences eligibility was revoked for approximately one-third of eligible products from Thailand based on that country’s failure to adequately provide internationally-recognized worker rights. The Office of the U.S. Trade Representative has said that the list of affected products, totaling nearly 600 goods with a trade value of about $1.3 billion, is focused on those for which the U.S. is a relatively important market for Thailand but Thailand accounts for a relatively small share of U.S. imports. 

Earlier this month more than a dozen U.S. trade groups asked President Trump to delay this revocation for at least six months, stating that it would “increase costs for American employers already struggling to maintain employment levels in response to shutdowns and falling demand around the world.” The groups said GSP users who receive funds under the federal government’s Paycheck Protection Program may have to divert those funds from worker salaries to tariff costs if the revocation takes effect, in which case the government “could end up paying the newly imposed tariffs itself through the PPP.” The groups added that the GSP revocation could directly undermine efforts to combat the COVID-19 pandemic because it would increase tariffs on goods such as parts for hospital laundry equipment, single-use footwear covers, pumps, compression materials, and plastic resins and other components used to make medical equipment.

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