AAFA Applauds GSP Travel Goods Decision

June 29, 2017 | WASHINGTON, D.C.

The American Apparel & Footwear Association applauds the decision by President Trump to extend duty-free treatment to imports of all statutorily-eligible travel goods (including luggage, handbags, backpacks, tote bags, etc.) from all eligible countries under the Generalized System of Preferences (GSP) program. The change will go into effect on July 1, 2017.

This decision follows the move by the Obama Administration in January, to defer a final decision to expand duty-free treatment beyond ‘least-developed beneficiary countries’ and African Growth and Opportunity Act (AGOA) countries to the then incoming Trump Administration. The Obama Administration originally approved duty-free treatment for all travel goods from ‘least-developed beneficiary countries’ and AGOA countries on June 30, 2016.

"Today’s announcement is a welcome move that will provide major benefits to U.S. companies, U.S. workers, and U.S. consumers," said Rick Helfenbein, president and CEO of AAFA. "AAFA has long supported efforts to include travel goods under the GSP program, and while last year’s decision by the Obama Administration was an important adjustment, it did not go far enough, and did not meet the original intent that Congress had targeted for this important GSP initiative.

"Today, the industry pays in excess of $90 million a year on duties, which can now be re-purposed towards well-paying jobs for U.S. workers, lower costs for U.S. consumers, and/or increased investments in product innovation. Additionally, this move will encourage diversification of the supply chain into developing economies, including the Philippines, Thailand, Pakistan, Indonesia, and Sri Lanka.

"This is the result of hard work by many individuals. Credit goes to the leadership of the Senate Finance Committee and House Ways and Means Committee, especially Senator Hatch and Chairman Brady. We also express our gratitude to Senators Ayotte, Blunt, Cantwell, Merkley, Roberts, Shaheen, and Wyden, and Representatives Blumenauer, Bonamici, Crenshaw, Kind, Lowey, Paulsen, Polis, Reichert, Renacci, Smith, and Tiberi for their leadership throughout this process. Finally, we thank President Trump, Ambassador Lighthizer, and other officials of the Administration for issuing this proclamation that has bipartisan, bicameral support, and that will have a major positive impact on U.S. businesses, U.S. workers, and U.S. consumers.

"Now we encourage Congress to move forward with the renewal of GSP before its expiration at the end of the year, and to approve legislation that would make select footwear eligible for GSP benefits going forward."

AAFA led a coalition of more than two dozen organizations advocating before Congress and the Administration to provide duty-free treatment for all statutorily-eligible travel goods from all GSP-eligible countries. AAFA presented testimony to USTR on October 18, 2016, urging the office to expand duty-free treatment to all GSP-eligible countries. AAFA also organized an industry letter to President Trump in support of this change to the GSP in March 2017.