US cuts GSP on 11 Thai products
THE United States has cut the Generalised System of Preferences (GSP) granted to 11 types of Thai products, in response to their export volumes exceeding the limited value or their market share in the country, The Thai Ministry of Commerce said yesterday.
Based on the US announcement of its Annual GSP Product Review for 2017 on Tuesday, the cut in GSP will appy to 15 countries: Argentina, Belize, Bosnia, Brazil, Ecuador, Egypt, Falkland, Indonesia, Kazakhstan, Pakistan, the Philippines, Suriname, Turkey, India to Thailand.
Adul Chotinisakorn, director-general of the Department of Foreign Trade, said that GSP on these Thai products or about 1.11 per cent of Thailand's GSP claim were cut due to their excessive exports of over US$180 million in value or a market share of 50 per cent for each product, in line with the Competitive Need Limit (CNLs) defined by the US. The GSP cut took effect from yesterday (Nov 1).
These products range from fresh orchid, fresh Durian, dried papaya, dried tamarind, flavoured corn, fruit and nuts preserved by sugar, processed papaya, wood flooring, printer, washing machine and camera stand.
In 2017, the US granted GSP for over 3,400 types of Thai products worth a total of $4.15 billion. Thailand’s claim of GSP privileges stood at 69.98 per cent.
GSP is a US trade programme designed to promote economic growth in the developing world by providing preferential duty-free entry for products from designated beneficiary countries and territories.
Thailand's 10 products registered market shares of over 50 per cent in the US market and one product – washing machine, booked its value of import to the US at more than $180 million.
From January to August of this year, all of the 11 Thai products claimed the GSP privileges of approximately $28.8 million or 14.3 per cent. Without the GSP privileges, these products will be taxed at normal rates of 1-8 per cent.
Thailand can send a request for the GSP redesignation during the US annual GSP product review, while the US defines that import of such products must be valued lower $185 million per year and share less than 50 per cent. If a product's market share is more than 50 per cent, there must not be production of such product in the US and the US industries must not be affected.
