President Bush says this country no longer needs special treatment.
By: Juhel Browne (Express).
T&T TOO RICH
I have determined that Trinidad and Tobago has become a "high income" country, and I am terminating the designation of that country as a beneficiary developing country ...effective January 1, 2010.
Trinidad and Tobago's economy has been going so well that US President George W Bush has informed Congress this country is now a "high income" one and therefore no longer qualifies for duty-free access for exports.
Unfortunately for local exporters, however, the "high income" designation comes with a downside to them, as Bush has issued a presidential proclamation that terminates this country's preferential treatment under the Generalised System of Preferences (GSP) to export a range of products duty-free into the American markets, in the next two years.
According to the Office of the United States Trade Representative, the GSP is a programme designed to promote "economic growth" in the developing world and provides preferential duty-free access for the entry of more than 4,500 products from 131 designated beneficiary countries and territories.
The GSP was created in 1974 by the United States Congress, which is comprised of the House of Representatives and the Senate.
It came into force in 1976.
And while Minister in the Ministry of Finance Mariano Browne says the new development will only affect about "two per cent" of the country's exports, he acknowledged it is something that the Government is not ignoring.
"It's not threatening to business. It's something to look at," Browne said in an interview with the Express yesterday.
The GSP beneficiary status is determined by the United States President in accordance with the rules of the International Bank for Reconstruction and Development under the United States Trade Act of 1974.
On Monday, Bush wrote a letter to the United States House of Representatives Speaker Nancy Peloski and Senate President Richard Dick Cheney, who is also the United States Vice President, in which he informed them of his proclamation that terminates the designation of Trinidad and Tobago as a beneficiary developing country for purposes of the GSP, according to the rules of the International Bank for Reconstruction and Development.
"Termination is effective on January 1, of the second year following the year in which such determination is made. I have determined that Trinidad and Tobago has become a 'high income' country, and I am terminating the designation of that country as a beneficiary developing country for purposes of the GSP, effective January 1, 2010," Bush wrote.
The letter is available on website of the United States presidential office, The White House.
Interviewed during the tea break of yesterday's sitting of the Senate, Browne said that he had consulted with Trade and Industry Minister Dr Lenny Saith, who informed him that the situation is not a doom-and-gloom pronouncement for the nation's export sector.
"It only affects two per cent of our total trade," Browne said.
Asked if this would not affect many local exporters, he responded, "Two per cent? Some people will be, but we can't say exactly. That is what we estimate at this stage of the game."
He said Bush's determination that this country should now be designated in the high-income bracket is "not surprising" given the overall performance of the economy.
In a statement issued yesterday, Nirad Tewarie, a spokesman Congress of the People (COP), expressed serious concerns about Bush's decision as he claimed it "will have a tremendous impact on local exporters and almost certainly result in a loss of jobs".
