Ways and Means to Hold Hearing on Trade Preference Programs

November 12, 2009

The House Ways and Means Trade Subcommittee has announced that it will hold a hearing on November 17, 2009, to evaluate the operation and impact of the U.S. preference programs to date, as well as opportunities for improvement moving forward. These programs include the Generalized System of Preferences, Andean Trade Promotion and Drug Eradication Act, the he African Growth and Opportunity Act and other programs that provide unilateral market access to developing countries.

While preference programs have been an integral part of U.S. international development strategy for decades, many in Congress believe these programs are in need of a comprehensive overhaul. One concern is that relatively few countries and products dominate preference programs, in particular the regional programs. As a result, stakeholders have argued that Congress should closely examine factors such as product coverage, rules of origin, the frequency of program expiration and the linkages between the programs and trade capacity-building assistance to see whether improvements can be made to improve utilization and diversification.

However, despite the stated interest in preference reform of many congressional leaders, an overhaul is unlikely to pass Congress this year. As the programs are set to expire on December 31, Congress is expected to pass a short term extension this year and work on reform next year.