Last week, USA Rice provided virtual testimony to the U.S. International Trade Commission (USITC) in support of removing rice from the list of eligible commodities under the Generalized System of Preferences (GSP). The U.S. has long provided GSP benefits to developing countries, providing duty-free access for thousands of imports to help grow their economies.
Most developing countries are eligible for duty-free access for parboiled rice only, however all rice from the “least developed countries” like Cambodia and Myanmar, is eligible for duty-free access into the U.S.
With the percentage of overall rice imports growing, U.S.-grown rice has become an increasingly import-sensitive commodity. USA Rice submitted a petition to the Office of the U.S. Trade Representative (USTR) in March advocating for the removal of rice from the list of GSP-eligible commodities and the petition has since moved forward into the formal review process, including a concurrent analysis by the USITC.
USA Rice is also participating in an ongoing virtual hearing with the USTR on this topic that is expected to last throughout the summer.
“We acknowledge that [the de facto] duties for rice are not import-prohibiting, but they would certainly help make U.S.-grown rice more competitive and put our product on closer-to-equal footing,” the petition said.
“U.S. rice continues to face adversity in export markets where the domestic industries claim import-sensitivity and use tariffs and non-tariff barriers to entry … It is time to acknowledge that U.S.-grown rice is also import-sensitive and therefore we respectfully request the removal of GSP benefits for rice imports,” it continued.
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The GSP program is set to expire December 31, 2020, unless it’s reauthorized by Congress. When USTR Ambassador Lighthizer testified before the House Ways and Means Committee last week, he was asked if he supported reauthorizing GSP, to which he responded that the Administration had “not formally taken a position” on renewal.
He added, “I would point out one thing that has come to my attention recently that I found rather annoying … and that is there are countries that get GSP [benefits] from us … that have free trade agreements with, for example, Europe, and give Europe better trade benefits than we do.”
Rice grower organizations representing the six major rice-growing states signed a joint letter with their corresponding state farm bureau organizations lending their support to the USA Rice petition.
USTR is expected to make a final determination regarding USA Rice’s petition by early fall.