Statement by Assistant
to the President for Press Relations Fitzwater on Amendments to the Generalized
System of Preferences
January 29, 1988
of their remarkable advancements in economic development and their recent
improvements in trade competitiveness, President Reagan today has decided to
remove four participants from the trade preference program that permits certain
imports from developing economies to enter the United States duty free. Effective January
the Republic of Korea, Singapore, and Taiwan will be graduated from
the Generalized System of Preferences (GSP), a move that will affect nearly $10
billion in imports.
its inception in 1976, the Generalized System of Preferences has been a program
of temporary incentives rather than permanent tariff advantages. Through the
years we have regularly reviewed the 3,000 products from 141 beneficiaries that
are eligible for GSP treatment and removed benefits from those products that no
longer needed preferential treatment to compete in the U.S. market. Today's action
is in keeping with the original intent of the program and with its operation
during the past 12 years.
the past decade, Hong Kong, the Republic of Korea, Singapore, and Taiwan have made such
tremendous strides in their economic development that they can now compete
effectively in the United States without preferential
treatment. Indeed, they have successfully fulfilled the objectives of the
program. Last year nearly 60 percent of GSP benefits went to these four
beneficiaries, a disproportionate amount for such advanced economies. Their
graduation will open additional opportunities for the remaining beneficiaries
-- those most in need of the program.
move should not be interpreted as penalizing any of the beneficiaries being
graduated from the program. On the contrary, it reflects the great economic
successes they have had. All four are good friends and valued trading partners.
But the Generalized System of Preferences is a development program, and when
GSP beneficiaries no longer need the program benefits, they should be
graduated. America's relationship with
these four advanced developing economies has entered a new phase, one that is
characterized by greater equality. The United States admires their economic
achievements and their advancement toward full partnership in the international
trading system. We look forward to continued friendship and even closer
economic ties in the years ahead.