This week, September 10, the United States (US) House of Representatives’ Ways and Means Committee will hold a hearing to consider the renewal of the Caribbean Basin Trade Partnership Act (CBTPA) which expires at the end of this month, that is, September 30, 2020.
The CBTPA, which took effect on October 5, 2000, is one of the constituent pieces of legislation of the Caribbean Basin Initiative providing beneficiary Caribbean countries with duty-free access to the US market for a wide range of goods.
The CBTPA provides expanded preferences for originating goods from Caribbean beneficiary countries beyond what is included in the Caribbean Basin Economic Recovery Act (CBERA). For example, it provides duty-free and quota-free (DFQF) treatment for apparel assembled in CBI countries from US fabrics formed from US yarns and cut in the US. It also provides a ‘regional fabric’ benefit by providing DFQF treatment for
certain knit apparel made in CBTPA beneficiary countries from fabrics formed in the Caribbean Basin region once that the fabric is formed from US yarns.
Moreover, it provides ‘NAFTA-parity’, that is, tariff treatment equivalent to that extended to Mexican goods under the North American Free Trade Agreement (NAFTA) (replaced by the US-Mexico-Canada Agreement – USMCA), for certain goods that were not included for duty-free treatment under the CBERA.
Only a subset of CBERA beneficiaries are eligible for the enhanced benefits under the CBTPA. Several defined political, legal and other criteria restrict the US President in which Caribbean countries or territories could be designated as CBTPA eligible. According to the Thirteenth Report to Congress on the Operation of the Caribbean Basin Economic Recovery Act, the current CBTPA-eligible countries and territories are Barbados, Belize, Curacao, Guyana, Haiti, Jamaica, St. Lucia and Trinidad & Tobago.
The CBTPA has been renewed by Congress several times. A further CBTPA renewal will ensure that those exporters in the Caribbean which rely on this preferential access to the US market will continue to do so. According to the Thirteenth Report to Congress on the Operation of the Caribbean Basin Economic Recovery Act, the US imported $US 344.4 million in goods under the CBTPA in 2018, a 0.2% increase from in 2017. Total US imports under the entire CBI programme were $US 1,031.3 million in 2018, while total US imports from CBI countries (including non-CBI programme imports) were US$6,020.1 million that same year.
The hearing on the CBTPA renewal will be held remotely and can be watched via live stream on September 10 here.
Alicia Nicholls, B.Sc., M.Sc., LL.B is an international trade and development specialist. Read more of her commentaries here or follow her on Twitter @licylaw. All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may from time to time be affiliated.