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All Politics is Local; Even Global Trade

On December 31, 2010, the Generalized System of Preferences (GSP) program, in effect for over 35 years, expired. GSP extends duty-free treatment to several thousand products imported into the United States from more than two-thirds of the world's countries. Large and small businesses, including suppliers to the RV industry, import certain products duty-free under GSP.

The expiration of GSP is now causing serious financial burdens for the thousands of American businesses including RV manufacturers that rely on GSP savings to remain competitive. In particular, wholesale prices for imported wood used by RV manufacturers and suppliers have increased as a direct result of the expiration of this trade agreement. Other products used by the industry may be suffering a similar fate. 

Traditionally, GSP has enjoyed strong support and bipartisan legislation extending GSP for 18 months passed the House by voice on December 15, 1010. GSP renewal was widely supported by virtually all members of the House and Senate.

However, renewal ultimately failed in the U.S. Senate because of controversy over its impact on one U.S. producer of one product imported from one GSP country. Specifically, Senator Jeff Sessions (R-AL) blocked the extension of the GSP because he couldn’t get sleeping bags removed from the program. According to the New York Times, he was acting on behalf of Exxel Outdoors, a domestic sleeping-bag maker from Haleyville, Ala., that competes against sleeping bags imported duty-free under GSP from Bangladesh by CellCorp of Bowling Green, Ky. The Republican leader, Mitch McConnell (R-KY), was pushing to pass the GSP in its entirety, so Mr. Sessions put a hold on the bill.

Meanwhile the expiration of GSP is costing American companies including RV manufacturers and suppliers nearly $2 million per day.

RVIA is working with import, supplier, manufacturing and retail groups to pressure Congress to extend the GSP as quickly as possible and retroactive to its expiration on December 31.

Until that happens, the RV industry, along with thousands of other industries will have to pay higher prices for imported products. Unfortunately the outlook for quick action to renew GSP is grim. Senator Sessions has signaled an unwillingness to remove his hold and it is unclear at this time whether or when GSP will be renewed.

What you can do

RVIA has joined 130 companies and 16 national and regional associations that have signed on to the GSP Supporter List. To sign your company onto the supporter list, go to  http://renewgsptoday.com/

RVIA will also be working with OEMs and suppliers to draft letters to key Members of Congress supporting extension of GSP.




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