T&T too rich for US trade deal

Published: Wednesday July 2, 2008

The US has graduated T&T from a preferential trade programme called the Generalised System of Preferences (GSP) because this country has grown too rich to qualify for the programme.

In a June 30 letter to the Speaker of the US House of Representatives and President of the US Senate, President George W Bush said he was terminating T&T’s designation as a beneficiary developing country under the GSP.

The GSP is a programme designed to promote economic growth in the developing world and provides preferential duty-free entry for more than 4,650 products from 131 designated beneficiary countries and territories.

Bush said he was cutting T&T from the programme because this country had become a “high income” country according to World Bank statistics.

Bush cited Section 502(f) of the Trade Act of 1974.

He added: “Section 502(e) of the 1974 Act, provides that the President shall terminate the designation of a country as a beneficiary developing country for purposes of the GSP if the President determines that such country has become a ‘high income’ country as defined by the official statistics of the International Bank for Reconstruction and Development” (World Bank).

“I have determined that Trinidad and Tobago has become a ‘high income’ country, and I am terminating the designation of that country as a beneficiary developing country for purposes of the GSP, effective January 1, 2010.”

Jwala Rambarran, an economist and managing director of CAP-M Research, yesterday said once a country has graduated from low-to middle-income, it will no longer be eligible for certain benefits, particularly in respect to aid, or for some typical preferencial facilities from the World Bank and the International Monetary Fund.

According to the Central Bank, T&T’s gross domestic product (GDP) per capita is US$16,105.

“In the last three to four years, our GDP has grown so rapidly, our per capita might rank third or fourth in the Western Hemisphere,” Rambarran said.

“We have a vibrant energy sector that people come and invest in. We have more or less moved away from aid flows. They are no longer as important to T&T as a form of financing.”


Source: Trinidad Guardian Newspapers
http://www.guardian.co.tt/business3.html