THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release May 18, 2000
THE TRADE AND DEVELOPMENT ACT OF 2000: STRENGTHENING OUR
ECONOMIC PARTNERSHIP WITH SUB-SAHARAN AFRICA AND THE CARIBBEAN BASIN
May 18, 2000
TODAY, PRESIDENT CLINTON WILL SIGN INTO LAW THE TRADE AND DEVELOPMENT ACT OF 2000. The measure includes the Africa Growth and Opportunity Act (AGOA) and the U.S.-Caribbean Basin Trade Partnership Act (CBTPA) and other important provisions. This package advances U.S. economic and security interests by strengthening our relationship with regions of the world that are making significant strides in terms of economic development and political reform. It will expand two-way trade and create incentives for the countries of sub-Saharan Africa (SSA) and the Caribbean Basin to continue reforming their economies and participate more fully in the benefits of the global economy.
STRENGTHENING OUR PARTNERSHIP WITH AFRICA THROUGH THE AFRICAN GROWTH AND OPPORTUNITY ACT. The 48 nations of sub-Saharan African make up a market of 700 million people that offers enormous commercial potential for U.S. exporters. In 1998, for example, our exports to Africa amounted to more than $6.5 billion -- more than 45 percent greater than those to all the countries of the former Soviet Union combined. Yet, U.S. trade with Africa still represented merely 1 percent of our total trade that year. There is room for our trading relationship to grow and benefit both markets as Africa develops. AGOA will promote reforms in Africa that will leverage efforts to increase investment, expand economic growth, and reduce poverty. Among other provisions, the Act will:
- Expand the Generalized System of Preferences (GSP) program to provide duty-free treatment to virtually all products exported to the U.S. from sub-Saharan Africa. The GSP program provides preferential tariff treatment for imports of developing countries that satisfy certain eligibility requirements.
- Institutionalize a high-level economic dialogue and take initial steps toward consideration of a Free Trade Area.
- Protect African workers and U.S. jobs through the creation of tough safeguards against trans-shipment; i.e., shipping an item through a beneficiary country that was in fact manufactured in a third country so as to gain illegal access to the American market on preferential terms.
- Require that human rights and internationally recognized worker rights be respected.
STRENGTHENING OUR TIES TO THE CARIBBEAN THROUGH THE U.S.-CARIBBEAN BASIN TRADE PARTNERSHIP ACT. The 23 independent countries of the Caribbean Basin region together form the sixth largest export market for U.S. goods, totaling $19 billion and absorbing 2.7 percent of U.S. exports in 1999. But the devastation of Hurricanes Mitch and Georges in 1998 set the regional economy back. To help repair the damage and promote long-term growth, the Act, among other provisions, will:
- Expand the CBI program to extend preferential tariff treatment to textile and apparel products assembled from U.S. fabric that have been excluded from the program. This will encourage additional U.S. exports of cotton and yarn and U.S. investment in the region, improving the global competitive position of the U.S. textile industry.
- Extend preferential tariff treatment to textile handicrafts and all non-textile products currently excluded from such treatment under the existing Caribbean Basin Initiative.
- Conditions countries' eligibility for these expanded trade benefits on fulfillment of WTO obligations, protection of intellectual property rights, cooperation in counter-narcotics efforts, and respect for core labor standards.
THE TRADE AND DEVELOPMENT ACT OF 2000 IS PART OF PRESIDENT CLINTON'S LARGER TRADE AND DEVELOPMENT AGENDA. For too many poor countries, foreign debt obligations, major public health challenges, (especially HIV/AIDS), and illiteracy and inadequate workforce skills impede efforts to reduce poverty and capitalize on opportunities in the global economy. To meet this three-pronged challenge, the President has:
- Debt Relief: Helped lead our G-7 partners to adopt the Cologne Debt Initiative, which will reduce the debts of over 30 of the poorest countries by an estimated 70 percent when combined with previous efforts.
- Infectious Disease: Proposed in his budget this year a $1 billion tax incentive aimed at stimulating the development of vaccines for poor countries, a $50 million contribution to the Global Alliance for Vaccines Initiative, and a $100 million increase in foreign assistance for AIDS prevention and care. He has also appealed to the World Bank and other multilateral development banks to increase low interest loans for infectious diseases by $400 million to $900 million.
- Basic Education/Combating Child Labor: Proposed in his budget this year a 50 percent increase in U.S. assistance for improving access to basic education and combating child labor in developing countries, including $45 million for the International Program to Eliminate Child Labor, and $55 million in new funding for targeted bilateral educational aid to developing countries.