Turkey’s GSP Eligibility Under Review

Policy Impacts Rates

The public is reminded that trade relations and international policy, have some relevant impact on currency exchange rates within the borders of the United States, but may find different rates in another country.  Rates may begin to return if resolutions are made.

A notice of public hearing and an invite for public comments was published in the Federal Register today by the The United States Trade Representative (USTR)

On August 3 of 2018, The USTR announced, in response to a concern raised by the President; a review into Turkey’s eligibility for the Generealized System of Preferences (GSP) program.  The program is one of the most senior programs that hoped to develop international trade between countries of the world including those with emerging or developing economies.  The program is essential as it to provides for duty-free imports from countries, that certain specified criteria are met.  Turkey is under review for its compliance with the equal market access criteria.  The USTR has mentioned that Turkey applied 1.78 billion dollars worth of tariffs, imposed only on imports from the United States.  In 2017, articles of the categories subject to GSP imports were 17.7% of imports from Turkey, being around 1.66 billion dollars worth of imports from Turkey.  To learn more about the international economic development program, its stated goals, it’s 120 beneficiary countries, a list of eligible articles for import from beneficiary countries that can be under GSP treatment, and how it supports American Jobs or Values, checkout the program’s website.

Separately, the Department of Commerce is engaged in an administrative review into countervailing duties on Welded Carbon Steel Pipe and Tubing, from Turkey.

The President on August 10, 2018 had commented on twitter regarding deteriorating relations with Turkey and claimed to authorize tariffs of amounts of 20% on Aluminum and 50% on Steel.

At the time of this articles public release, their is no notice from the International Trade Administration, United States Trade Representative, or the Department of Commerce; officially defining subjected articles, instruction for assessing duties, or notice of actions enacting the President’s proposed tariffs on entities from Turkey, except for the tube and pipe earlier mentioned and USTR review.

Significance

International policy has an examinable impact on Currency rates.  Most recently, Qatar saw it’s currency temporarily not eligible for trade as businesses and the public feared the economic and functional impact of airspace and transportation difficulties with bordering countries arrising from a dispute with OPEC.

The Euro had lost some value after the United Kingdom had announced it’s exit from the European Union, it’s obligations and special trade agreements and benefits entitled.

These tariffs on raw materials will make imports more expensive and create opportunity for domestic suppliers to be more competitive, but may not make a decisive choice preferring domestic producers.

It is important that the United States government defend and maintain the sustainability of its beneficiary agreements.  If a member beneficiary begins to trade unfairly or acts to disregard beneficiary agreement; it is important the United States protect its right to respect, and fair trade practices.  The GSP may still be a source of opportunity, but at this time interested parties should be patient as representatives from Turkey and the United States further solutions to issue.

Citizens are reminded that for all of the beneficial United States programs which act to promote and sustain peace and prosperity in respect to the United States international affairs may go unnoticed or misunderstood.

Entrepreneurs should standby to see what regulations or actions are taken on imports from Turkey and the subject articles the actions are taken on.  Deterioration of foreign relations and Tariffs may create difficulty for entrepreneurs.  The GSP program may still be a source of opportunity, but trade with Turkey is not clearly defined at this moment as more reactions to the President’s tweet surface, and as government organizations review and act to review President’s recommendations.

A seperate post is coming soon to examine opportunity with GSP program.

Disclaimer

THIS IS NOT LEGAL OR INVESTMENT ADVICE.  THIS IS COMMENTARY ON REGULATION.

We start from modest beginnings but continue to identify, develop, and research opportunity and strategy for entrepreneurs, to better develop business ideas.

At the time of this articles release I do not hold any investments in currency now and do not plan to.

 

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