Bill H.R. 6406 includes Abundant Supply provisions

Rep. Bill Thomas
US Senator
Publication Date
01 May 2006

Summary of AGOA and GSP-related provisions of this Bill. Generalized System of Preferences (GSP) 1. Extends GSP for two years, consistent with the President’s budget request. 2. After a six-month delay, tightens rules on competitive need limit waivers to tailor the program for use by lesser developed countries that need help exporting to the United States.President is given discretion to end waivers on products that constitute 150 percent of the competitive need limit or 75 percent of U.S. imports of that product. African Growth and Opportunity Act (AGOA) 1. Extends current provision allowing benefits for apparel made with fabric from third countries until 2012, with a 3.5 percent cap. 2. Provides an exception to the third country fabric benefit for apparel goods made from components that are in “abundant supply” in Africa. The purpose is to remove current disincentives for the investment in fabric production in Africa. In particular, denim is deemed to be in abundant supply because of known production in Lesotho. 3. Allows duty free treatment for lesser developed countries for certain textiles (non-apparel) of wholly made African fabric.

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