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Myanmar may regain GSP

The US may restore trade benefits to Myanmar that had been suspended more than two decades ago amid rights abuses. The aim is that Myanmar should be able to benefit from preferential tariffs for poor countries under the Generalized System of Preferences scheme.

Myanmar’s GSP eligibility was suspended in April 1989 due to concerns about labor abuses. The country has been seeking to regain the trade benefits since 2013, the same year it gained GSP status from the European Union.

However not all sanctions will be scrapped.

GSP is the largest and the oldest US trade preference program. The status will grant Myanmar tax privileges on exports to the world’s largest economy and in turn fuel foreign investment into the industrial sector. The GSP status could bolster investor interest in the garment sector.

But it is unclear which sectors the special tariff preferences would be applied to and whether the fledgling garment sector would be included.

Trade between Myanmar and the United States is still minimal. Myanmar’s total bilateral trade for the 2015-16 fiscal year to November came to about 17.1 billion dollars. Bilateral trade between Myanmar and the US for the first six months of 2016 came to 238 million dollars.