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Sudan Tribune

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US adds South Sudan to a preferential trade program

March 26, 2012 (WASHINGTON) – The United States President Barack Obama on Monday announced that his administration is adding the newly independent country of South Sudan to the list of countries that would be eligible to enjoy preferential treatment in exporting a wide range of goods to the US.

U.S. President Barack Obama (Reuters)
U.S. President Barack Obama (Reuters)
“I have determined that the Republic of South Sudan should be designated as a beneficiary developing country under the GSP (Generalized System of Preferences)” said the statement on the White House website.

According to the Office of US Trade representative, the GSP is a program designed to promote economic growth in the developing world by providing preferential duty-free entry for up to 4,800 products from 129 designated beneficiary countries and territories.

South Sudan became an independent state last July and the US was one of the first countries to recognise it. Washington was the main broker in Sudan’s north-south peace agreement that gave southerners the right of self-determination.

Even though it is an oil-rich country, South Sudan is considered one of the poorest nations on earth as two decades civil war, that officially ended in 2005, left it effectively having to build the country from scratch.

The US Trade Representative, Ron Kirk, urged the South Sudan to use the GSP program “to continue needed economic reforms.”

“The President’s designation of the Republic of South Sudan as a GSP beneficiary country provides an opportunity for this newly independent nation to use trade to boost its economic development and, we hope, will encourage it to continue needed economic reforms” Kirk said.

“The President’s action is also an important step toward consideration of South Sudan’s eligibility for trade benefits under the African Growth and Opportunity Act (AGOA). We look forward to working with Congress on near-term passage of legislation extending AGOA’s third-country fabric provision, which is crucial for continued success of the program” he added.

Oil is the largest import under both the GSP program and a separate US program known as AGOA (African Growth and Opportunity Act) that South Sudan also aspires to join.

Andrea Mead, a spokeswoman for Kirk’s office, told Reuters South Sudan’s oil reserves “were not a factor” in the administration’s consideration of trade benefits for the country.

“We want to help strengthen the economy of this new nation and help its government bring jobs and greater prosperity to the South Sudanese people,” Mead added.

Senior congressional Democrats welcomed Obama’s decision to add South Sudan to the GSP, and called for action on a bill to add the country to the AGOA program and renew a textile provision of the AGOA legislation set to expire soon.

“African producers tell us that, due largely to uncertainty about this provision’s renewal, importers began to shift their orders out of Africa during the second half of 2011,” said Democratic Representative Charles Rangel.

“I will continue to push my Republican colleagues to pass the non-controversial bill renewing the third-country fabric provision and adding South Sudan as a possible AGOA beneficiary as soon as possible,” he said.