Publication Number: 3447

Report Title: The Impact of the Caribbean Basin Economic Recovery Act: 15th Report, 1999-2000

Investigation Number: 332-227

Author's name(s): Thomas Jennings, Diane Manifold

Date Published: September 2001

Report Description/Introductory Text: USITC economic assessment of the Caribbean Basin Economic Recovery Act, CBERA, and the Caribbean Basin Trade Preference Act, CBTPA. The USITC report assesses economic effects of CBERA and CBTPA related trade and investment on the U.S. economy, U.S. industries, and consumers. The report also assesses the probable future economic effect of CBERA and CBTPA trade and investment on the United States, as well as the impact of CBERA on the Caribbean basin countries.

In this report, the U.S. International Trade Commission (USITC) assesses the actual economic impact and the probable future effects of the Caribbean Basin Economic Recovery Act (CBERA), as amended by the Caribbean Basin Trade Partnership Act (CBTPA), on the U.S. economy generally, and on U.S. industries and consumers, and the impact of the program on the economies of the beneficiary countries. The actual impact of CBERA on the United States in 2000 is estimated using partial equilibrium analysis. The probable future effect of CBERA on the United States is estimated by an examination of CBERA-eligible investment in the beneficiary countries. The impact of the preference program on beneficiary countries was examined by means of an econometric analysis. The report also includes a comprehensive review of U.S. trade with Central America and the Caribbean in 1999-2000.

The overall effect of CBERA-exclusive imports (those ineligible for other tariff preferences) on the U.S. economy and consumers continued to be negligible in 2000. The USITC did not identify any U.S. industries that would face potentially significant negative effects from CBERA-exclusive imports. U.S. imports of the 20 leading CBERA-exclusive items, except two sugar subheadings, produced net welfare gains for U.S. consumers in 2000. The probable future effect of CBERA on the United States is also expected to be minimal in most sectors. However, in one sector, textiles and apparel, the probable future effect is likely not to be insignificant, following the CBTPA inclusion of certain apparel articles as eligible for preferential treatment. CBERA appears to have had a small but positive effect on the income growth of beneficiary countries, and no significant effect on overall investment in the region.

USITC prepared this report in accordance with section 215 of the CBERA

Topics Covered: USITC economic assessment, USITC economic effect, Caribbean, trade preference, CBERA, CBTPA, CBI

Countries: United States

HTS Numbers: 0804, 1701, 2402, 2709, 2710, 2905, 6107, 6108, 6109, 6110, 6115, 6203, 6204, 6205, 6212, 7113

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