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The Impact of the Caribbean Basin Economic Recovery Act (Nineteenth Report 2007-2008)

Investigation No. 332-227
USITC Publication 4102


The overall effect of the Caribbean Basin Recovery Act (CBERA) on the U.S. economy continues to be negligible while the effect on U.S. consumers and beneficiary countries is small but positive. Imports benefiting from CBERA continued to fall in 2007 and 2008, reports the U.S. International Trade Commission (USITC) in its most recent report monitoring imports under the program.

The USITC, an independent, nonpartisan, factfinding federal agency, recently issued its 19th report in a series monitoring imports under the CBERA. The CBERA program, operative since January 1, 1984, affords preferential tariff treatment to most products of designated Caribbean, Central American, and South American countries, 19 of which were CBERA beneficiaries for all of 2008.

The USITC found:

  • Imports under the CBERA continued to fall from their peak of $12.3 billion in 2005, reaching $4.7 billion in 2008. Imports under the program declined in 2008 from 2007 in all leading product categories – energy products, agricultural products, textiles and apparel products, and other mining and manufacturing products.

  • Imports under CBERA also declined from 2007 to 2008 because the Dominican Republic (one of the largest sources of imports under the CBERA in past years) was a CBERA beneficiary country for only two months of 2007 before leaving the CBERA when it implemented the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR).

  • Of the $4.7 billion in U.S. imports that were entered under the CBERA in 2008, imports valued at $4.1 billion could not have received tariff preferences under any other program.

  • The Commission’s analysis of recent investment trends for the near-term production and export of CBERA-eligible products shows that investment is not likely to result in imports that would have a measurable economic impact on U.S. consumers and producers, as CBERA countries generally are small suppliers relative to the U.S. market, and investment activity in CBERA countries continued to focus on export-oriented services such as tourism, financial, and telecommunications services. Services imports are not covered by the CBERA.

  • The CBERA has had small positive effects on Caribbean exports, but those effects have largely been concentrated in a few countries and focused on a few products.

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