Congressman Blake Moore Introduces Legislation to Modernize the Generalized System of Preferences and Decrease Reliance on Chinese Supply Chains
WASHINGTON - Today, Representatives Blake Moore (R-UT) and Suzan DelBene (D-WA) introduced the CNL Update Act of 2023 to modernize U.S. trade policy tools, benefit American businesses, and drive global supply chains out of China.
For almost 50 years, the Generalized System of Preferences ("GSP") program has allowed the United States to foster better trade relationships with the world's most developing countries and reduce their reliance on foreign aid. More recently, the GSP has been a critical tool to move production out of China and into more secure environments. However, the current, outdated rules limit the GSP's potential and create roadblocks for our trade and foreign policy goals.
The CNL Update Act of 2023 will modernize the GSP program by increasing the topline threshold levels for businesses to $600 million, which are known as Competitive Need Limitations ("CNLs"). In addition, the bill introduces a 5% annual growth provision for the GSP program, offering a structured and predictable growth trajectory. These changes will make it easier for Utah companies to access key products, strategically shift global value chains outside China, enhance U.S. national security, and protect domestic industries.
The House Ways and Means Committee held a September hearing on GSP modernization at which Utah-based Black Diamond Equipment testified that higher CNL thresholds will provide them the confidence to set up permanent supply chains for their products outside of China.
“Several economic sectors in Utah, including the outdoor recreation industry, rely on an effective and modernized Generalized System of Preferences program to do business,” said Congressman Blake Moore. “But Congress has not considered a significant overhaul of CNLs in the GSP program since 1996, which has led to outdated trade policies that impede production, limit growth, and harm U.S. economic and national security interests. This legislation will give Utah companies the flexibility they need to diversify their supply chains away from China and towards more reliable trade partners around the world.”
“Trade is a foundational part of Washington’s economy and supports over 40% of jobs in our state,” said Congresswoman Suzan DelBene. “The GSP program supports many American industries and helps spread our values abroad. However, aspects of the program are outdated. The legislation we’re introducing today would modernize the program, helping create more jobs at home, strengthen American leadership abroad, and reduce our dependency on China.”
The bill text can be found HERE.
A one-page explainer can be found HERE.
“World Trade Center Utah appreciates the leadership of Congressman Moore for crafting a finely-tuned improvement to the GSP program.? This bill both benefits Utah manufacturers and furthers important strategic alliances in the world.” - Jonathan Freedman, President and CEO, World Trade Center Utah.
"BioUtah is pleased to support?the efforts of?Rep.?Moore?in introducing the?bipartisan?CNL?Update Act to?modernize?the Generalized System of Preferences’?competitive need limitation?rules.?Utah has a robust life sciences industry with a global reach. Importantly, the legislation would reduce over dependency on China and support small businesses in expanding access to critical overseas supply chain resources." -?Kelvyn Cullimore, President and CEO, BioUtah
"Duty-free benefits under the Generalized System of Preferences (GSP) have saved outdoor companies hundreds of millions of dollars and supported the creation of new U.S. jobs and the development of innovative outdoor products. The CNL Update Act provides common sense reforms and certainty for outdoor companies to continue to diversify away from China and, at the same time, helps developing countries such as the Philippines and Indonesia grow their economies. We applaud Rep. Moore and Rep. DelBene for their leadership and support for the outdoor industry. We renew our call for Congress to pass the CNL Update Act and a long-term renewal of GSP without delay." - Kent Ebersole, President, Outdoor Industry Association. ?
“The RV industry applauds Representatives Moore and DelBene for introducing commonsense reforms that will not only help domestic manufacturers continue to utilize the program to obtain products unavailable in the US, but also further the goals of the program in supporting beneficiary countries. These reforms would ensure that the RV industry can continue our partnership with Indonesia, where we source lauan plywood— a key component used in many RVs— duty free. Removing and reforming the arbitrary Competitive Need Limitations will reduce costs and regulatory burdens on the American RV industry and other domestic industries that rely on the Generalized System of Preferences.” - Craig Kirby, President and CEO, RV Industry Association
"The last few years have illuminated the need for the U.S. to diversify its supply chains—from raw materials to manufactured goods—and to reduce or eliminate?imports from problematic countries like China and Russia. ?Congressman Blake Moore’s CNL Update Act of 2023 will help to modernize and expand our nation’s trading relationships, benefit domestic industries, and increase our economic and national security.” - Brian Somers, President, Utah Mining Association
“We applaud Congressman Moore and Congresswoman DelBene for their leadership in modernizing the outdated competitive needs limitations under the GSP program. The current thresholds have resulted in products being needlessly removed, often before beneficiary countries are able to develop competitive industries – the very goal of the program. The CNL Update Act of 2023 will substantially enhance the GSP program, along with our efforts to build our supply chains in friendly countries.” - Fred Ferguson, Vice President of Public Affairs and Communications for Vista Outdoor
“Fixing the outdated competitive need limitation (CNL) rules is critical to GSP’s goal of supporting economic development opportunities in partner countries, while also supporting jobs at family-owned businesses through the United States. We applaud Representatives Blake Moore and Suzan DelBene for their leadership on updating this critical aspect of the program as part of GSP reauthorization.” - Christine Boldt, Executive Vice President of the Association of Floral Importers of Florida
“For years, CNLs have undermined GSP’s effectiveness as a tool to promote development, lower costs for American manufacturers and families, and help companies diversify supply chains into beneficiary countries. The CNL Update Act’s bipartisan, commonsense changes will improve the GSP program, and we look forward to working with Representatives Moore, DelBene, and others to ensure its inclusion in any GSP renewal bill.” - Dan Anthony, Executive Director of the Coalition for GSP
The CNL Update Act of 2023 has received support from many stakeholder organizations, including:
Utah-based associations
- Utah Manufacturers Association
- Utah Mining Association
- Park City Chamber of Commerce
- Salt Lake Chamber
- World Trade Center Utah
- BioUtah
- Utah Aerospace and Defense Association
National Associations
- Outdoor Industry Association
- RV Industry Association