WORLD TRADE
ORGANIZATIONWT/L/288
27 November 1998
(98-4763)
General Council
9 - 11 December 1998Original:  English
UNITED STATES – CARIBBEAN BASIN ECONOMIC RECOVERY ACT
Report of the Government of the United States
under the Decision of 15 November 19951
The following communication, dated 19 November 1998, has been received from the Permanent
Mission of the United States.
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Introduction
On November 15, 1995, the United States was granted a renewal of the waiver (WT/L/104) from
its obligations under paragraph 1 of Article I of the GATT 1994 to the extent necessary to permit the
United States Government to provide duty-free treatment to eligible products of the Caribbean Basin
countries and territories as authorized by the provisions of Caribbean Basin Economic Recovery Act(CBERA) without being required to extend the same duty-free treatment to like products of any other
Member.  This waiver was extended until 31 December 2005.
Under the terms of this waiver, the United States is required to submit to the General Council an
annual report on the implementation of the trade-re lated provisions of th e CBERA with a view to
facilitating the annual review provided for in paragraph 4 of Article IX of the WTO Agreement.  This
report covers calendar year 1998.  Trade data has been provided for calendar year 1997, the most recentyear for which full-year data is available.
Duty-free Treatment under the CBERA
Title II, section 211 of the CBERA allows the Pres ident of the United States to eliminate duties
on all products, with certain exceptions2, from those Caribbean countries and territories that he designates
                                                     
1 WT/L/104.
     2The products excluded from duty-free treatment are:   textile and apparel articles which are subject to
textile agreements;  certain footwear which was not eligible for duty-free entry under the U.S. Generalized System
of Preferences in 1983;  prepared tuna in airtight containers;  petroleum and petroleum products;  watches and watch
parts if such products contain any material  from countries not accorded MFN treatment .WT/L/288
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as beneficiaries.  There are 28 countries or territories eligible for CBERA benefits.  Presently, 24
countries and territories have requested to receive CBERA benefits; all are receiving benefits. These
countries and territories are:   Antigua and Barbuda, Aruba, The Bahamas, Barbados, Belize, British
Virgin Islands, Costa Rica, Dominica, Dominican Rep ublic, El Salvador, Grenada, Guatemala, Guyana,
Haiti, Honduras, Jamaica, Montserrat, Netherlands Antilles, Nicaragua, Panama, St. Christopher-Nevis,St. Lucia, St. Vincent and the Grenadines, and Trinidad and Tobago. There has been no change in the list
of beneficiaries since 1990.
CBI Performance
The CBI program has helped beneficiaries diversify their exports.   On a region-wide basis, this
export diversification has led to a more balanced production and export base and has resulted in a
reduction in the region's vulnerability to fluctuations in markets for traditional products.
Total CBI country exports to the United States, excluding petroleum, have nearly doubled  since
1983, the year prior to the implementation of the CBI, and 1997.   The generally steady rise in U.S. trade
with the CBERA countries and territo ries has mirrored the increase in U.S. trade worldwide.  In 1997,
U.S. imports from CBERA countries accounted for 1.9 percent of total U.S. imports, up from 1.8 percent
in 1996.
U.S. imports from CBERA countries and territories traditionally have consisted of agricultural
products, raw materials, and their derivatives—namely, petroleum products, sugar cane, coffee, cocoa,
bananas, and aluminum ores and concentrates.  The deterioration in the terms of trade for these export
items and a quest for economic growth prompted CBERA countries and territories to seek diversification
in their export profile.  The encouragement of such diversification of the Caribbean Basin economies was
one of the intended goals of the United States in implementing the CBERA program.
Light manufactures, principally apparel, but also footwear, instruments, and jewelry, account for
an increasing share of U.S. imports from the region, and constitute the  fastest growing sectors for new
investment in CBERA countries and territories.  However, traditional agricultural and raw material
products continue to play a significant role in the region’s economies.
While generally not eligible for CBERA tariff pref erences, apparel constitutes one of the fastest
growing categories of imports from the CBERA countri es and territories—growing from just 5.5 percent
of total U.S. imports from the region in 1984, to nearly 46 percent in 1997, valued at almost $7.5 billion.
Apparel has ranked as the leading category of U.S. imports from the region since 1988.
In 1997, the Dominican Republic and Costa Rica continued to lead all countries in taking
advantage of CBERA, as they have done virtually each year since the program became effective.  These
two countries combined have been responsible for mo re than one-half of overall annual U.S. imports
under CBERA since 1989; in 1997, they provided 58.7 percent of the total, up from 56.9 percent of the
total in 1996 .  Guatemala ranked as the third-leading CBERA  beneficiary in 1997, while Honduras was
fourth, and Trinidad and Tobago ranked fifth.
Statistical annexes are provided to present a detailed description of the trade aspects of the CBI
program for the most recent period.  Detailed information for previous years has been provided in
previous reports to the GATT Council or WTO General Council.WT/L/288
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Table 1 provides summary information on U.S. imports for consumption under CBERA provisions
during the period 1995-97.
Table 2  provides information on leading U.S. imports, by product, from CBERA countries during
1996-97.
Table 3  provides information on U.S. trade with CBERA countries during 1984-97.
Table 4  provides summary information on the duty tr eatment of U.S. imports from CBERA countries
during 1984-97.WT/L/288
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Table 1
U.S. imports for consumption under CBERA provisions, by countries, 1995-97
Rank Country 1995 1996 1997
----------------1,000 dollars, customs value--------------
1 Dominican Republic ........................... 845,356 932,413 1,136,523
2 Costa Rica........................................... 527, 715 657,127 746,353
3 Guatemala........................................... 168,46 6 279,768 270,268
4 Honduras............................................. 156,83 9 207,289 263,814
5 Trinidad and Tobago ........................... 144,247 184,895 226,244
6 Nicaragua............................................ 78,54 3 116,007 135,340
7 El Salvador ......................................... 68,550 91,254 81,7998 Panama................................................ 39,35 7 51,352 81,064
9 Jamaica ............................................... 87,329 95,965 74,515
10 Belize.................................................. 16,676  24,760 34,71011 Haiti .................................................... 26,521 30,223 31,194
12 Guyana................................................ 17,40 9 32,285 28,512
13 Bahamas.............................................. 22,85 4 20,765 25,131
14 Barbados ............................................. 23,042 23, 089 24,982
15 St. Kitts and Nevis .............................. 18,776 19,241 24,636
16 St. Lucia.............................................. 6,503 7,129 5,26317 Montserrat........................................... 1,488 3,962 4,679
18 Grenada............................................... 724 1,007 4,070
19 Netherlands Antilles ........................... 4,468 4,357 3,86220 St. Vincent and the Grenadines........... 2,527 3,580 2,373
21 Dominica ............................................ 2,200 2,204 1,556
22 Antigua Barbuda................................. 1,683 1,615 52223 British Virgin Islands.......................... 12 631 26224 Aruba .................................................. 114 138 166
     Total............................................... 2,261 ,407 2,791,055 3,207,842
Note.—Figures may not add to the totals given due to rounding.
Source: U.S. International Trade Commission/ Compiled from official statistics of the U.S. Department of
Commerce.WT/L/288
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Table 2
Leading U.S. imports for consumption from CBERA countries, 1996-97
HTS item Description 1996  1997
---Value (1,000 dollars)---  Pct. Chang e
6203.42.40 Men’s or boys’ trousers, breeches and shorts, not knitted, of cotton 788,479 985,581 25.00
6109.10.00 T-shirts, singlets, tank tops and similar garments, of cotton 604,434 840,116 38.990901.11.00 Coffee, not roasted, not decaffeinated 467,564 760,172 62.580803.00.20 Bananas, fresh or dried 703,235 641,139  -8.832710.00.05 Distillate and residual fuel oils (including blends), testing under 25 degrees API 625,607 524,906 -16.16110.20.20 Sweaters, pullovers, and vests, knitted or crocheted of cotton 346,565 456,889  31.836204.62.40 Women’s or girls’ trousers, breeches and shorts, of cotton 339,420 434,150 27.96205.20.20 Men’s or boys’ shirts, not knitted or crocheted, of cotton 384,304 405,162 5.439801.00.10 U.S. goods returned without having been advanced in value or improved 348,930 367,456  5.311701.11.10 Raw sugar not containing added flavoring or color 330,776 343,135  3.749018.90.80 Medical, surgical, or dental instruments and appliances 327,302 343,111  4.832402.10.80 Cigars, cheroots and cigarillos, each valued 23¢ or over 159,468 341,727  114.296212.10.90 Brassieres, not of lace or silk 293,136 338,975  15.646105.10.00 Men’s or boys’ shirts, knitted or crocheted, of cotton 239,503 313,488  30.890306.13.00 Shrimps and prawns, cooked in shell or uncooked, live, fresh, chilled 273,638 282,857  3.376108.21.00 Women’s or girls’ briefs and panties, knitted or crocheted, of cotton 200,940 282,749 40.716107.11.00 Men’s or boys’ underpants and briefs, knitted or crocheted of cotton 172,685 231,708  34.182814.10.00 Anhydrous ammonia 264,321 229,742  -13.086406.10.65 Footwear uppers, other than formed, of leather 202,006 224,592  11.186203.43.40 Men’s or boys’ trousers, breeches and shorts, not knitted, synthetic fibers 146,157 214,587 46.82
Total of items shown 7,218,470 8,562,245 18.62
Total all commodities 14,544,810 16,572,402 13.94
Note.—Because of rounding, figures may not add to totals shown.
Source: United States International Trade Commission/ Compiled from official statistics of the U.S. Department of Commerce.WT/L/288
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Table 3
U.S. trade with CBERA countries, 1984-97
Share of U.S. Share of U.S.
exports to imports from
Year U.S. exports1the world U.S. imports2the world U.S. trade balance
Million dollars Percent Million dollars Percent Million dollars
1984 ...............     5,952.9 2.8 8,649.2 2.7 -2,696.4
1988 ...............     7,421.8 2.4 6,061.1 1.4 1,360.71992 ............... 10,901.7 2.6 9,425.6 1.8 1,476.11994 ............... 12,822.0 2.7 11,200.3 1.7 1,621.71995 ............... 14,870.3 2.7 12,550.1 1.7 2,320.21996 ...............   15,374.7 2.6 14,544.8 1.8 829.91997 ...............   17,807.9 2.8 16,572.4 1.9 1,235.4
   
1 Domestic exports, f.a.s. basis.
   2 Imports for consumption, customs value.
Note.—For complete data series prior to 1992, see USITC, Impact of the Caribbean Basin Economic Recovery Act
on U.S. Industries and Consumers: The First Ten Years of CBERA: Ninth Report, 1993 , USITC publication 2813,
Sept. 1994.
Source: U.S. International Trade Commission/Compiled from official statistics of the U.S. Department of
Commerce.WT/L/288
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Table 4
U.S. imports for consumption from CBERA countries, by duty treatment,
1984, 1988, 1992 and 1996-97
Item 1,984 1,988 1,992 1,996 1,997
Value (1,000 dollars, customs  value)
          Total imports........................ 86,492,35 1 60,610,542 9,425,616 14,544,810 16,572,402
Dutiable value3............................... 4 ,567,416 1 ,975,850 3 ,269,148 4 ,568,359 5 ,320,617
     Production sharin g4................... (5) 427,144 863 ,225 1 ,878,840 2 ,437,620
    CBERA reduced dut y6............... (7) (7) 29,418 43 ,373 55 ,471
    Other dutiable............................. 4 ,567,416 1 ,548,706 2 ,376,505 2 ,646,146 2 ,827,526
Duty-free value8............................. 4 ,081,819 4 ,085,204 6 ,156,467 9 ,976,451 11 ,251,785
    Col. 1- general9........................... 2 ,170,537 1 ,927,912 2 ,097,079 3 ,065,042 3 ,237,554
    Production sharin g10................... 587 ,560 906 ,518 1 ,777,260 3 ,304,510 4 ,478,633
    CBERA11.................................... 575 ,994 790 ,941 1 ,498,556 2 ,747,682  3 ,152,371
    GSP12592,249 353 ,079 340 ,666 163 ,659 228 ,885
    Other dut y free13......................... 155 ,479 106 ,754 442 ,904 695 ,558   154 ,341
Percent of total
        Total im ports.......................... 100 100 100 100 100
Dutiable value3............................... 53 33 35 31 32
     Production sharin g4................... (5) 7 9 13 15
     CBERA reduced dut y6.............. (7) (7) 0 0 0
     Other dutiable............................ 53 26 25 18 17
Duty-free value8............................. 47 67 65 69   68
     Col. 1- general9.......................... 25 32 22 21   20
     Production sharin g10.................. 7 15 19 23 27
     CBERA11................................... 7 13 16 19 19
     GSP1276 4 1 1
     Other duty free13........................ 2 2 5 5 1
  1 Nicaragua and Guyana, currently covered by CBERA, were not beneficiaries and therefore were excluded from the data for
1984.   
2 Nicaragua, currently covered by CBERA, was not eligible and therefore excluded from the data for 1988.
   3 Dutiable value excludes the U.S. content entering under HTS subheading 9802.00.80 and subheading 9802.00.60, and
misreported imports.   
4 Value of Caribbean Basin-origin value added, under HTS subheading 9802.00.80 and subheading 9802.00.60, excluding
items entered under CBERA or GSP provisions.   
5 Not available, included in “Other dutiable.”
   6 Value of imports of handbags, luggage, flat goods, work gloves, and leather apparel subject to 20-percent duty reductions
under the CBERA between 1992 and 1996.   
7 Presidential Proclamation 6428 of May 1, 1992 first implemented reduced duties for certain products of  beneficiary countries
under CBERA.   
8 Calculated as total imports less dutiable value.
   9 Value of imports which have a col. 1-general duty rate of free.
  10 Value of nondutiable exported and returned U.S.-origin products or components, under HTS subheading 9802.00.80 and
subheading 9802.00.60, excluding items entered under CBERA or GSP provisions.WT/L/288
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  11 Reduced by the value of unconditionally duty-free imports and ineligible items that were misreported as entering under the
CBERA program and the value of reduced-duty items (handbags, luggage, flat goods, work gloves, and leather wearing apparel)reported separately above as dutiable.  
12 Reduced by the value of unconditionally duty-free imports and ineligible items that were misreported as entering under the
GSP program.  
13Calculated as a remainder, and represents imports entering free of duty under column 1-special.
Note.—Because of rounding, figures may not add to the totals shown.
Source: United States International Trade Commission/Compiled from official statistics of the U.S. Department of Commerce.
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