Editor’s note: Advocating for the floral industry’s needs on Capitol Hill is a key priority for the Society of American Florists. What issues are most likely to impact you and your business – and how? What is SAF doing about it? In this ongoing series, SAF senior lobbyist Joe Bischoff breaks down one issue at a time and outlines SAF’s advocacy work on it. This week, Bischoff talks about the Generalized System of Preferences renewal and what it means for the supply chain and access to duty-free fresh product.

Why is this issue important?

Access to floral products grown abroad is critical for the U.S. floral industry. Nearly 80% of cut flowers purchased in the U.S. are grown in other countries and almost 95% of those imported come from countries where relief from duties is applied, such as through free trade agreements. The Generalized System of Preferences (GSP) is a trade preference program that allows for duty-free entry into the U.S. for thousands of products from overseas, including cut flowers, which provides pricing stability for the industry. As of November 2020, the GSP expanded to include roses, meaning that U.S. wholesalers and importers no longer had to pay a 6.8 percent tariff on Ecuadorian roses. This change was culmination of a year-long effort by the Society of American Florists and other industry groups to bring economic relief to buyers in the industry. SAF estimated the change would save the industry $15-20 million in the next year alone.

In advocating for this issue, are we harming our own domestic rose growers?

SAF has always believed having a stable and healthy domestic flower supply is important to the industry. It’s why we led advocacy efforts to secure direct aid from the USDA last year to help domestic growers impacted by COVID. And each year we make the case for Congress to fund floriculture research that benefits domestic growers – an effort that’s resulted in $111 million in research finding to date. But domestic growers supply only 1.6 percent of the total U.S. rose market demand, so rose imports help meet overall demand in the U.S. and are especially needed to supplement supply in times of peak demand, such as Valentine’s Day.  Eliminating the 6.8 percent tariff on Ecuadorian roses will not harm the outlook for domestic rose production. But it does remove a cost of doing business in the supply chain that would be passed on to retailers, and ultimately, consumers. This position aligns with SAF’s trade philosophy: We believe free trade policies promote innovation and competition and generate economic growth, which means we oppose any tariff or non-tariff barriers that could cause an interruption in floral industry commerce.

What specifically are we asking for?

GSP expired at the end of 2020 (the program must be renewed every two to three years). Congress must pass a bill to extend the program’s benefits. Duty-free access for cut flowers through GSP means that the floral industry saves at least $40 million annually in tariffs, allowing local and family-owned floral shops and wholesalers to invest these resources in hiring additional staff, promoting consumer purchases, and investing in the future of family businesses. For all of these reasons, SAF is asking Congress to renew GSP benefits as soon as possible.

What are the details of the conditions for renewal?

Ways and Means Committee Chairman Richard Neal (D-MA) said GSP renewal would, as in years past, be retroactive, allowing for refunds of duties incurred during the lapse in benefits. While some lawmakers want to extend GSP without changes, others are pushing to reform the program’s eligibility criteria. Chairman Neal commented that Congress would “upgrade” the program, referencing reforms to human rights, rule of law and anticorruption aspects that would work to correct inequities in trade policy. Other legislators have been looking for exporting countries to enforce their environmental laws or meet international environmental obligations in order to participate in GSP. For his part, Senate Finance Committee Chairman Ron Wyden (D-OR) has also pushed for “improvements” to the GSP program.

What is the expected timing of the renewal—and what could get in the way of that?

Congress is expected to take up GSP’s renewal and “upgrade” the program this year. One hurdle is the confirmation of a new United States Trade Representative (USTR).  The office of the USTR manages the GSP program and lawmakers have indicated they’d withhold consideration of legislation to renew GSP until the new USTR is in place. The full Senate will consider the nomination of Katherine Tai to be USTR as early as this week.

What can members do to get involved in this issue?

Make plans to join us virtually for SAF’s Congressional Action Days, April 13-14, where you can voice your support for the renewal of GSP and provide stories to lawmakers about the program’s financial impact on your business. During CAD members will also be advocating for other issues important to the floral industry, including minimum wage, funding for floriculture research and a stable agricultural labor force.

Katie Butler is the senior vice president of the Society of American Florists.