CHAPTER 2
Preferential Access to the United States and Manufacturing Export Performance: A Product-Level Analysis Ana M. Fernandes, Hibret Maemir, Aaditya Mattoo, and Alejandro Forero Rojas
Introduction Did preferential access to the US market durably boost African manufacturing export performance? To address this question, this chapter uses product- level data that take advantage of two trade policy changes in the United States at the turn of the twenty-first century: • The expansion of Generalized System of Preferences (GSP) products for least developed countries (LDCs) in 1997 and the implementation of the US African Growth and Opportunity Act (AGOA) in 2001— which together allow us to assess whether preferential access boosts the exports of all eligible products in general and of apparel specifically • The 2005 phaseout of the Multifiber Arrangement (MFA), which allows us to assess whether any expansion in apparel exports persisted beyond the erosion of trade preferences. The analysis relies on a highly detailed trade and tariff database that we constructed by combining US Census Bureau data on imports with US tariff data published by the US International Trade Commission (USITC), which jointly result in 26 years of data (1992–2017) on exports to the United States at the country Harmonized System (HS) 6-digit- level. Analytical Context and Emerging Patterns To place the US trade policy changes in context, well before the entry into force of the AGOA in 2001, nearly 30 percent of the HS 8-digit tariff lines in the United States had zero most-favored-nation (MFN) tariffs, and another 35 percent were duty-free for LDCs under the 1970s GSP regime. The expansion of GSP products for LDCs in 1997 freed another 16 percent of US tariff lines from duties. 69
