← Back to results
Federal

Western Hemisphere Nearshoring Act

Source: Congress.gov  ·  4,318 words in original text
What This Bill Does
This bill aims to help companies move manufacturing from China to Latin America and the Caribbean. It provides financial support, lower interest rates on loans, and duty-free (zero tariff) trade benefits to encourage this relocation. The bill intends to reduce dependence on Chinese manufacturing and create economic opportunities that discourage migration from the region. ##
Who It Affects
• Companies moving manufacturing operations from China to Latin America or the Caribbean • The U.S. International Development Finance Corporation (a government lending agency) • Latin American and Caribbean countries • The U.S. Trade Representative • The President of the United States • American workers and businesses ##
Key Provisions
• At least 10 percent of available development financing money must fund moving costs and worker training for companies relocating from China, with reduced interest rates on the loans. (Sec. 3) • The President can declare that goods and services made by relocating companies in Latin America or the Caribbean receive duty-free treatment (no import taxes) for 15 years after the company starts operations there. (Sec. 4) • Companies receiving assistance must move all relevant assets from China to Latin America or the Caribbean within 2 years and keep them there, and cannot be owned or controlled by China, Russia, or other "foreign adversaries." (Sec. 5) • A trust fund will be created using tariff money collected from Chinese goods to pay for assistance provided under this bill. (Sec. 6) • The U.S. Trade Representative must start negotiations for free trade agreements with Latin American and Caribbean countries that are not already party to such agreements with the U.S., if those countries are reducing migration and economic dependence on China and allow Taiwan to establish a commercial office. (Sec. 8) • Companies relocating manufacturing can receive enhanced tax deductions on equipment and property placed in service in Latin America or the Caribbean before January 1, 2038. (Sec. 10) ##
What Changes
If this bill becomes law: • Companies moving from China to Latin America or the Caribbean can access special government loans with reduced interest rates to cover relocation costs and worker training. • Goods made in Latin America or the Caribbean by relocating companies will enter the United States with no tariffs for 15 years. • The government will pursue trade agreements with Latin American and Caribbean countries meeting certain conditions. • Companies must guarantee they will not come under control of China, Russia, or other foreign adversaries, and must move all operations within 2 years. • Companies that violate these commitments will lose tariff benefits and must repay loans at market interest rates. • Money from tariffs on Chinese goods will fund the assistance program rather than going to general government revenue. ##
Important Definitions
**DFC:** The United States International Development Finance Corporation (a government agency that provides loans and financing). **Qualified Corporation:** A company receiving assistance under this bill that is not state-owned by any foreign government. **Qualified Moving Costs:** Expenses for moving inventory, equipment, supplies, and workforce development or facility construction when relocating from China. **Latin American or Caribbean Country:** Any country in the Caribbean Sea, South America, Central America, or Mexico. Does not include Cuba or Venezuela unless the Secretary of State certifies specific conditions have been met (free elections, human rights protections, free market economy, humanitarian aid access, release of detained Americans, and removal of foreign adversary security services). **Federal Funds Rate:** The discount window primary credit interest rate most recently published by the Federal Reserve. **Foreign Adversary:** A foreign government engaged in a long-term pattern or serious conduct significantly harmful to U.S. national security or safety of Americans. ##
Effective Date
The bill takes effect upon enactment for most provisions. The tax provision for equipment and property applies to items placed in service after the bill's enactment and before January 1, 2038. The DFC must submit its plan to streamline assistance within 180 days of enactment.
Important: This plain English summary was generated by AI and is provided for informational purposes only. It is not legal advice. Always consult the official bill text on Congress.gov or a qualified attorney for legal matters.