RETAILERS TO U.S. PANEL: DON'T SANCTION CHINA

Byline: Jim Ostroff

WASHINGTON--Retail industry officials Tuesday told a federal trade panel that proposed trade sanctions against China would cause grievous damage to stores and retail prices on the goods involved to rise preciptiously.
"We urge you to avoid hurting the Main Street consumer as you strive to assist Hollywood," said Rob Hall, a National Retail Federation vice president and government affairs counsel, at a hearing before an inter-agency committee convened to decide on which Chinese imports the U.S. will impose 100 percent additional duties. The sanctions would be in retaliation for China's failure to enforce international intellectual property rights covenants.
The alleged Chinese duplication of blockbuster U.S. movies for sale worldwide has been a key issue, with movie industry executives accompanying a U.S. negotiating team in Beijing. Talks aimed at ending the dispute before the Clinton administration's Feb. 4 deadline were continuing in China at press time.
Silk accessories such as scarves and shawls and footwear are among the many categories on a preliminary list the U.S. issued Dec. 31.
If resolution is not achieved, the U.S. will issue a list of products, with an import value of $1 billion, that will be hit with retaliatory duties. The hearings, which will continue today, feature officials from every industry cited on the U.S. preliminary list of $2.8 billion in Chinese trade. Other categories include consumer electronics and bicycles.
Virtually all these goods are sold in stores, which Hall said would suffer should any sector be included in the final U.S. "hit list" of Chinese imports.
Specifically, he said a new study by several conservative economists indicates for each 10 percent increase in import duty rates apparel sales fall by 16 percent and footwear sales by 20 percent. Consequently, should the proposed 100 percent additional duties be slapped on imports of these goods from China, their U.S. sales effectively would be eliminated.
Peter Mangione, president, the Footwear Distributors and Retailers of America, told the panel, "It is an error to select footwear for the retaliation list, because we will have real problems finding reasonably priced substitutes."
--Fairchild News Service

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