CBI PARITY SEEKERS BIDING TIME FOR NOW

Byline: Joyce Barrett

WASHINGTON--The backers of broadening trade benefits for Caribbean apparel makers can afford to play a waiting game, for awhile.
So says Leonard Rosenburg, Caribbean trade consultant with Sandler, Travis & Rosenburg, Miami, who noted that the refusal of Congress during the last session to grant these extended benefits has not triggered any panic in the Caribbean.
Proponents of giving Caribbean Basin Initiative countries trade benefits commensurate with those given Mexico under the North American Free Trade Agreement have argued that without the equivalent treatment, apparel companies that have set up CBI sourcing will relocate or expand to Mexico to avoid the value-added duties levied on goods from the Caribbean.
However, Rosenburg said he has seen no exodus by apparel makers in the region since NAFTA went into effect on Jan. 1. Rather, in the last year, he has seen six apparel firms expand their operations or move to the Caribbean.
"It would be precipitous to pull out now," Rosenburg said in a telephone interview from his Miami office. "Ultimately, the Caribbean will likely get parity. It's just not in the best interests of the United States to see the Caribbean fall behind."
Still, he said, it's critical that the Caribbean's trade benefits are broadened before free trade between the U.S. and Mexico cuts into commerce between the U.S. and the 24 Caribbean countries.
"I would give it 12 or 18 more months," Rosenburg said. "If there is no parity by then, then it's serious."
Rep. Sam Gibbons (D., Fla.), acting chairman of the House Ways and Means Committee and the biggest congressional advocate of broadening Caribbean trade, has vowed to bring his parity plan back again next year.
"It's the correct and right thing to do," Gibbons said. "I'm disappointed we didn't get CBI parity in GATT, but the problem was in the Senate."
A parity plan was included in the House version of GATT implementing bill but omitted from the Senate's. The White House, asked to make a final decision, struck it from the final implementing legislation.
Gibbons said he's considering attaching his parity plan to an extension of fast-track negotiating authority that Sen. Daniel P. Moynihan (D., N.Y.) plans to introduce next year when the 104th Congress convenes. Parity and fast track were included initially in the GATT bill by the administration, but fell to political pressures from various constituencies. It was pressure from Moynihan, in fact, that was instrumental in killing Gibbons's Caribbean parity plan.
One problem with the Caribbean parity plan is that it has no strong constituencies in Congress. While the Congressional Black and Hispanic caucuses favor it, along with the 23-member Florida House delegation, it does not enjoy substantial support in the Senate.
Sen. Bob Graham (D., Fla.) has introduced parity plans and has mustered nominal support, but has not been successful in attaining a majority. Also, there is no organized lobbying effort for parity, while organized labor--which has historically opposed it--successfully pressed for its exclusion earlier this year.
The administration supports it and vows to back Gibbons next year.
"We will push it next year," said Deputy U.S. Trade Representative Rufus Yerxa. "We already give tremendous trade benefits to the Caribbean countries under the Caribbean Basin Initiative. We know they are disappointed that it wasn't in GATT, but everything in its time."
--Fairchild News Service

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