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House Committee Scales Back Trade Bill

The House Ways & Means Committee passed a significantly scaled back trade preference bill.

WASHINGTON — The House Ways & Means Committee passed a significantly scaled back trade preference bill on Thursday, extending trade benefits for Colombia, Peru, Bolivia and Ecuador until Dec. 31. 

The Andean trade preference program expires on Feb. 28. 

The vote on just the Andean trade preferences marked a vastly different approach than one House Ways & Means Chairman Charles Rangel (D., N.Y.) had intended on taking with a much broader trade preference bill he introduced last week. 

It also signaled a struggle between Democrats and Republicans and the Bush administration over a pending, controversial bilateral free trade agreement with Colombia. 

U.S. apparel importers shipped $1.29 billion of apparel made in the Andean region to the U.S. in 2007. Importers had hoped for a longer extension but the short-term extension will give them duty-free benefits for apparel made in the Andean region through the end of the year. 

Rangel’s original bill sought more than a 2-year extension for the four Andean countries, and the same extension for trade benefits for all of the Caribbean countries and the Generalized System of Preferences. The bill also sought to eliminate a requirement in the African Growth & Opportunity Act that U.S. companies making denim in Africa use 30 million Square Meters Equivalent of local African denim before being allowed to use denim fabric from other countries in the world. 

But Rangel’s bill was gutted of all of those provisions in favor of a short-term extension of trade benefits for the four Andean countries. 

Some lawmakers said Rangel intends to bring up a second trade bill with some or all of those provisions that were eliminated from the bill that passed Thursday. 

Rep. Jim McCrery (R., La.) said that Republicans asked for a short-term extension to give them more time to convince Democrats to vote for the pending free trade deal with Colombia, which would make the preference program’s benefits permanent. 

The free trade deal has met considerable opposition from organized labor and many lawmakers, particularly Democrats, because of the assassinations of hundreds of union activists in that country that are believed to have been carried out by paramilitary groups. 

Both McCrery and Rep. Sander Levin (D., Mich.) pointed to concerns about recent restrictions on private sector companies by the governments of Bolivia and Ecuador as reasons for providing only a short term extension of trade benefits for those countries.