HOUSE PANEL OK’S EASE OF VIETNAM’S PATH TO MFN

Byline: Joyce Barrett

WASHINGTON — A House panel took another step Tuesday toward normalizing trade relations with Vietnam, while moving to diffuse some of the angst over the perennial Capitol Hill battle of renewing China’s most-favored-nation status.
On Vietnam, the House Trade Subcommittee voted to back President Clinton’s decision to extend limited U.S. government credit and investment guarantees to Vietnam, considered a precondition for granting most-favored-nation privileges. The full Ways and Means Committee is to take the proposal up Thursday, and it could be before the full house by the end of July, predicted Trade Subcommittee chairman Phil Crane (R., Ill.).
Vietnamese exports to the U.S. currently face tariffs ranging from 40 to 80 percent, since it is one of six countries not granted low tariffs under the MFN status afforded more than 150 other U.S. trading partners. Last year, Vietnam exported to the U.S. 14.7 million square meters equivalent (SME) in textile and apparel products, practically all of it cotton apparel. Through April of this year, Vietnam exported 15.9 SME, according to Commerce Department figures. Footwear and apparel makers sourcing there are seeking to normalize trade with Vietnam to enhance competitiveness.
On China, the House Trade panel approved a bill that would change the term “most-favored-nation” trade benefits to normal trade relations. Aimed at defusing some of the critics of MFN for China, Crane said, “The term ‘most-favored-nation’ has been quite misleading because it has implied that we were extending benefits greater than the normal benefits we extend to our trading partners under the World Trade Organization…
“We should be clear to the American people and call this treatment what it really is: merely normal,” he said.
China’s trade status is once again before Congress, as it has been annually since the Tiananmen Square massacres of 1989. On June 3 Clinton notified Congress that he intended to extend MFN for another year. While he doesn’t need congressional permission to extend it, Congress can vote to deny it and a denial resolution has been introduced.
Critics of China’s status and of its human rights policies held a Capitol Hill press conference Tuesday, the eve of Clinton’s planned visit to China, to ask the President to address the problem of those still held prisoner in China and continuing human rights abuses. Groups participating in the conference included the AFL-CIO, the Center for Jewish and Christian Values, Amnesty International and the International Campaign for Tibet.

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