HOUSE PASSES AFRICA-CBI TRADE BILL

Byline: Joanna Ramey

WASHINGTON — The House Thursday overwhelmingly passed the apparel tariff-eliminating Africa-Caribbean Basin bill, a significant trade victory for Republican leadership and the Clinton administration.
The measure cleared the House on a 309 to 110 vote, and just in the nick of time. Leadership sped the bill onto the floor only a day after lawmakers ended feverish negotiations on several textile provisions. They didn’t want the measure to be caught up in globalization angst felt in the House over another trade vote in three weeks: whether to grant China normal trade relation status in its bid to join the World Trade Organization.
The Senate is expected to take up the Africa-Caribbean Basin bill next week. The measure drops duties on apparel made in both regions if U.S. textiles are used. Some exceptions are made for regionally produced fabric and, in the case of sub-Saharan Africa, textiles from other countries.
The apparel union UNITE has opposed the measure as a garment industry job killer, a position echoed by several lawmakers like Rep. John Spratt (D., S.C.), who said the measure will have a “far-reaching effect” on the industry and should not have been rushed to the floor so quickly for consideration.
But those applauding the bill’s passage in the House did so for various reasons. Many lawmakers stressed the importance of the U.S. finally extending trade preferences to the 48 poor countries in sub-Saharan Africa. Africa now accounts for less than 1 percent of the $65 billion in U.S. apparel imports.
“This is the first time we’re treating countries on this continent the way we treat other countries in the world,” said Rep. Charles Rangel (D., N.Y.), a bill sponsor, who urged colleagues not to take out any negative feelings about China and the WTO on the Africa-Caribbean Basin measure.
The U.S. textile and yarn industries celebrated the House vote since they consider the bill key to increased business and their survival after global textile quotas are phased out in 2005. U.S.-based apparel companies, already with production in the regions, said the measure would spur them to shift some production from Asia. At the minimum, apparel imports from the Caribbean Basin would realize $1.42 billion in duty savings over five years, according to congressional estimates based on 1998 trade.
For their part, retailers would like to develop Africa as an exporting platform. But their enthusiasm, as well as that of other importers, is tempered because of the relatively small exceptions made in the bill for apparel made from non-U.S. fabric.
They also opposed inclusion of a so-called “carousel amendment” that rotates the goods subject to sanctions by the U.S. in trade disputes.
“We’re supportive, but we’re not wildly enthusiastic” about the bill, said Erik Autor, vice president of international trade at the National Retail Federation.
He said the strong vote in the House bodes well for passage in the Senate.
Among the most ecstatic over the measure clearing the House were officials in the men’s tailored clothing industry. They secured an amendment to the bill that would lower duties to 6 percent from 29.4 percent on imported fine woolens, limited to 4 million square meter equivalents a year, which would increase by 1 million SMEs annually for three years.
Moreover, $30 million in tariffs paid in 1999 would be rebated and a portion would be shared with wool farmers. Industry officials have long complained of a disadvantage they have with Canadian suit imports made of European woolens that are charged a 6 percent duty under the North American Free Trade Agreement.