US CONGRESSIONAL AIDE DOUBTS TEXTILE QUOTAS WILL GO IN 2005

1:30 PM Jul 4, 1997

US CONGRESSIONAL AIDE DOUBTS TEXTILE QUOTAS WILL GO IN 2005
Geneva, 4 July (TWN) -- A key US republican congressional aide has expressed doubts that the textiles and clothing quota restrictions in the US and other industrial countries would be eliminated in 2005, as envisaged in the Uruguay Round Agreement on Textiles and Clothing.

In an interview with a US Information Agency Economic Writer, published in the June 1997 Electronic Journal of the US Information Agency, Thelma Askey, Staff Director of the US House of Representatives Ways and Means subcommittee on Trade notes that in the future it would be more difficult for the US to provide "unilateral trade preferences as a kind of foreign aid", and cites the textiles and clothing trade as an example.

"Textiles," says Askey, "are supposed to go to free trade under the WTO in 2005. Now, completely free trade in textiles will make it hard for the US to give special access to places like the Caribbean, which it has done in the past as a form of assistance under the Caribbean Basic Initiative.

"When everybody goes to free trade in textiles, China will clearly be more competitive than the Caribbean. In this kind of situation, it's going to be harder to have those special relationships. We'll just have to find other ways to give assistance to countries or regions of strategic importance to us."

"But I have my doubts that the countries will go to free trade in textiles when they promised because of the way it's structured in the WTO agreements. Governments agreed that they would have close to full protection until the final year, after which quotas would be eliminated all at once. It's going to be pretty hard to take that step off the cliff at the end."

In that same interview, asked about the US record on trade liberalization and whether that impulse was now stronger than one towards protectionism, Askey replied that in very trying circumstances, in 1988 Congress and the administration took a much broader approach to keep a liberalised trade regime. The administration, working with Congress, saw through to the final conclusion of the negotiations and implementation of two liberalising efforts - the NAFTA and the WTO. "On balance, over the last 20 years, US trade law has moved towards liberalization.

"But I think in the last five years, it's been moving toward more protection. However, members of the Congress and the administration have resisted their worst instincts in favour of maybe more modest protectionist steps. But I think it has become harder and harder to maintain a free trade position."

About US dumping law, the Congressional aide says that "dumping statutes are a perfect example of the road away from liberalization" and that, in general, it has become significantly easier for a firm to bring a dumping case and chill trade even though it may not win the case in the end.

The US attitude towards dumping has been spreading as a result of the negotiations, and "we have basically convinced our European counterparts to follow our example, that using dumping laws is the best way to protect domestic industries from unwanted competition."

Askew did not believe the US dumping laws would be reformed in the near term, but as more experience is gained in the dumping statute negotiated in the WTO (presumably a reference to the Uruguay Round Agreement on dumping), and as there are more challenges in the WTO on how various countries decide to implement that trade law, "some of the problems with the law will be solved."