[Congressional Record Volume 141, Number 167 (Thursday, October 26, 1995)]
[Extensions of Remarks]
[Page E2048]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   GENERALIZED SYSTEM OF PREFERENCES

                                 ______


                           HON. ROBERT W. NEY

                                of ohio

                    in the house of representatives

                       Thursday, October 26, 1995

  Mr. NEY. Mr. Speaker, as the House debates budget reconciliation I 
would like to give my support to the provisions in the bill renewing 
generalized system of preferences [GSP] duty-free import program. This 
program was designed as a way to help less-developed nations export 
into the U.S. market. The GSP program allows duty-free imports of 
certain products into the U.S. from over 100 GSP-eligible countries. 
The bill wisely provides that import-sensitive products are not to be 
subject to GSP treatment. Ceramic tile is a clear example of an 
``import sensitive'' product and is exactly the type of product which 
should be subject to lower tariffs under the GSP program.
  Imports have dominated the U.S. ceramic tile market for the last 
decade and they currently capture nearly 60 percent of the market. This 
extraordinary level of import penetration is a result, in part, of over 
30 years of documented unfair predatory foreign trade practices 
including dumping, subsidies, customs fraud, import diversion, and 
abuse of a loophole in the GSP. The American ceramic tile industry, 
though relatively small, is efficient and competitive at normal tariff 
levels.
  From its inception in the Trade Act of 1974, the GSP program has 
provided for the exemption of ``articles which the President determines 
to be import-sensitive.'' In light of the history of unfair trade in 
ceramic tile and the significant and growing import participation in 
the U.S. ceramic tile market, the U.S. industry has been recognized by 
successive Congresses and administrations as ``import-sensitive,'' 
dating back to the Dillon and Kennedy Rounds of the General Agreement 
on Tariffs and Trade [GATT]. During this period the American ceramic 
tile industry also has been forced to defend itself from over a dozen 
petitions filed by various designated GSP-eligible counties seeking 
duty-free treatment for ceramic tile into this market. If just one 
petitioning nation succeeds in gaining GSP benefits for ceramic tile, 
then by law, every GSP beneficiary country is also entitled to GSP 
duty-free benefits for ceramic tile. If any of these petitions were 
granted, it would eliminate American tile jobs and could destroy the 
industry.
  A major guiding principle of the GSP program has been reciprocal 
market access. Current GSP-eligible beneficiary countries supply almost 
one-third of the U.S. ceramic tile imports and they are increasing 
their sales and market shares. U.S. ceramic tile manufacturers, 
however, are still denied access to many of these foreign markets. Many 
developing countries maintain exclusionary tariff and nontariff 
mechanisms which serve to block the entry of U.S. ceramic tile exports 
into these markets. Industrial countries, including the European Union 
[EU], may use less transparent methods such as discriminatory product 
standards and testing methods to control their ceramic tile imports 
and, in some cases, to divert ceramic tile manufactured in third 
countries over to the U.S. market by imposing restrictions on those 
third country exports to the EU.
  I am in support of the reauthorization of the GSP program and trust 
that import-sensitive products such as tile will not be subject to GSP.

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