[Congressional Record Volume 142, Number 117 (Friday, August 2, 1996)]
[Extensions of Remarks]
[Page E1479]
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

                         Friday, August 2, 1996

  Mr. NEY. Mr. Speaker, when the House debated budget reconciliation 
last October, I submitted a statement for the Record in support of the 
provisions in the bill to reauthorize the generalized system of 
preferences [GSP] duty-free import program. Today, the House will again 
debate this issue as part of a larger bill to raise the minimum wage. I 
would like to again reaffirm my support for the reauthorization of the 
GSP 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 United States 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 not 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 Dillion and Kennedy rounds of the General Agreement on 
Tariffs and Trade [GATT]. During this period the American ceramic tile 
also has been forced to defend itself from over a dozen petitions filed 
by various designed 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 counties 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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