[Congressional Record Volume 145, Number 19 (Wednesday, February 3, 1999)]
[Senate]
[Pages S1170-S1171]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. THOMAS (for himself, Mr. McCain, Mr. Kerry, Mr. Smith of 
        Oregon, and Mr. Robb):
  S. 354. A bill to authorize the extension of nondiscriminatory trade 
status to the products of Mongolia; to the Committee on Foreign 
Relations.


                  Mongolia Most-Favored-Nation Status

  Mr. THOMAS. Mr. President, I rise as chairman of the Subcommittee on 
East Asian and Pacific Affairs to introduce S. 354, a bill to authorize 
the extension of nondiscriminatory treatment--formerly known as ``most-
favored nation status''--to the products of Mongolia. I am pleased to 
be joined by Senator McCain, chairman of the Commerce Committee; 
Senator Kerry, the ranking minority member of my subcommittee; and 
Senator Robb and Senator Smith or Oregon as original cosponsors.
  Mongolia has undergone a series of remarkable and dramatic changes 
over the last few years. Sandwiched between the former Soviet Union and 
China, it was one of the first countries in the world to become 
communist after the Russian Revolution. After 70 years of communist 
rule, though, the Mongolian people have recently made great progress in 
establishing a democratic political system and creating a free-market 
economy. Since that time, there have been successive successful 
national and regional elections.
  Mongolia has demonstrated a strong desire to build a friendly and 
cooperative relationship with the United States on trade and related 
matters since its turn towards democracy. We concluded a bilateral 
trade treaty with that country in 1991, and a bilateral investment 
treaty in 1994. Mongolia has received nondiscriminatory trading status 
since 1991, and has been found to be in full compliance with the 
freedom of emigration requirements of Title IV of the Trade Act of 
1974. In additions, it has acceded to the Agreement Establishing of the 
World Trade Organization.
  Mr. President, Mongolia has clearly demonstrated that it is fully 
deserving of joining the ranks of those countries to which we extend 
nondiscriminatory trade status. The extension of that status would not 
only serve to commend the Mongolians on their impressive progress, but 
would also enable the U.S. to avail itself of all its rights under the 
WTO with respect to Mongolia.
  I have another, more parochial, reason for being interested in MFN 
status for Mongolia. Mongolia and my home state of Wyoming are sister 
states; a strong relationship between the two has developed over the 
last four years. Many of Mongolia's provincial governors have visited 
the state, and the two governments have established partnerships in 
education, agriculture, and livestock management. Like Wyoming, 
Mongolia is a high plateau with mountains on the northwest border, 
where many of the residents make their living by raising livestock. I 
am pleased to see the development of this mutually beneficial 
relationship, and am sure that the extension of nondiscriminatory trade 
status will serve to strengthen it further.
  Mr. President, I introduced an identical bill in the last Congress, 
but Congress adjourned sine die before the bill could be acted on by 
both houses. I was very appreciative that last year the distinguished 
chairman of the Finance Committee, Senator Roth, indicated his 
willingness to favorably consider the legislation early in this 
Congress, and look forward to working with him.
  Mr. President, I ask unanimous that the text of S. 354 be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 354

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. FINDINGS.

       Congress makes the following findings:
       (1) Mongolia has received nondiscriminatory trade treatment 
     since 1991 and has been found to be in full compliance with 
     the freedom of emigration requirements of title IV of the 
     Trade Act of 1974;
       (2) Mongolia has, since ending its nearly 70 years of 
     dependence on the former Union of Soviet Socialist Republics, 
     established a parliamentary democracy and a free-market 
     economic system;
       (3) Mongolia concluded a bilateral trade treaty with the 
     United States in 1991 and a bilateral investment treaty in 
     1994;
       (4) Mongolia has acceded to the Agreement Establishing the 
     World Trade Organization;
       (5) Mongolia has demonstrated a strong desire to build a 
     friendly and cooperative trade relationship with the United 
     States; and
       (6) The extension of nondiscriminatory trade status to the 
     products of Mongolia would enable the United States to avail 
     itself of all the rights available under the World Trade 
     Organization with respect to Mongolia.

     SEC. 2. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE 
                   ACT OF 1974 TO MONGOLIA.

       (a) Presidential Determinations and Extensions of 
     Nondiscriminatory Treatment.--Notwithstanding any provision 
     of title IV of the Trade Act of 1974 (19 U.S.C. 2431 et 
     seq.), the President may--
       (1) determine that such title should no longer apply to 
     Mongolia; and
       (2) after making a determination under paragraph (1) with 
     respect to Mongolia, proclaim the extension of 
     nondiscriminatory treatment to the products of that country.
       (b) Termination of Application of Title IV.--On or after 
     the effective date of the extension under subsection (a)(2) 
     of nondiscriminatory treatment to the products of Mongolia, 
     title IV of the Trade Act of 1974 shall cease to apply to 
     that country.

  Mr. McCAIN. Mr. President, today I am proud to cosponsor legislation 
with Senators Thomas, Robb, and Kerry to grant nondiscriminatory trade 
status to Mongolia. Passage of this legislation will play an important 
role in aiding Mongolia's transition to a democratic government and a 
market-oriented economy.
  There has been a stunning political transformation in Mongolia since 
it broke away from Communist rule in 1990. In the past seven years, 
there have been two presidential elections and three parliamentary 
elections. All of these have been open and democratic, and have not 
suffered from violence or fraud.
  The most important aspect of these elections is that they show the 
triumph of democracy and democratic forces. In 1996, the Mongolian 
Social Democratic Party (MSDP) and Mongolian National Democratic Party 
(MNDP) joined forces to win an unexpected victory in the parliamentary 
elections. By fulfilling its ``Contract with the Mongolian Voter,'' 
this coalition is ensuring the establishment of a political system 
based on our cherished democratic principles. After a few months of 
uncertainty, the Mongolian government is now back on track and 
committed to continue its reforms. I am happy to say that the 
International Republican Institute is continuing to play a major role 
in showing these political parties how to establish a stable democratic 
government.
  This democratic transformation has established a firm human rights 
regime. The Mongolian Constitution allows freedom of speech, the press 
and expression. Separation of Church and state is recognized in this 
predominantly Buddhist nation as well as the right to worship or not 
worship. Full freedom of emigration is allowed, and Mongolia now is in 
full compliance with sections 402 and 409 of the Trade Act of 1974, 
also known as the Jackson-Vanik Amendment. An independent judiciary has 
been established to protect these rights from any future violation.
  Mongolia is also in the middle of an economic transformation. As part 
of the ``Contract with the Mongolian

[[Page S1171]]

Voter,'' the democratic coalition of the MNDP and MSDP ran on promises 
to establish private property rights and encourage foreign investment. 
The Mongolian government is now steadily creating a market economy. A 
program has been set up to allow residents of government-owned high 
rise apartments to acquire ownership of their residence. In 1997, 
Mongolia joined the international trading system by joining the World 
Trade Organization and eliminating all tariffs, except on personal 
automobiles, alcoholic beverages, and tobacco. On January 1, 1999, the 
state-run press became privatized. The economic news also continues to 
be good. The 1997 GDP growth was 3.3%, and the inflation rate has 
dropped from 53.2% in 1996 to 9.2% in June, 1998. The Mongolian 
government is now boldly moving to set the nation on a course to 
privatize large-scale enterprise and reform the state pension system.
  When I was in Mongolia in 1997, I saw the effects of this economic 
transformation firsthand. At a town hall meeting in Kharakhorum, the 
ancient capital of the Mongol Empire, I met a herdsman and asked him 
about the economic liberalization. First, I asked him how many sheep he 
had under Communism. He said none, because the Communists didn't allow 
private property. Then I asked him how many sheep he owned after 
privatization. He answered that he had three sheep then, which is not 
much in a country with 25 million sheep. So I asked him how many sheep 
he has now. He answered that he now has 90 goats, 60 sheep, 20 cows and 
6 horses. I asked him if that was considered successful. He replied 
that he was successful as were many herdsmen in this new economy. He 
then told me that he would never want to change the system back to what 
it was, because ``now Mongols have control over their own life and 
destiny.'' That is the new culture of a market Mongolian economy.
  There are many benefits to supporting Mongolian democracy and 
economic liberalization. In 1991, Secretary of State James Baker 
promised Mongolia that the United States would be Mongolia's ``third 
neighbor.'' We remain committed to that course of action to encourage 
Mongolia in its endeavors and promote it as an example of how nations 
can successfully convert from a Communist totalitarian state to a 
market democracy. The democratic Mongolia has already begun to promote 
peace and stability among its neighbors by becoming the world's first 
national nuclear-free zone. Furthermore, the United States will be able 
to count on the liberalized Mongolian economy as an important market 
for American goods and services.
  I hope that my colleagues here in the Senate will join me in passing 
this legislation to grant nondiscriminatory trade status to Mongolia to 
help it continue its successful democratic transformation and 
transition to a market economy.
                                 ______