[Congressional Record Volume 149, Number 44 (Wednesday, March 19, 2003)]
[Senate]
[Pages S4000-S4001]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN:
  S. 662. A bill to extend to Nepal certain preferential treatment with 
respect to apparel articles; to the Committee on Finance.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce legislation 
to grant garment imports from Nepal duty free status in the United 
States for two years. We have an opportunity the help one of the 
world's most impoverished countries sustain a vital export industry and 
promote political and economic stability after years of conflict.
  My interest in Nepal goes back over 25 years and I have had the 
pleasure to travel there and visit with friends on many occasions. The 
warmth and friendliness of the people and the vitality and richness of 
the culture are only matched by the beauty of the breathtaking 
landscape.
  Nevertheless, Nepal faces some serious challenges in the years ahead 
as it attempt to build a prosperous economy and raise the living 
standards of its people.
  It ranks as the 12th poorest country in the world, with a per capita 
income of $240. Approximately 42 percent of the 24 million people live 
in poverty. Unemployment stands at 47 percent.
  On top of this, Nepal has had to confront a Maoist insurgency which 
has claimed the lives of more than 7,200 people since 1996 with two 
thirds of the deaths occurring since November 2001. Estimated to 
include between 5,000 and 10,000 armed soldiers, the Maoists control 
between one-quarter and one-half of the country.
  As a result of the political instability, for the first time in 
twenty years Nepal's economy contracted in 2002 by 0.6 percent and 
tourism, one of the main sources of income, fell by 27 percent. The 
situation became so dire last year that one advisor to Nepal's king 
noted that ``Nepal is on the verge of becoming a failed state.''
  Yet there is reason for hope. On January 29, 2003 the Government of 
Nepal and the Maoist rebels reached a cease-fire agreement, opening the 
door for negotiations for a permanent end to the conflict. I am hopeful 
they will be successful. We now have the opportunity to build on the 
hopes of a peaceful solution to conflict and really make a difference 
in the lives of the Nepalese people.
  Humanitarian and development assistance should be an important part 
of that effort. But we should also help the Nepalese help themselves 
and open the U.S. market to a critical export industry. In the end, 
economic growth and prosperity can best be achieved when Nepal is given 
the chance to compete and grow in a free and open global marketplace.
  Success in that marketplace will lead to a lesser dependence on 
foreign aid and encourage Nepal to develop other viable export 
industries.
  Since the mid-1980s, garments have emerged as a key part of Nepal's 
manufacturing sector. The garment industry in Nepal is entirely export 
oriented and accounts for 40 percent of the foreign exchange earnings. 
It employs over 100,000 workers half of them women and sustains the 
livelihood of over 350,000 people. The United States is the largest 
market for Nepalese garments and accounts for 80-90 percent of Nepal's 
total exports every year.
  Yet, despite Nepal's poverty and the importance of the garment 
industry and the U.S. market, Nepalese garments are subject to U.S. 
tariffs of 17-35 percent. This is simply not acceptable and does harm 
to a country that can least afford it.
  I might point out that this tariff rate is in contrast to the 
European Union, Canada, and Australia which allow or will soon allow 
Nepalese garments into their markets duty free.
  The United States can make a real difference now to sustain the 
garment industry in Nepal and promote economic growth and higher living 
standards. My bill is simple and straightforward. It grants duty free 
status to imports of Nepalese garments and textiles for a two year 
period. This is the same status granted to participating lesser 
developed countries under the African Growth and Opportunity Act.
  For those of my colleagues who are concerned about the impact that 
duty free status for Nepalese garments and textiles would have on the 
domestic industry, it is worth noting that Nepalese garments, at their 
highest level, accounted for 0.1 percent of all garment and textile 
imports in the United States generating $29.5 million in revenue.
  Nepal is, and will continue to be, a small player in the U.S. garment 
market, but the importance of the garment industry in Nepal compels us 
to action.
  Let us not miss this chance to help Nepal build a better future for 
its people and demonstrate to them and the rest of the world the desire 
of the United States to see developing nations rise from poverty to 
economic prosperity. I urge my colleagues to support this legislation.

[[Page S4001]]

  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 662

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

     SECTION 1. TREATMENT OF CERTAIN TEXTILES AND APPAREL.

       Notwithstanding any other provision of law, the 
     preferential treatment extended to apparel articles under 
     section 112(b)(3)(B) of the African Growth and Opportunity 
     Act (19 U.S.C. 3721(b)(3)(B)) shall also apply to apparel 
     articles that are imported directly into the customs 
     territory of the United States from Nepal in accordance with 
     the provisions set forth in such section as if such articles 
     were articles of a lesser developed beneficiary sub-Saharan 
     African country, if Nepal has satisfied the requirements set 
     forth in section 113 of such Act (19 U.S.C. 3722), except 
     that--
       (1) any reference in section 112(b) or section 113 of the 
     African Growth and Opportunity Act to a lesser developed 
     beneficiary sub-Saharan African country or countries) shall 
     be treated as a reference to Nepal; and
       (2) such preferential treatment shall apply to apparel 
     articles imported into the customs territory of the United 
     States during the period beginning on October 1, 2003, and 
     ending on September 30, 2005.
                                 ______