[Congressional Record Volume 159, Number 29 (Thursday, February 28, 2013)]
[Senate]
[Page S1029]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN:
  S. 431. A bill to authorize preferential treatment for certain 
imports from Nepal, and for other purposes; to the Committee on 
Finance.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce the Nepal 
Trade Preferences Act.
  This legislation is simple and straightforward. It grants duty-free 
status to imports of Nepalese garments for a seven year period.
  As a friend of Nepal and the Nepalese people for over 25 years, I 
believe this bill will promote economic prosperity and lasting 
political stability in one of the world's poorest countries.
  Nepal has a per capita income of $540.
  Approximately 25 percent of the Nepal's 24 million people live in 
poverty.
  The unemployment rate in Nepal stands at a staggering 47 percent; and 
most Nepalese live on $3 a day.
  Nepal's poverty was also compounded by a devastating, 10-year Maoist 
insurgency which resulted in the deaths of 13,000 people.
  Thankfully, on November 21, 2006 Nepal's government and Maoist rebels 
signed a peace accord.
  Two years later, Nepal became a republic and a Constituent Assembly 
was elected to draft a new constitution.
  Unfortunately, this momentum has stalled and Nepal remains without a 
new constitution.
  Challenges persist for Nepal's economy.
  In 2005, in accordance with an international agreement, all quotas on 
garment imports were removed.
  This has had a devastating impact on Nepal's garment industry as U.S. 
importers have shifted their orders to China, India and other suppliers 
with cheaper labor markets.
  The number of people employed by the Nepalese garment industry 
dropped from over 100,000 people--half of them women to between 5,000 
and 10,000.
  Garment exports fell from approximately $139 million in 2000 to $47 
million in 2011.
  The number of garment factories plummeted from 450 to 10.
  The U.S. share of Nepalese garment exports dropped from 90 percent to 
21 percent.
  Despite Nepal's poverty and the collapse of the garment industry, 
Nepalese garments are still subject to an average U.S. tariff of 11.7 
percent and can be as high as 32 percent.
  In essence, we are penalizing an impoverished country which cannot 
afford it. This makes no sense.
  I would point out that U.S. tariffs on Nepalese garments stand in 
contrast to the European Union, Canada, and Australia which allow 
Nepalese garments into their markets duty free.
  It should come as no surprise, then, that while the U.S. share of 
Nepalese garment exports has fallen, the European Union's share has 
risen from 18.14 percent in 2006 to 46 percent in 2010.
  The purpose of the Nepal Trade Preferences Act is to ensure that we 
provide Nepal with the same trade preferences afforded to it by other 
developed countries. No more, no less.
  Humanitarian and development assistance programs should be critical 
components of our efforts to help Nepal.
  But we should also help the Nepalese people help themselves and open 
the U.S. market to a once thriving export industry.
  In the end, economic growth and prosperity can be best 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.
  With this legislation, the United States can make a real difference 
now to help revitalize the garment industry in Nepal and promote 
economic growth and higher living standards.
  The impact on the domestic industry will be minimal. At most, 
Nepalese garments have accounted for 0.26 percent of all garment 
imports in the United States generating $14 million in revenue.
  Nepal will continue to be a small player in the U.S. market.
  But to allay any concerns that Nepalese garments will somehow flood 
the market, this bill does place sensible restrictions on the amount of 
garments that will receive duty free status. That amount will rise 
every year up to a specific percentage of all U.S. garment imports.
  By passing this legislation, we will help ensure that the garment 
industry will be a big player in contributing to Nepal's economic 
growth and development. This will be more jobs and a rising standard of 
living for the Nepalese people.
  Let there be no doubt, it is my hope that this bill will also spur 
Nepal's political parties to come together, resolve their differences, 
and finalize a new constitution. Lasting political stability is 
essential if Nepal is to fully realize the economic benefits of this 
legislation.
  Almost 7 years ago, the Nepalese people embraced peace and 
reconciliation. Let us show our solidarity with them and demonstrate 
our commitment to the success of the peace process by passing this 
commonsense measure.
  I urge my colleagues to support the Nepal Trade Preferences Act.
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