[Congressional Record (Bound Edition), Volume 147 (2001), Part 13]
[House]
[Pages 18949-18951]
[From the U.S. Government Publishing Office, www.gpo.gov]



                      ANDEAN TRADE PREFERENCE ACT

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 3, 2001, the gentleman from American Samoa (Mr. Faleomavaega) 
is recognized for 60 minutes as the designee of the minority leader.
  Mr. FALEOMAVAEGA. Mr. Speaker, I just learned yesterday that a bill 
was hastily prepared 2 nights ago by the staff of the Committee on Ways 
and Means and without the opportunity to seek comments and testimonies, 
even to appear before the Subcommittee on International Economic Policy 
and Trade, the bill was marked up in full committee this morning. The 
bill passed today by a vote of 23 to 17, rejecting my good friend's, 
the gentleman from New York (Mr. Rangel), amendment that would have 
literally saved the U.S. tuna industry.
  I wanted to thank my good friend, the gentleman from California (Mr. 
Baca) for his eloquent remarks, the gentleman from Louisiana (Mr. 
Jefferson) for his support, and the gentleman from Georgia (Mr. Lewis) 
for his support. I especially want to note, the precious vote that also 
was received by my good friend, the gentleman from Georgia (Mr. 
Collins) for his support of this legislation.
  Mr. Speaker, I sincerely hope the great spirit will enlighten my 
colleagues of the House, especially if this bill, H.R. 3009, the Andean 
Trade Preference Act, if this bill passes by not excluding tuna as a 
duty-free import from Andean countries, it will essentially mean the 
loss of some 10,000 jobs to tuna cannery workers in California, Puerto 
Rico, and my district of American Samoa.
  Mr. Speaker, current trade policy with regards to canned tuna has 
provided significant benefits to certain Latin American countries, 
while at the present time has maintained an industrial tuna processing 
base in the United States.
  Since the enactment of the Andean Trade Preference Act, a number of 
tuna factories in the Andean region has increased to 229 percent, 
production capacity is up to 400 percent, direct employment is up to 
257 percent, and U.S. exports have grown from about $15 million to $100 
million annually.

                              {time}  1315

  In addition, the U.S. tuna industry has invested over $20 million in 
new facilities and vessels. However, I must repeat, extending this 
agreement by providing duty-free treatment to canned tuna from Andean 
countries, especially Ecuador, will, in my opinion, destroy the U.S. 
tuna industry.
  I have heard the argument that Congress has included canned tuna both 
in the Caribbean Basin Initiative and NAFTA, and some have questioned 
why we are not doing the same for Ecuador and the Andean region. Well, 
the answer simply is that no other region, especially a country like 
Ecuador, once we allow duty-free canned tuna to be imported from the 
Andean countries, has the potential of literally wiping out or 
destroying the U.S. tuna industry.
  For example, Mr. Speaker, Ecuador alone has the production capacity 
now equivalent to 2,250 tons per day production. Using a 5-day 
workweek, this equates to a production capacity equivalent to 48.6 
million cases of canned tuna per year. And using a 6-day workweek, 
Ecuador's production capacity is equivalent to 58.5 million cases of 
canned tuna per year. Now, the interesting thing about this, Mr. 
Speaker, is that U.S. consumption is only 45.3 million cases of canned 
tuna per year. What does that mean? Ecuador could produce enough canned 
tuna to flood the entire U.S. market. And brand names like Chicken of 
the Sea and Bumble Bee, brands that Americans have come to trust, would 
be eliminated from grocery stores. It is even questionable whether tuna 
from Ecuador is dolphin-safe. So serious are these issues that Mexico 
levied a 24 percent duty last year on canned tuna exported from 
Ecuador.
  Mr. Speaker, it is also important to note that Ecuador levies a 20 
percent duty on imported canned tuna from the United States. Now, I am 
all for free trade, Mr. Speaker; but I am also for fair trade. The fact 
of the matter is, more than 10,000 jobs in my district, Puerto Rico, 
and California will be lost if H.R. 3009 passes in its current form. 
Why? Because the minimum wage rate for workers in Ecuador is 69 cents 
per hour. This is why a company like StarKist Tuna Company and its 
parent company, the Heinz Corporation, have

[[Page 18950]]

been pressuring Congress to allow StarKist to hire fish cleaners in 
Ecuador and pay Ecuadorans 69 cents per hour. Would this be considered 
cheap labor or slave labor, I ask, Mr. Speaker?
  Mr. Speaker, the Heinz Corporation, the parent company of StarKist 
Seafood Company, has lobbied for the inclusion of canned tuna as a 
duty-free import in the Andean Trade Agreement. But it must be made 
clear that the StarKist Seafood Company is also the only U.S. tuna 
processor that supports duty-free treatment for canned tuna exported 
from Ecuador. Put another way: StarKist is the only tuna processor 
willing, in my opinion, to sell out American workers in exchange for 
wages of 69 cents per hour to pay Latin American workers.
  As my colleagues may know, Mr. Speaker, American Samoa is the home of 
the largest tuna cannery facility in the world. One cannery facility is 
operated by StarKist, a subsidiary of Heinz Corporation; and the other 
facility is owned by the Chicken of the Sea, a company out of 
California. Today, these two companies employ more than 5,150 
employees, or 74 percent of American Samoa's workforce. Approximately 
80 percent of the private sector jobs in my district, Mr. Speaker, are 
dependent, either directly or indirectly, upon the tuna fishing and 
processing industry.
  As Malcolm Stockwell, former vice president of StarKist Seafood 
Company recently testified, and I quote, ``A decrease in production or 
departure of one or both of the existing processors in American Samoa 
could devastate the local economy, resulting in massive unemployment 
and insurmountable financial problems.''
  The chief executive officer of Chicken of the Sea has already noted 
that if the Andean Trade Agreement includes duty-free treatment for 
canned tuna, its operations in American Samoa would be forced to 
downsize by as much as 50 percent. StarKist has testified that if 
Ecuador is given the same trade preference as a U.S. territory, like my 
district, its production would almost immediately shift to low labor-
cost areas.
  Now, let us talk about labor-cost areas. In fact, I just want to 
share another bit of information with my colleagues this afternoon. 
Right now, under the Andean Trade Agreement, fish loins are exported 
duty free to the United States; and companies like Bumble Bee, Chicken 
of the Sea, and StarKist buy these fish loins from Andean countries, 
like Ecuador. But if canned tuna can also be imported duty free, what 
is to prevent these U.S. tuna companies from laying off 800 workers 
from Puerto Rico and closing their facilities in my district, as well 
as in California, and going and operating out of Ecuador and other 
Andean countries?
  Mr. Speaker, my people want to work. They do not want handouts. I do 
not know if my colleagues are aware of the fact that for the 40 years 
since the welfare program was implemented here in the United States, my 
leaders and our people have never wanted to have welfare applied to our 
territory. Why? Because we want to work. We do not want handouts. We 
want to work for what we earn. And if this happens, if this bill 
passes, with the destruction of the U.S. tuna industry, am I going to 
have to now come before the Congress and ask for subsidies in support 
of the 10,000 displaced workers as a result of this bad and poor 
legislation?
  Mr. Speaker, I specifically asked StarKist and H.J. Heinz executives 
what financial loss StarKist would incur if canned tuna was not 
included in the Andean Trade Agreement, and I was told StarKist would 
suffer no economic loss. In other words, StarKist is only in it for the 
lower labor cost among the Andean countries. I also wish to note that 
the minimum wage rate in my own district, in American Samoa, for a fish 
cleaner, is only $3.20 per hour, which is below the national minimum 
wage standard and which reminds me of these words offered by a good 
Senator from Idaho by the name of Senator Borah during the course of 
the Fair Labor Standards debate right here in this Chamber in 1937.
  Senator Borah said, and I quote, ``I look upon a minimum wage such as 
will afford a decent living as a part of a sound national policy. I 
would abolish a wage scale below a decent standard of living, just as I 
would abolish slavery. If it disturbed business, it would be the price 
we must pay for good citizens. I take the position that a man who 
employs another must pay him sufficient to enable the one employee to 
live.'' And Senator Pepper, from Florida, asked, ``Well, what if he 
cannot affords to pay it?'' Senator Bora responded, and I quote, ``If 
he cannot afford to pay it, then he should close up the business. No 
business has a right to coin the very lifeblood of workmen and women 
into dollars and cents. Every man or woman who is worthy of hire is 
entitled to sufficient compensation to maintain a decent standard of 
living. I insist that American industry can pay its employees enough to 
enable them to live.''
  Quite frankly, I agree with Senator Borah, Mr. Speaker. StarKist, 
like any other industry, should pay its employees, whether in Ecuador 
or American Samoa, enough to live. StarKist should not be about the 
business of lobbying to suppress wages.
  Mr. Speaker, I want to share a bit of history also with the Members. 
At a time when the national debate right here in this Chamber was about 
whether or not we should have a minimum standard wage rate, and this 
debate took place in 1937, the Members representing our fellow 
Americans from the South did not like the idea that if business wanted 
to find cheap labor they would go to the South. Industries up in the 
North always took advantage of the fact that they could find cheap 
labor if they would go to the South. Well, when this minimum wage was 
finally passed in the Congress, and after a hot debate in this Chamber, 
guess what, there was no economic chaos. There was tremendous growth 
that came along with it, with the increase of wages of the working men 
and women in our country.
  When all is said and done, Mr. Speaker, tuna processing is the only 
industry holding together the economy of my district, the Territory of 
American Samoa. American Samoa's only advantage in the global 
marketplace is duty-free access to the U.S. market. And what price has 
American Samoa paid to have the U.S. trade privileges? As a territory 
of the United States, our men and women have paid the ultimate 
sacrifice in military service to our Nation.
  American Samoa pledges its allegiance without question to this great 
Nation of ours. Ecuador and other Andean countries do not. American 
Samoa has been the backbone of StarKist's sales. Ecuador has not. In 
the past 25 years, StarKist and Chicken of the Sea have exported more 
than $6 billion worth of tuna from American Samoa to the United States. 
Thanks to American Samoa, StarKist is the number one brand of tuna in 
the world today. They call him ``Charlie, the Tuna.'' Well, I do not 
know about Charlie the Tuna these days with the way they are operating.
  Mr. Speaker, why is it that StarKist and its parent company, Heinz 
Corporation, are willing to allow tuna imports to coming into the U.S. 
duty free from other Andean countries, a position opposed by two other 
major U.S. tuna companies and even the entire U.S. tuna-fishing fleet? 
As StarKist testified at a recent Senate hearing, and I quote, 
``StarKist will continue to can and sell tuna. However, the history of 
tuna canning in the United States and Puerto Rico has demonstrated 
quite clearly that StarKist will also take whatever action is required 
to remain cost competitive.''
  Is this why StarKist and Heinz Corporation support a trade agreement 
that the entire U.S. industry opposes? Will StarKist and Heinz 
Corporation sell out America at a time when our Nation is in recession 
and our country is under attack?
  Mr. Speaker, I trust that the Members of this esteemed body will do 
what is right for America. I trust that in these difficult times 
Members of this body will protect U.S. industries and U.S. workers, 
particularly the tuna industry. I trust that we will stand united 
together to exclude canned tuna from this proposed bill, H.R. 3009.

[[Page 18951]]

  I would like to share with my colleagues some additional information 
that was submitted to me by my good friend, the CEO of the Bumble Bee 
Seafood Company out of California, in San Diego. Another note to my 
colleagues:
  The Andean Pact nations do not comply with many of the environmental 
regulations supported by the United States. For instance, one of the 
Andean Pact countries, Bolivia, does not adhere to the dolphin-safe 
position of the U.S. market. In addition, many of the Andean Pact 
countries refuse to take enforcement actions against them.
  The bill also penalizes the U.S. tuna industry for being American. 
Not only do we adhere to minimum wage standards and provide Social 
Security and medical insurance for our workers, we also enforce U.S. 
regulations regarding the environment and trade.
  The letter says, ``I support the U.S. initiative to battle the drug 
trade.'' We all know that, Mr. Speaker. But I think what is most 
important here is that I am making an appeal to StarKist Tuna Company 
and its parent company, Heinz Food Corporation, to join with the rest 
of the U.S. tuna industry to make the U.S. tuna industry a viable and 
credible industry in our country for the sake of some 10,000 workers 
who are about to lose their jobs if the Congress does the bidding of 
Heinz Corporation.
  I think this is most unfair, Mr. Speaker; and I will continue working 
on this issue in the coming weeks and months. I sincerely hope that 
there will be a reasonable and an equitable solution to this problem 
that we now have.
  Mr. Speaker, I submit for the Record the full letter from the CEO of 
the Bumble Bee Seafood Company, to which I earlier referred.

                                          Bumble Bee Seafoods,

                                   San Diego, CA, August 22, 2001.
     Hon. Eni F. H. Faleomavaega,
     Rayburn Bldg.,
     Washington DC.
       Dear Congressman Faleomavaega: I am writing on behalf of 
     Bumble Bee Seafoods, the number one brand of canned seafood 
     and number two brand of canned tuna in the United States. 
     Bumble Bee, the only American company with a financial 
     investment in the Andean tuna industry (in Ecuador), along 
     with Chicken of the Sea and U.S. tuna boat owners, strongly 
     oppose the granting of NAFTA status for canned tuna products 
     to members of the Andean Pact as contemplated in S525.
       The U.S. tuna industry has been an essential part of the 
     U.S. economy for close to 100 years. We currently provide 
     more than 10,000 jobs in California, Puerto Rico and American 
     Samoa. In addition, we support an even greater number of jobs 
     in related industries and we underpin the existence of the 
     U.S. high seas tuna fishing fleet that operates throughout 
     the Pacific Ocean.
       From a consumer standpoint, canned tuna represents the 
     third fastest moving product category in the entire U.S. 
     grocery business and provides a high quality, affordable 
     source of protein for 96% of U.S. families.
       As written, S.525 would significantly damage the U.S. tuna 
     industry, threatening jobs in both the processing and fishing 
     sector. More importantly, it would place our business into 
     foreign hands and benefit countries that do not abide by the 
     same environmental, labor and safety standards imposed on 
     U.S. manufacturers. S525 penalizes the U.S. tuna industry for 
     being American and does an injustice to the U.S. consumer. 
     Let me give you some key facts:
       The Andean Pact nations do not comply with many of the 
     environmental regulations supported by the United States. For 
     instance, one of the Andean Pact countries, Bolivia, does not 
     adhere to the dolphin safe position of the U.S. market. In 
     addition, many of the Andean Pact countries refuse to take 
     enforcement action against their flag vessels which have been 
     found to be in violation of IATTC, (Inter American Tropical 
     Tuna Commission) fishing regulations. These actions--or lack 
     of action--threaten the conservation of the tuna stocks.
       U.S. Trade policy already provides beneficial access to the 
     U.S. market for the Andean Pact countries through the sale of 
     frozen tuna `loins'. The current import duty on tuna loins 
     into the United states is less than one half of one percent, 
     which is virtually zero. This trade policy has enabled the 
     Andean Pact tuna industry to explode over the last ten years 
     and supports our position that tuna should continue to be 
     exempted from the Andean Trade Preference Agreement.


             Andean Pact Tuna Industry Growth--1990 to 2000

       Number of tuna factories has increased from 7 to 23, up 
     229%; production capacity has increased from 450 to 2,250 
     tons per day, up 400%; direct employment has increased from 
     about 3,500 to 12,500, up 257%; exports to the U.S. have 
     grown from about $15 million to more than $100 million, up 
     567%; European exports are up even more significantly; the 
     Andean fishing fleet has grown to the largest in the ETP and 
     now represents more than 35% of the ETP catch.
       To put this capacity in perspective, there is enough 
     production capacity in the Andean Pact countries to supply 
     the entire U.S. market. This leads to the real risk of 
     product dumping which will damage the domestic tuna industry. 
     This Andean Pact product is manufactured utilizing labor 
     costs of less than $0.70/hour and a cost structure that is 
     subsidized by their various governments. This will force the 
     closure of U.S. tuna processing facilities and will decimate 
     the economies of western Puerto Rico and American Samoa where 
     85% of public sector employment is based on the U.S. tuna 
     industry.
       The risk of product dumping has already been experienced by 
     our NAFTA trading partner to the south, Mexico. Mexico 
     recently imposed a 23% import duty on canned tuna products 
     from one of the Andean Pact nations, Ecuador, due to product 
     dumping.
       S. 525 is not reciprocal. The bill provides NAFTA duty 
     benefits to the United States market while the Andean Pact 
     countries continue to enforce trade barriers against the U.S. 
     tuna industry by imposing import duties on U.S. produced 
     canned tuna as follows: Ecuador, 20%; Colombia, 20%; Peru, 
     12%; Bolivia, 10%; Venezuela (a possible addition to the 
     Andean Pact), 20%.
       This non-reciprocity also extends to other U.S. produced 
     products that are essential to the processing of canned tuna 
     such as empty cans, packaging and ingredients which are 
     subject to import duties by the Andean Pact countries.
       The bill penalizes the U.S. tuna industry for being 
     American. Not only do we adhere to minimum wage standards and 
     provide social security and medical insurance for our 
     workers, we also enforce U.S. regulations regarding the 
     environment and trade. Providing NAFTA trade benefits to the 
     Andean Pact countries awards them for not complying with 
     these policies.
       S. 525 ignores the obligation we have to the U.S. consumer 
     since the quality and food safety standards of many of the 
     tuna processing facilities in the Andean Pact countries are 
     not up to the same standards utilized by U.S. canned tuna 
     processors.
       To support the U.S. initiative to battle the drug trade, 
     Bumble Bee has already established tuna loining operations in 
     one of the Andean Pact countries. Ecuador. We are the only 
     American company that has invested in Andean Pact region--
     close to $25 million--and we currently provide more than 
     2,000 jobs.
       Yet despite our presence in Ecuador, Bumble Bee does not 
     support S. 525 due to the negative ramifications we have 
     highlighted in this letter.
       In summary, S. 525 does not recognize the current tariff 
     benefits on tuna products enjoyed by Andean Pact countries, 
     ignores the tariff recently imposed on tuna products from 
     Ecuador by our primary NAFTA trading partner, will lead to 
     ``dumping'' that will in turn cause significant harm to the 
     U.S. tuna industry and has significant potential to have 
     negative consequences on the American consumer.
       We therefore urge you to exempt canned tuna products from 
     the scope of trade benefits offered by S. 525. There is no 
     justification for granting such trade benefits at this time.
       I would like to meet with you to discuss this matter in 
     more detail. I can be reached by phone, e-mail or mail and am 
     happy to travel to Washington to provide any other facts or 
     information that can help you make an informed and 
     responsible decision on this critical piece of trade 
     legislation.
       Thank you in advance for your support.
           Very truly yours,

                                       Christopher Lischewski,

                               President, Chief Operating Officer,
     Bumble Bee Seafoods.

                          ____________________