[Federal Register Volume 63, Number 106 (Wednesday, June 3, 1998)]
[Presidential Documents]
[Pages 30363-30364]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-14932]


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                         Presidential Documents 
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  Federal Register / Vol. 63, No. 106 / Wednesday, June 3, 1998 / 
Presidential Documents  

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 Title 3--
 The President

[[Page 30363]]

                Memorandum of May 30, 1998

                
Action Under Section 203 of the Trade Act of 1974
                Concerning Wheat Gluten

                Memorandum for the Secretary of the Treasury[,] the 
                Secretary of Agriculture[, and] the United States Trade 
                Representative

                On March 18, 1998, the United States International 
                Trade Commission (USITC) submitted to me a report that 
                contained: (1) a determination pursuant to section 202 
                of the Trade Act of 1974 (19 U.S.C. 2252) (the ``Trade 
                Act'') that imports of wheat gluten are being imported 
                into the United States in such increased quantities as 
                to be a substantial cause of serious injury to the 
                domestic industry; and (2) negative findings made 
                pursuant to section 311(a) of the North American Free 
                Trade Agreement Implementation Act (the ``NAFTA 
                Implementation Act'') (19 U.S.C. 3371(a)) with respect 
                to imports of wheat gluten from Canada and Mexico.

                After considering all relevant aspects of the 
                investigation, including the factors set forth in 
                section 203(a)(2) of the Trade Act (19 U.S.C. 2253), I 
                have implemented actions of a type described in section 
                203(a)(3). Specifically, I have determined that the 
                most appropriate action is a quantitative limitation on 
                imports of wheat gluten. I have proclaimed such action 
                for a period of approximately 3 years in order to 
                provide time for the domestic industry to implement an 
                adjustment plan that will facilitate its positive 
                adjustment to import competition. I have set the 
                quantitative limitation at an amount equal to 126.812 
                million pounds in the first year, an amount which 
                represents total average imports in the crop years 
                ending June 30, 1993, through June 30, 1995. This 
                amount will increase by six percent annually for the 
                duration of the relief period. I believe that this 
                amount is the relief necessary to remedy the serious 
                injury and to promote positive adjustment. The quota is 
                allocated based on average import shares in the period 
                covered by the crop years ending June 30, 1993, through 
                June 30, 1995. Shares of countries excluded from the 
                quota are assigned on a pro rata basis to countries 
                subject to the quota. To ensure that the quota is 
                substantially filled, I have authorized the United 
                States Trade Representative to reallocate any 
                significant unused quota allocations. I considered 
                taking other forms of action, such as increasing 
                tariffs on imports of wheat gluten, and have determined 
                that action in such forms would not, in light of the 
                nature of trade in wheat gluten, meet the goals of 
                remedying serious injury and facilitating industry 
                adjustment.

                I agree with the USITC's findings under section 311(a) 
                of the NAFTA Implementation Act, and therefore 
                determine, pursuant to section 312(a) of the NAFTA 
                Implementation Act, that imports of wheat gluten 
                produced in Canada do not contribute importantly to the 
                serious injury caused by imports and that imports of 
                wheat gluten produced in Mexico do not account for a 
                substantial share of total imports of such wheat 
                gluten. Therefore, pursuant to section 312(b) of the 
                NAFTA Implementation Act, the quantitative limitation 
                will not apply to imports of wheat gluten from Canada 
                or Mexico. Similarly, the limitation will not apply to 
                imports of wheat gluten from Israel, and beneficiary 
                countries under the Caribbean Basin Economic Recovery 
                Act (CBERA) and the Andean Trade Preference Act (ATPA), 
                in light of the USITC's statement that its 
                recommendation does not apply to imports from those 
                countries. Moreover, other developing countries that 
                have ac-

[[Page 30364]]

                 counted for a minor share of wheat gluten imports are 
                excluded from the quantitative limitation.

                As an additional means of arriving at a long-term 
                solution to this trade issue, I have directed the 
                United States Trade Representative, with the assistance 
                of the Secretary of Agriculture, to seek to initiate 
                international negotiations to address the underlying 
                cause of the increase in imports of the article or 
                otherwise to alleviate the injury found to exist.

                I have determined that the actions described above will 
                facilitate efforts by the domestic industry to make a 
                positive adjustment to import competition and provide 
                greater economic and social benefits than costs. This 
                action provides the domestic industry with necessary 
                temporary relief from increased import competition, 
                while also assuring our trading partners significant 
                continued access to the United States market.

                I also note that, pursuant to section 204 of the Trade 
                Act, the USITC will monitor developments with respect 
                to the domestic industry, including progress and 
                specific efforts made by workers and firms in the 
                domestic industry to make a positive adjustment to 
                import competition, and will provide to me and to the 
                Congress a report of its monitoring no later than the 
                date that is the midpoint of the period the action is 
                in effect.

                The United States Trade Representative is authorized 
                and directed to publish this determination in the 
                Federal Register.

                    (Presidential Sig.)

                THE WHITE HOUSE,

                    Washington, May 30, 1998.

[FR Doc. 98-14932
Filed 6-2-98; 8:45 am]
Billing code 3190-01-P