    [Weekly Compilation of Presidential Documents Volume 30, Number 16 (Monday, April 25, 1994)]
    [Pages 872-873]
    [Online from the Government Publishing Office, www.gpo.gov]

    <R04>
    Memorandum on Trade With China

    April 21, 1994

    Memorandum for the United States Trade Representative

    Subject: Import Relief Determination Under Section 406 of the Trade Act
    of 1974 on Honey from the People's Republic of China

        Pursuant to section 406 of the Trade Act of 1974 (19 U.S.C. 2436)
    and sections 202 and 203 of the Trade Act of 1974 (as those sections
    were in effect on the day before the date of the enactment of the
    Omnibus Trade and Competitiveness Act of 1988), I have de-
    termined the action I will take with respect to the affirmative
    determination of the Unit-
    ed States International Trade Commission

    [[Page 873]]

    (USITC), on the basis of its investigation (No. TA-406-13), that market
    disruption exists with respect to imports from China of honey provided
    for in heading 0409 and subheadings 1702.90 and 2106.90 of the
    Harmonized Tariff Schedule of the United States.
        After considering all relevant aspects of the investigation,
    including those set forth in section 202(c) of the Trade Act of 1974, I
    have determined that import relief for honey is not in the national
    economic interest of the United States. However, I am directing the
    United States Trade Representative (USTR), in consultation with the
    appropriate agencies, to develop a plan to monitor imports of honey from
    China. The monitoring program is to be developed within thirty days of
    this determination.
        In determining not to provide relief, I considered its overall costs
    to the U.S. economy. The USITC majority recommendation for a quarterly
    tariff rate quota (a 25 percent ad valorem charge on the first 12.5
    million pounds each quarter, increasing to 50 percent on amounts above
    that level), to be applied for three years, would cost consumers about
    $7 million while increasing producers' income by just $1.9 million.
    Overall, national income would be reduced by approximately $1.2 million.
    The other forms of relief recommended by other Commissioners would also
    result in substantial costs to consumers while offering little benefit
    to producers and reducing national income.
        In addition, the gap between production and consumption in the
    United States is approximately 100 million pounds, with imports of honey
    from China helping to fill that gap at the low end for industrial use.
    Any restrictions on imports of honey from China would likely lead to
    increased imports from other countries rather than significantly
    increased market share for U.S. producers.
        Although rising somewhat since 1991, U.S. honey inventories are not
    large by historical experience, either in absolute amounts or relative
    to consumption. Honey stocks reported by the U.S. Department of
    Agriculture were much higher in the mid-1980's (about 75 percent of
    consumption in 1985 and 1986), before falling to their lowest level in a
    decade in 1991 (26.6 percent of consumption). 1993 stocks were 37.8
    percent of consumption, well below the 1980-1993 average level of 46.4
    percent.
        The U.S. government has supported honey producers since 1950, in
    part, to ensure enough honeybees would be available for crop
    pollination. This is an important national interest. I believe that
    current trends in the provision of pollination and honey production will
    not be significantly affected by not providing relief. Crop producers
    indicate that they believe pollination will still be cost effective even
    if service prices rise.
        I have also concluded that, in this case, imposing trade
    restrictions on imports of honey would run counter to our policy of
    promoting an open and fair international trading system.
        This determination is to be published in the Federal Register.
                                                William J. Clinton