[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