United States: Recent Economic Developments

This paper reviews economic developments in the United States during 1992–96. The paper briefly describes improvements in the national income and product accounts (NIPA) and some of their implications for the analysis of long-term trends in U.S. investment and saving. The paper highlights that the effect of the 1990–92 recession on employment was considerably less severe than the effect of the 1981–82 recession. During the 1990–92 recession, employment fell by 1½ percent, compared with a drop of 3 percent during the 1981–82 recession.


This paper reviews economic developments in the United States during 1992–96. The paper briefly describes improvements in the national income and product accounts (NIPA) and some of their implications for the analysis of long-term trends in U.S. investment and saving. The paper highlights that the effect of the 1990–92 recession on employment was considerably less severe than the effect of the 1981–82 recession. During the 1990–92 recession, employment fell by 1½ percent, compared with a drop of 3 percent during the 1981–82 recession.

VI. International Trade and Investment Policies

1. Introduction

This chapter reviews developments in U.S. international trade and investment policies since July 1995, including selected aspects of: (1) implementation of the Uruguay Round agreement; (2) the Free Trade Agreement of the Americas and the North American Free Trade Agreement; (3) the Asia-Pacific Economic Cooperation Forum; (4) import policies and measures; (5) developments under Section 301 and special 301; (6) trade preferences for developing countries; (7) foreign investment policies; and (8) other trade measures and issues.

2. The Uruguay Round Agreement and the World Trade Organization (WTO)

a. Implementation of the Uruguay Round Agreement

While the United States continued to fulfill its liberalization commitments under the Uruguay Round Agreement on Agriculture, it notified the WTO of the U.S. use of price-based special safeguards on 24 agricultural products during 1995. 1/ In addition, the United States Trade Representative (USTR) on July 19, 1995 announced requests for formal WTO consultations with the European Union (EU) concerning use of reference prices as a basis for customs valuation for EU imports of rice, wheat, barley, corn, and sorghum. The USTR and the European Commission reached an agreement on November 29, 1995 that provided for reduced EU import charges on rice and for review and consultation on the implementation of the EU’s reference price system for all grains.

The United States also continued to fulfill its commitments under the Textiles and Clothing Agreement. The United States has integrated 16 percent of textile and clothing products (based on the 1990 level of imports) into the GATT (1994), none of which had been previously subject to restrictions. During 1995, the United States imposed temporary safeguards on 24 textile products. 2/

The deadline for improving, modifying, or withdrawing specific commitments on financial services, under the auspices of the General Agreement on Trade in Services, and for finalizing most-favored-nation (MFN) exemptions had been specified as June 30, 1995. The deadline was extended to July 28, 1995 following the United States’ withdrawal of its offer to provide MFN treatment to foreign financial services providers. U.S. authorities explained that this action was taken because offers made by other countries, especially in Asia, were considered to be insufficient. An interim financial services agreement, that does not include the United States, was ratified by the WTO Committee on Trade in Financial Services on July 28, 1995. The interim agreement will be in effect from August 1, 1996 through December 1997.

The deadline for negotiations to liberalize the basic telecommunications sector were not concluded by end-April 1996 as specified in the Uruguay Round Decision on Negotiations on Basic Telecommunications. The USTR cited the absence of a critical mass of quality offers from trading partners as the reason for a U.S. decision to withdraw its offer and to support an extension of negotiations to February 15, 1997. The United States had offered in February 1996 to open virtually all local phone service to foreign competition and permit foreign officers and directors of companies to receive U.S. radio licenses. However, some trading partners had noted that U.S. restrictions would remain on ownership of mobile and satellite communication systems and of underwater cables.

Negotiations on maritime transport services, scheduled for conclusion by end-June 1996, broke down following the U.S. announcement on May 24, 1996 that it would not put forward an offer due to what it characterized as serious deficiencies in offers by other countries. 1/

b. Dispute settlement activity in the WTO

By end-May 1996, 37 requests had been made to the WTO Dispute Settlement Body for consultations. Six of the 37 requests concerned alleged practices of the United States, while 14 of the complaints were made by the United States (jointly with other WTO members in several cases).

Disputes brought to the WTO concerning U.S. policies included the following cases: (i) two separate cases brought by Brazil and Venezuela concerning standards for reformulated and conventional gasoline (see below); (ii) threatened unilateral increases in U.S. import tariffs on Japanese cars; (iii) U.S. application of transitional safeguards on imports of cotton and man-made fiber underwear from Costa Rica; and (iv) two separate cases brought by India concerning U.S. application of transitional safeguards on imports of women’s and girls’ wool coats and on woven wool shirts and blouses.

On January 23, 1995, the United States received a request from Venezuela to hold consultations concerning the rule issued on December 15, 1993 by the U.S. Environmental Protection Agency (EPA), entitled “Regulation of Fuels and Fuel Additives - Standards for Reformulated and Conventional Gasoline.” Following consultations that failed to resolve the dispute, Venezuela requested on March 25, 1995 that the WTO Dispute Settlement Body (DSB) establish a panel. Brazil held consultations with the United States concerning the EPA rule on May 1, 1995, but this did not satisfactorily resolve the matter. Consequently, Brazil requested that the DSB form a panel on May 19, 1995. The DSB decided, with agreement of all the parties, to examine Brazil’s complaints within the panel already established at Venezuela’s request. Both complaints alleged that the U.S. EPA rules on reformulated gasoline treated imports less favorably than domestically produced gasoline. The panel issued its report on January 29, 1996, and it was adopted on May 20, 1996. The panel concluded that U.S. environmental rules regarding reformulated gasoline were inconsistent with the national treatment obligation of the WTO. The panel pointed out that the U.S. EPA could have formulated the rules in a way that would have been consistent with the agency’s environmental objectives and with the obligation to provide national treatment to gasoline imports.

Complaints made by the United States under WTO dispute settlement procedures include the following: (i) Korean testing and inspection requirements for agricultural imports; (ii) Korean measures restricting the shelf-life of imported products (settlement was notified to the WTO on July 31, 1995); (iii) Japanese taxes on imported alcoholic beverages; (iv) the EU’s use of reference prices for cereal imports; (v) alleged discrimination by Japan against European suppliers in the context of the U.S.-Japan bilateral agreement on sales of telecommunications equipment (jointly with the EU); (vi) two complaints related to the EU’s banana regime (jointly with Ecuador, Guatemala, Honduras, and Mexico); (vii) Australia’s import ban on salmonids for health reasons (jointly with Canada); (viii) the EU’s ban on imports of beef containing growth hormones; (ix) Japanese intellectual property rights protection for sound recordings produced before 1970; (x) Canadian restrictions on imported periodicals; (xi) Hungarian agricultural export subsidies alleged to have exceeded WTO commitments; (xii) patent protection for pharmaceuticals and agricultural chemicals by Pakistan; and (xiii) allegedly deficient patent protection by Portugal. All of these complaints were still being considered by the WTO at end-June 1996, although apparent settlements have been reached in bilateral consultations in the case of EU reference prices on cereal imports and in the case of Japanese practices affecting the sale of telecommunications equipment.

3. Free Trade Area of the Americas (FTAA) and the North American Free Trade Agreement (NAFTA)

The United States endorses the commitment to create a “Free Trade Area of the Americas” (FTAA) by 2005, which was agreed to by the 34 nations at the Summit of the Americas held in Miami in December 1994. The FTAA is intended to build on NAFTA and other regional trade agreements to broaden and deepen economic integration in the Western Hemisphere. It is intended to be fully consistent with WTO provisions. A preparatory framework was put in place with the establishment of seven working groups at the FTAA Trade Ministerial Summit held in Denver in June 1995. 1/ The Trade Ministerial meeting held in Cartagena, Colombia on March 21, 1996 endorsed the work program and agreed to strengthen the commitment to conclude negotiations no later than 2005 and to make concrete progress toward the attainment of the FTAA before the end of the century. However, the decision on when formal discussions would commence was deferred. The conclusions and recommendations of the existing working groups are to be presented in 1997 with a view to identifying possible strategies for formal negotiations. Three additional working groups were established in the following areas: government procurement, intellectual property rights, and services and competition policy. It was also agreed to establish a working group and the terms of reference for dispute settlement procedures at the next Ministerial Meeting in 1997.

Formal negotiations on Chile’s accession to NAFTA were initiated in Toronto on June 7, 1995. At the request of the Chilean authorities, however, continuing negotiations will await passage by the U.S. Congress of fast-track negotiating authority. In January 1996, Canada and Chile began negotiations on an interim bilateral trade accord, which is to be consistent with the ultimate aim of NAFTA accession for Chile.

Regarding developments in trade dispute settlements under NAFTA, the U.S. tariff-rate quotas on certain imports of wheat from Canada provided for under the U.S.-Canada Memorandum of Understanding on Grains were allowed to expire as scheduled on September 11, 1995. The United States plans to monitor Canadian grain exports closely, to consult with Canada to discuss potential problems, and to resort to appropriate U.S. trade laws if it appears that market disruption is likely.

In a long running dispute between the United States and Canada over softwood lumber, an agreement in principle was reached on February 16, 1996, which, with modifications, became effective from April 1. The main provision of the five-year agreement is that Canada would limit its exports of softwood lumber through the use of a tariff-rate quota, and the United States would refrain from using its trade-remedy laws (antidumping and countervailing duties) while the agreement is in effect. 2/ Under the agreement, all Canadian lumber exports will require export permits, so that both countries can track their origin and volumes.

The United States made the first request for a panel under Chapter 20 of the NAFTA for the purpose of examining Canada’s application of tariff-rate quotas (with tariff rates up to 350 percent for imports above certain target levels) to dairy, poultry, and egg products effective January 1, 1995. This request followed bilateral consultations first requested in February 1995 and a June 7, 1995 meeting of the NAFTA Commission. The issue is whether these tariffs—which were adopted as a result of the Uruguay Round Agreement on Agriculture—are in violation of the NAFTA, which provides for eventual elimination of tariffs and prohibits the imposition of new tariffs. The matter is still under consideration.

A NAFTA dispute settlement panel set up under Chapter 19 ruled on August 30, 1995 that Mexico in August 1994 improperly imposed antidumping duties of 76 percent and 46.18 percent against imports of cut-to-length steel plate from USX Corporation and Bethlehem Steel Corporation. This was one of the first two appeals filed with the Mexican Section of the NAFTA Secretariat seeking formation of a dispute settlement panel under Article 1904 of the NAFTA. 1/

On July 12, 1995, the Mexican section of the NAFTA Secretariat announced that it would convene a dispute resolution panel to review U.S. rulings-against Mexican cement, as provided for under Chapter 19 of the NAFTA. The dispute concerns a finding by the U.S. International Trade Commission (USITC) that the cement industry in some regions of the United States was injured by dumped Mexican imports. Mexico has argued that U.S. cement makers have been unable to keep up with domestic demand. In the event, consultations were held under Chapter 20 of the NAFTA but, as of late June 1996, there had been no request to take the next step and request consideration by the cabinet-level Free Trade Commission.

Consultations between the United States and Mexico continued regarding express delivery companies. On April 26, 1995, the USTR requested consultations under the dispute-settlement mechanism of NAFTA, claiming that Mexico had failed to provide national treatment to U.S. express delivery companies. These companies allege that they have been denied licenses to operate large trucks in Mexico and that customs procedures are burdensome. There have been consultations, and the issue was considered by the Free Trade Commission in June 1995, but the United States has not yet requested formation of a panel.

The tripartite working groups charged with reviewing the rules governing antidumping (AD) and countervailing (CVD) duties and subsidies within the NAFTA and with making recommendations for revised NAFTA rules, have completed their work. The working groups concluded at end-1995 with two understandings, the details of which have not yet been made public.

The NAFTA provides for establishment of Secretariats in the areas of labor (based in Dallas), the environment (based in Montreal), and trade (to be based in Mexico City). In addition, the Border Environmental Cooperation Commission (BECC), created in November 1993 under the environmental provisions of the NAFTA to help clean up the U.S.-Mexico border region, approved its first set of infrastructure projects on September 28, 1995. Projects certified by the BECC are forwarded to the North American Development Bank (NADBank), the latter having been funded in equal parts by the United States and Mexico. The NADBank provides only partial funding for the projects; the remainder is funded from private or other government sources.

4. Asia-Pacific Economic Cooperation Forum (APEC)

At the APEC meeting in Bogor, Indonesia in November 1994, member countries issued a “Declaration of Common Resolve” to achieve “free and open trade and investment” by 2020, and for the more industrialized countries by 2010. On November 17, 1995, the 18 member-nations of APEC endorsed an “Action Agenda” to achieve this objective. 1/ The Action Agenda is subdivided into two parts: part one provides for a framework to facilitate and liberalize trade and investment, including actions in specific areas; and part two calls for increased economic and technical cooperation through, inter alia, infrastructure development, human resource development, and finance and exchange rate coordination. 2/

“Initial Actions” were submitted by each country on tariffs and nontariff barriers, which in most cases represented a restatement or acceleration of previous commitments undertaken either unilaterally or under the Uruguay Round. The U.S. statement of initial actions included implementation in 1995 of the Customs Modernization Act, Federal Procurement Streamlining, Export Administration Regulations, and the Paperwork Reduction Act. Each member country is expected to submit more substantive proposals during the 1996 APEC Ministerial Meeting at Subic Bay in the Philippines. Members are expected to submit unilateral liberalization plans in 15 specific areas, and following an initial comparison, these “Action Plans” will be tabled at the Philippine Summit, with implementation and review to begin in 1997. 3/

5. Import policies and measures

The USTR released its annual Title VII review of foreign-government procurement practices on April 30, 1996. 1/ Germany was cited as having failed to comply fully with the terms of a 1993 Memorandum of Understanding (MOU). 2/ No other countries were identified under the 1996 Title VIII review.

The USTR raised a number of issues in its 1996 Title VII review. The report noted Administration initiatives in the OECD and the WTO to increase transparency and reduce “corruption” in government procurement. Cited as a matter of “concern” were certain discriminatory practices in four countries in the area of information technology. Australia was cited for alleged discriminatory practices in information technology and telecommunications; Brazil for discriminatory practices in telecommunications; China for nontransparent procurement practices; and Japan for discriminatory government procurement practices in public works, supercomputers, and computers.

During 1995, the U.S. Department of Commerce and the USITC reviewed 16 AD and 2 CVD petitions, compared with 41 AD and 6 CVD petitions in 1994. Twenty three new AD orders (not including suspension agreements) 3/ and two new CVD orders were imposed.

One petition for escape-clause protection was filed on March 29, 1995 under Section 201 of the 1974 Trade Act. 1/ The petition, which concerned imports of fresh winter tomatoes, requested provisional as well as longer-term relief. In the event, the USITC made a negative provisional relief determination, the petition was withdrawn, and the investigation was terminated. On March 11, 1996, another petition was filed under Section 201 to investigate whether surges in U.S. imports of Mexican tomatoes and peppers had seriously injured the U.S. industry. The USITC ruled on July 2, 1996 that the industry had not been seriously injured by imports and the case was terminated.

6. Developments under Section 301 and special 301 2/

On September 28, 1995, the USTR issued its 1995 “super 301” report to Congress under the executive order that reinstated super 301 in 1994. 3/ No “priority foreign country practices” were identified, but under the “early warning” provisions, it was noted that the following practices may warrant identification in the future: (i) market access for wood and paper imports in Japan; and (ii) market access for agricultural products in China. On September 27, 1995, the President extended the reinstated super 301 through end-1997.

On April 30, 1996, the USTR released its 1996 special 301 decision, announcing that China had been identified as a “priority foreign country.” 4/ Argentina, the EU, Greece, India, Indonesia, Japan, Korea, and Turkey were placed on the “priority watch list,” with two countries—Argentina and Greece—subject to out-of-cycle reviews later in the year. 1/ The “watch list” now includes 25 countries with seven—El Salvador, Italy, the Philippines, Paraguay, Russia, Saudi Arabia, and Thailand—subject to out-of-cycle reviews. 2/ It also was announced that WTO dispute settlement procedures would be invoked with respect to practices in India, Pakistan, Portugal, and Turkey. An additional five countries—Bolivia, Bulgaria, Hong Kong, South Africa, and Taiwan—will be evaluated during the course of the year in out-of-cycle reviews.

Four Section 301 investigations have been initiated since July 1995. These included investigations related to the EU’s restrictions on banana trade, related investigations of Colombia’s and Costa Rica’s banana export regimes, Japan’s practices in the market for photographic film and paper, and compensation for tariff increases by Austria, Finland, and Sweden due to their accession to the EU.

a. China

Following the unsuccessful conclusion of consultations under the terms of a February 1995 agreement with China on protection of intellectual property rights (IPR), the USTR announced that prohibitive tariffs would be imposed on June 17, 1996 on approximately $2 billion worth of Chinese imports, if China failed to take action to improve implementation of the 1995 agreement. In the event, the USTR announced on June 17, 1996 that China had taken a “critical mass” of enforcement actions in connection with the 1995 agreement, including: steps to close 15 compact disc (CD) factories; a focused enforcement effort in regions where piracy is allegedly important; improved border enforcement to help limit exports of pirated IPR products and imports of illegal CD presses; and improved market access for U.S. audiovisual and computer software products and companies. As a result of these actions, the USTR decided not to impose sanctions.

b. Banana disputes

On September 27, 1995, the United States (together with Honduras, Guatemala, and Mexico) requested consultations with the EU, under WTO dispute settlement procedures, regarding EU restrictions on the importation, sale, and distribution of bananas, and the consistency of these restrictions with WTO rules. This was a follow-up to an earlier Section 301 investigation which alleged that EU practices discriminated against U.S. marketing and distribution companies. A WTO dispute panel was constituted on May 8, 1996.

On January 9, 1996, the USTR self-initiated separate Section 301 investigations of the practices of Colombia and Costa Rica in the exportation of bananas to the EU. These investigations are successors to an earlier Section 301 investigation, initiated January 9, 1995, that centered on a framework agreement negotiated between the EU, Colombia, Costa Rica, Nicaragua, and Venezuela that authorizes the exporting governments to issue export licenses. Such licenses are required, in addition to EU import licenses, in order to gain access to the European market. The U.S. firm, Chiquita Brands International, argued that the export licensing system was discriminatory. While the earlier investigation found that Colombia’s and Costa Rica’s banana export regimes were unfair, no sanctions were imposed because the countries agreed to work with the United States to resolve the dispute.

c. Korea

On July 20, 1995, the United States and Korea settled their dispute regarding shelf-life requirements on Korean imports of U.S. meat. Korea agreed, inter alia, to reform its shelf-life system for food products, which set more stringent shelf-life requirements than in other countries, and its system of tendering offers for pork products, which U.S. producers argued discriminated against them. As a result, the USTR ended its Section 301 investigation and its consultations under WTO dispute settlement procedures.

On June 1, 1995, U.S. pipe and tube importers filed a petition under Section 301 that alleged government restrictions on Korean exports of steel sheet and pipe and tube, as well as price controls on steel sheet. Following establishment of a consultative mechanism on July 14, 1995, the petitioners withdrew their petition.

d. Canada

On February 6, 1995, the USTR initiated a Section 301 investigation concerning the Canadian decision to end the distribution rights in Canada of U.S.-owned Country Music Television (CMT). Following the threat of sanctions, the USTR announced a tentative agreement on June 22, 1995, which provided for the formation of a single Canadian country music network, including CMT and the Canadian New Country Network. In the event, negotiations still had not been finalized by February 6, 1996, the time the USTR had to make a determination under Section 301. The USTR ruled that the Canadian broadcasting practices under investigation denied national treatment and market access and were discriminatory. In view of ongoing negotiations, the USTR did not announce retaliatory measures. On March 7, 1996, the USTR announced that CMT and the New Country Network had signed an agreement to form a single Canadian country music network.

e. Japan

On July 2, 1995, the USTR initiated an investigation under Section 301 regarding the $2.8 billion a year film and photographic paper market in Japan. This investigation was initiated in response to a request by Eastman Kodak Company, which alleged that exclusionary business practices of Fuji Photo Film, Ltd. and others had restricted access of U.S. photographic products companies to the Japanese market. On June 13, 1996, the USTR found evidence of unreasonable practices by the Government of Japan regarding the distribution and sale of consumer photographic materials in Japan. On this basis, the USTR decided to request three separate WTO consultations concerning: (i) nullification and impairment of GATT benefits; (ii) violation of the General Agreement on Trade in Services arising from Japan’s Large Scale Retail Store Law; and (iii) evidence of anticompetitive activity in relation to a GATT decision on restrictive business practices.

f. EU enlargement

With the accession of Austria, Finland, and Sweden to the EU on January 1, 1995 and the consequent adoption of the EU’s trade regime, MFN tariffs in these countries were raised in some cases beyond bound levels under the GATT/WTO. In line with GATT/WTO rules, U.S. negotiations with the EU on compensation (typically in the form of other tariff cuts) resulted in a six-month interim agreement announced on January 4, 1995, which expired on June 30, 1995. On October 24, 1995, the USTR self-initiated a Section 301 investigation related to accession of Austria, Finland, and Sweden to the European Union. An agreement was reached with the EU on November 28, 1995 that compensates the United States for the increases in tariffs.

7. Trade preferences for developing countries

Operation of the Generalized System of Preferences (GSP), which grants preferential duty treatment on specified products to designated developing countries, was suspended as of August 1, 1995, and the Congress has not voted to extend authority for this program. GSP beneficiaries have not received preferential duty treatment since that date. Efforts are underway to renew operation of the program.

8. Foreign investment

a. Exon-Florio provision

Foreign acquisitions, mergers, and takeovers in the United States are reviewed under the “Exon-Florio provision” of the Defense Production Act. If, after a full investigation by the Committee on Foreign Investment in the United States (CFIUS), the President determines such investments would threaten national security, the President may block them. From June 1, 1995 through mid-May 1996, 54 transactions were subject to a 30-day review, and no transactions were subject to the more comprehensive 45-day investigation. During this same period, the President did not prohibit any transactions on the basis of CFIUS investigations.

b. U.S.-Japan agreement

On July 20, 1995, the United States and Japan signed an investment arrangement that is designed to promote foreign direct investment (FDI) in Japan on a non-discriminatory basis. The measures include the following: (i) improved government facilitation of FDI through creation of an investment council; (ii) expanded Japanese government financial support for FDI (including by the Japan Development Bank); (iii) improved tax incentives for FDI (e.g., extension of the loss carry-forward period from seven to 10 years); (iv) accelerated deregulation, reduced prior notification requirements, and joint U.S./Japan efforts to liberalize FDI in both the OECD and APEC; (ν) efforts to promote foreign participation in mergers and acquisitions; (vi) increased land availability, including through financial incentives; (vii) help for foreign firms to recruit and retain qualified workers; and (viii) assistance for foreign firms with buyer-supplier relations.

9. Other measures and issues

At the first plenary meeting of the Wassenaar Arrangement 1/ during April 2-3, 1996 in Vienna, Austria, discussions among the United States and other member countries to implement the agreement broke down. In particular, agreement could not be reached on a provision requiring all member countries to notify other members of any transfers of sensitive goods or technology (including certain machine tools, computers, and telecommunications equipment) previously denied by another member. Work will continue to resolve this issue prior to the next meeting, scheduled for July 11-12, 1996.

On March 12, 1996, the President of the United States signed into law the Cuban Liberty and Democratic Solidarity Act (also known as the Helms-Burton Law). Effective August 1, 1996, the law provides, inter alia, recourse for U.S. citizens to the U.S. courts in pursuing their claims regarding property confiscated by the Cuban government. It also denies visas to those who have confiscated, converted, or trafficked in such property (which may apply to corporate officers or shareholders in companies that have invested in Cuba). The extraterritorial nature of the law has provoked opposition from a number of countries. Canada and Mexico have requested consultations under Chapter 20 of the NAFTA; these consultations are ongoing. The EU on May 3, 1996 formally requested consultations under the WTO dispute settlement rules.


The Agreement on Agriculture allows for special safeguards that can be triggered by price declines in excess of certain limits.


The Agreement on Textiles and Clothing includes provision for use of “transitional safeguards” only on products not yet integrated into GATT (1994). Such safeguards may be applied selectively to particular exporters and may be maintained for a maximum of three years and have to be phased out over their duration.


The United States maintains restrictions on U.S. maritime cabotage (domestic point-to-point service) that require the use of vessels registered and built in the United States, and owned and crewed predominantly by U.S. citizens under the Merchant Marine Act of 1920, commonly known as the Jones Act.


The working groups cover: market access; custom procedures and rules of origin; investment; standards and technical barriers to trade; sanitary and phytosanitary measures; subsidies, antidumping and countervailing duties; and a “smaller economies” group. For further information on the work program of the groups see Background Papers, Chapter IX (SM/95/181).


The tariff-rate quota applied is two-tiered—US$50 per thousand board feet for the first 650 million board feet above 14.7 billion board feet and US$100 per thousand board feet for exports above 15.35 billion board feet. No export tariff is applied to exports less than 14.7 billion board feet.


The other request was made by USX Corporation and Inland Steel Company with respect to imports of flat coated steel products.


The 18-members of APEC are Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papau New Guinea, the Philippines, Singapore, the Republic of Korea, Taiwan Province of China, Thailand, and the United States.


For further details see “Declaration for Action and The Action agenda - The Implementation of the Bogor Declaration,” APEC Economic Leaders’ Meeting, Osaka, Japan, November 19, 1995.


The 15 specific areas include: tariffs, nontariff measures, services, investment, standards and conformance, customs, intellectual property rights, competition policy, government procurement, deregulation, rules of origin, dispute mediation, mobility of business persons, Uruguay Round implementation, and information gathering.


Title VII of the 1988 Omnibus Trade and Competitiveness Act requires the USTR to submit a yearly report to Congress identifying countries that: (i) are signatories to the GATT Government Procurement Code and are in violation of their obligations; and (ii) signatories and non-signatories to the Code that show a significant and persistent pattern or practice of discrimination in government procurement against the United States with identifiable harm to U.S. businesses, where there are also significant purchases by the U.S. Government of products or services from that country. In those cases involving areas not covered by the Code, following a period of consultations the President is authorized to impose sanctions.


When the U.S.-EU dispute over the EC Utilities Directive was resolved in April 1993, no agreement was reached with respect to telecommunications procurement, and U.S. sanctions were imposed on May 28, 1993. It was announced on June 10, 1993 that the United States had reached a bilateral agreement (the MOU), in which Germany agreed not to adopt discriminatory telecommunications practices in return for excluding Germany from U.S. sanctions.


Suspension agreements occur when exporters subject to an AD investigation agree to cease exports to the United States within six months or to revise their prices upward to eliminate any alleged dumping margin. An AD investigation is renewed if exporters violate the agreement.


Section 201 of the 1974 Trade Act implements Article XIX (the Safeguards Clause) of the GATT. It allows protection, on a nondiscriminatory (MFN) basis, to a domestic industry found to be seriously injured by imports.


Section 301 of the Trade Act of 1974, as amended, may be applied to enforce U.S. rights under bilateral and multilateral trade agreements and to respond to unreasonable, unjustifiable, or discriminatory foreign government practices that burden or restrict U.S. trade. Under the “special 301” provision of the 1988 Trade Act, the USTR must identify those countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access for persons that rely on intellectual property protection.


On March 3, 1994, the President reinstated by executive order the “super 301” provision of the 1988 Trade Act, which had expired in 1990. The reinstated super 301 procedure grants discretion to USTR that was not available under the original version. It also contains an “early warning” provision intended to encourage negotiations before a country is designated as a priority foreign country and a Section 301 investigation begins.


Designation of a country as a “priority foreign country” requires initiation of a Section 301 investigation unless USTR determines that certain special circumstances prevail.


The USTR undertakes a review of foreign practices each year within 30 days after the issuance of the National Trade Estimates Report. “Out of cycle” reviews occur between annual reviews.


The 25 countries on the watch list are: Australia, Bahrain, Brazil, Canada, Chile, Colombia, Costa Rica, Ecuador, Egypt, El Salvador, Guatemala, Italy, Kuwait, Oman, Pakistan, Paraguay, Peru, Philippines, Poland, Russia, Saudi Arabia, Singapore, Thailand, United Arab Emirates, and Venezuela. Placement on the “priority watch list” or the “watch list” signals that problems exist regarding the protection or enforcement of intellectual property rights.


The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies was established in December 1995. It is based on a commitment by each country to enforce its own export laws. This arrangement complements existing multilateral export control regimes such as the Australia Group on chemical and biological weapons and the Nuclear Suppliers Group.