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Trade Benefits for Poor Countries Threatened by Congressional In-Fighting

December 07, 2006

From the Washington Post on December 5, 2006:

It shouldn't matter whether you're conservative or liberal, for globalization or against: Some trade bills are so obviously beneficial and unobjectionable that there's no excuse for letting them languish. This is the case with a raft of measures that would extend trade preferences for poor countries - preferences due to expire at the end of the year.
And today:
One of the most disputed provisions would allow some types of clothing made in Haiti to be exported to the United States tax free. The Bush administration has championed the measure as a form of aid to one of the world's poorest countries, but some trade groups have attacked it, focusing on the fact that it would allow a portion of the raw materials used in Haiti to come from other countries.
Fact: Haiti's exports in the first nine months of this year were 0.6 percent of total US imports of clothing.As a Washington Post editorial rightly pointed out earlier this week, congressional legislation extending trade preferences for developing countries should be a no-brainer. The extension of several programs is threatened this year, however, by a combination of procrastination and petty politics. Pundits are saying that this Congress will easily surpass the record of the 1948-49 body that President Harry Truman labeled the "do-nothing Congress." So extending trade preferences is just one of a long list of things left undone. But efforts to rectify that in the current lame duck may be torpedoed by political gamesmanship. For example, Senator Lindsay Graham (R-SC) has said that he would try to block the trade package over the provision expanding preferential access for Haiti, the poorest country in the hemisphere, despite the tiny amount of trade involved. Others want to use the bill to punish the governments of countries that do not toe the US line in multilateral or bilateral trade negotiations, ignoring the fact that those who would actually pay the price are the poor employed in export sectors in those countries and poor consumers in this country. Neither of the competing House and Senate bills that the leadership is currently trying to reconcile and bring to a vote are ideal, but they are better than nothing. One hopes that a compromise can be achieved before time runs out but it is a sorry spectacle either way. As the Washington Post said, is it any wonder that the United States is seen as arrogant?

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CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.

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