WHITE HOUSE SUBMITS CAFTA IMPLEMENTING
BILL, JUNE FLOOR VOTE POSSIBLE
June 24, 2005
Amid signs of negotiations on labor rights, textiles and sugar, the
White House yesterday (June 23) sent to Congress the final legislation
implementing a free trade agreement with the Dominican Republic and five
Central American countries.
This could set the stage for action in the House Ways and Means Committee as early
as June 28, sources said. Senate Finance Committee Chairman Charles Grassley
(R-IA) said this week he was planning to have a formal committee markup on June
28 or 29.
Under this timetable, the House could vote on DR-CAFTA as early as June
30, but a U.S.
trade official said on June 23 no final decisions have been made. There are
on-going discussions between the congressional leadership and the
Administration, he said.
He said the Senate seems to be more willing than the House to go to a
floor vote, probably because the vote is more certain in the Senate. But a
Democratic Senate aide said a Senate floor vote was unlikely next week.
The trade official also said with the formal implementing legislation
submitted he had no doubts that the DR-CAFTA would ultimately be passed. Under
the fast-track procedure, the House has 60 legislative days to act on the bill.
House Majority Whip Roy Blunt (R-MO) did not mention the possibility of
having a House floor vote next week during a June 23 meeting with business
lobbyists supporting DR-CAFTA. At the same meeting, House Ways and Means
Committee Chairman Bill Thomas (R-CA) said he wants to move as quickly as
possible and in close coordination with the Senate but without mentioning a
timetable, sources said.
Blunt and the Deputy Whip Eric Cantor (R-VA) earlier this week told
business representatives that they had begun a formal vote count on June 21, in
the hope of having it completed this week, they said. A delay until after the
July 4 recess would give the House leadership and the administration more time
to analyze the results of the formal whip count and to determine what if any
other deals need to be made with members to secure their votes.
Opponents and supporters said last week that the votes were 20 to 30
short of passage (Inside U.S. Trade, June
17, p. 1).
Both Blunt and Thomas signaled in the June 23 meeting that legislative
business has to deal with the breaks of congressional recesses, sources said. This
may have been a signal that the vote would not occur until after the July 4
recess, one business source said.
Similarly, President Bush in a June 23 White House event called on
Congress to pass CAFTA, but did not indicate any timetable for doing so.
President Bush and other administration officials have been active this
week in meeting with undecided members of the House and Senate on DR-CAFTA. On
June 21, 14 undecided Republican House members met Bush at the White House to
discuss DR-CAFTA. Members attending included Reps. Bob Inglis (R-SC), Howard
Coble (R-NC) and Shelley Moore Capito (R-WV).
Inglis told Inside U.S. Trade
he will not vote for DR-CAFTA unless the five Central American countries and
the Dominican Republic make
a binding commitment in writing that they will not use three provisions in the
DR-CAFTA to incorporate inputs from China
into apparel that will enter the U.S. duty-free under the deal. This
commitment would cover a cumulation provision that allows Mexican fabric to be
included in DR-CAFTA garments that enter the U.S. duty-free; a tariff
preference level (TPL) for Nicaragua that allows a limited amount of third
country fabric to be included in eligible garments that would have duty-free
access to the U.S.; and non-visible pocketing and linings that.
Under the DR-CAFTA as now written, this fabric and components could be
sourced from China and other
countries for DR-CAFTA garments that would get duty-free access in the U.S.
These three provisions were covered in an agreement the administration
worked out with the National Council of Textile Organizations to get that
groups endorsement of DR-CAFTA. In that deal, the administration
committed to seeking an agreement from the six DR-CAFTA countries that only U.S. or
regional non-visible pocketing and lining would be used in apparel that gets
The U.S. also
promised to put off implementing the cumulation provision effectively for two
years and received a commitment from Nicaragua
that the third-country fabric benefits it receives from the TPL will not reduce
fabric exports to that country (Inside U.S.
Trade, May 13. p. 1).
Inglis said U.S. Trade Representative Rob Portman in particular has
been engaged in pursing a solution to the issue and that he would likely meet
with Portman on June 23. He said other members with textile constituents in
North and South Carolina as well as Georgia and Virginia were also interested in the issue
and that the administration could likely win a number of votes with a commitment.
But he did not provide an indication of how many votes could be secured by
meeting these demands.
He also said he had met with the ambassadors to the U.S. of Nicaragua
and El Salvador, and that
they had indicated they wanted to work with members of Congress to prevent
their countries from being used as portals for Chinese fabric to enter the U.S.
A House aide said this issue is not one that has been mentioned by
Coble, the chair of the House Textile Caucus, who is set to meet with Portman
today (June 24). Coble remains undecided on DR-CAFTA, the aide said.
Rep. Walter Jones (R-NC) this week said 30 Republicans are solidly
against the DR-CAFTA deal. Among the prominent Republican opponents is Rep. Phil
English (R-PA), who said this week he did not anticipate changing his no vote
against the draft implementing bill in the Ways and Means Committee during the
House floor vote.
English has been demanding that the White House back a bill that would
allow the Commerce Dept. to impose countervailing duties on non-market
economies, but the Bush Administration has argued that this is possible to do
without legislation. English this week also introduced a bill that would lead
to impose surcharges against Chinese imports for its currency manipulation.
In a related development, House
Ways and Means is considering a China bill that
would make it easier to collect assessed antidumping duties from Chinese
importers and to bolster USTRs enforcement budget (see related story).
The administration is lagging on Republican votes, which means it has
stepped up its effort to secure more Democrats, sources said. This involves
efforts to try to shore up the labor rights in Central
America, which largely focus on Sen. Jeff Bingaman (D-NM), sources
said. He has asked the administration for more funding on trade capacity
building, and an independent report by the International Labor Organization on
the status of labor rights in Central America
(see related story).
The administrations talks with Bingaman have attracted the
interest of some House Democrats who may be inclined to vote for the agreement
if they could get some comfort on labor issues, a Senate aide said.