pean Economic Community, Japan, Spain, Sweden, Switzerland, and the United States (Group of 8). The conference was launched by a ministerial-level meeting in December 1975 to deal with North-South relations. Not part of the U.N. structure, CIEC was an independent conference without formal ties to any international body. For further information concerning the origins and accomplishments of CIEC, see the testimony of Richard N. Cooper, Under Secretary for Economic Affairs, Dept. of State, before the Congressional Joint Economic Committee on June 21, 1977, printed in 77 Dept. of State Bulletin 92–98.

For further information concerning CIEC and portions of Under Secretary Cooper's June 21, 1977, testimony, see post, pp. 736–737 and 744–747.

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International Trade

Import Control

Non-Rubber Footwear

On April 1, 1977, President Carter announced his decision to reject the restrictive tariff rate quota recommended by the United States International Trade Commission for non-rubber footwear but to grant import relief to the U.S. shoe industry through the negotiation by the Office of the Special Representative for Trade Negotiation of orderly marketing agreements with appropriate foreign suppliers of shoes. The President also announced that he would recommend to Congress within 90 days legislation for a program of assistance to help the American shoe industry to meet foreign competition.

While expressing great reluctance "to restrict international trade. in any way," President Carter found the problems of the American shoe industry so extreme that he felt compelled to seek "modest mandatory limits on imports." The key findings of damage to the American shoe industry cited by President Carter follow:

The number of firms in the shoe industry dropped from 600 in 1968 to 380 today-a 40% decline. Employment in that same period fell by 30%, which represents a loss of 70,000 jobs. Imports from our two major overseas suppliers have increased by more than 100% in the last 2 years and seem to be increasing even more rapidly in recent months.

13 Weekly Comp. of Pres. Doc. 478 (Apr. 4, 1977). President Carter's determination concerning the recommendation of the U.S. International Trade Commission was taken pursuant to sec. 202 (b) of the Trade Act of 1974 (P.L. 93-618. 88 Stat. 1978).

On June 22, 1977, President Carter signed Proclamation 4510, which directed that the orderly marketing agreements entered into on June 14, 1977, and June 21, 1977, between the United States and the Republic of China and Korea, respectively, with respect to non-rubber

footwear be implemented according to their terms and his Proclamation.

The orderly marketing agreement with the Republic of China, which was signed by James C. H. Shen, Ambassador of the Republic of China, and Robert S. Strauss, the Special Representative for Trade Negotiations, provides that Taiwan's export of specified types of shoes to the United States in the first year will not exceed 122 million pairs, a decrease of 34 million pairs below its 1976 shipments or of about 21 percent. The agreement with Korea, which was signed by Special Representative Strauss and Ambassador Yong Shik Kim, restricts Korean imports in the first year to 33 million pairs, considerably below the Korean record high of 44 million pairs in 1976.

The agreement with Taipei permits Chinese exports to the United States in three categories of non-rubber footwear-leather, plastic, and "other"—to increase by 3 million pairs in 1978-79, 1979-80, and 1980-81, up to a limit of 131 million pairs in the final year of the agreement. Each of the three footwear categories has a separate sub-limit. The Korean agreement has a similar provision permitting an annual growth in exports to a high of 38 million pairs in 1980-81.

42 Fed. Reg. 32430-32435 (1977). Proclamation 4510 summarized the recommendation of the U.S. International Trade Commission specifying the footwear imports causing injury to U.S. industry as follows:

On February 8, 1977, the United States International Trade Commission (USITC) reported to the President (USITC Publication 799) the results of its investigation under section 201(b) of the Trade Act (19 U.S.C. 2251(b)) (the Trade Act). The USITC determined that footwear provided for in items 700.05 through 700.85, inclusive (except items 700.51, 700.52, 700.53, 700.54, and 700.60, and disposable footwear designed for one-time use provided for in item 700.85) of the Tariff Schedules of the United States (TSUS), are being imported into the United States in such increased quantities as to be a substantial cause of serious injury to the domestic industry producing articles like or directly competitive with the imported articles. The USITC recommended the imposition of certain tariff rate quotas on imports of the above specified articles. Id. 32430.

Sugar

On May 4, 1977, President Carter announced that the Secretary of Agriculture should institute, pending the successful negotiation and implementation of an International Sugar Agreement, an income support program for U.S. sugar producers offering supplemental payments whenever the market price falls beneath 13.5 cents a pound. At the same time, the President determined that the import quotas recommended on March 17, 1977, by the U.S. International Trade Commission would not be in the national economic interest.

The U.S. International Trade Commission, responding to a request of the U.S. Senate Finance Committee, found in its investigation of the American sugar industry that sugar imports were a substantial

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cause of a threat of serious injury to the domestic industry and recommended that a 5-year import quota of 4.275 million short tons, raw value, for sugar imports should be allocated among supplying countries. The American Farm Bureau Federation also submitted a petition to the U.S. Special Representative for Trade Negotiations requesting that sugar be withdrawn from the list of products which are eligible for the generalized system of preferences (GSP) under the Trade Act of 1974. An Interagency Trade Policy Staff Committee reviewed these recommendations on the basis of national economic criteria spelled out in the Trade Act of 1974.

In his decision favoring an income support program and opposing import quotas, the President concurred with the determination of the Interagency Trade Policy Staff Committee that sugar should continue to receive duty-free treatment from designated developing countries under the generalized system of preferences. The Interagency Trade Policy Staff Committee found that imports of sugar under GSP account for only 17 percent of total sugar imports and do not significantly affect the U.S. price level.

President Carter's report to the Congress, which was submitted in identical letters to Thomas P. O'Neill, Jr., Speaker of the House of Representatives, and to Walter F. Mondale, President of the Senate, follows:

IMPORT RELIEF ACTION
SUGAR

In accordance with section 203(b)(2) of the Trade Act of 1974, I am transmitting this report to the Congress setting forth the actions I will take with respect to sugar imports covered by the affirmative finding on March 17, 1977, of the United States International Trade Commission (USITC) under section 202 (d) (1) of the Trade Act of 1974.

I have determined that import relief for the sugar industry is not in the national economic interest. Import relief, achieved either through quotas or tariff increases, would have an inflationary impact on the economy, raising prices to consumers without the promise of offsetting price stabilization benefits. It would be of questionable benefit to the domestic sugar industry, because it would encourage increased market penetration by substitute sweeteners, particularly high-fructose corn syrup, which can be produced at a lower cost than most U.S. sugar.

In addition, the U.S. has entered into negotiations for an International Sugar Agreement (ISA) which, if successful, would provide some long term assurance of greater stability in world prices. Imposition of import relief now would likely jeopardize the success of these negotiations. Finally, imposition of import relief would adversely affect the export earnings of a number of developing countries which depend on sugar exports for their economic growth and prosperity.

However, in recognition of the problems facing much of the U.S. sugar industry due to low sugar prices, I am requesting the Secretary of Agriculture to institute an income support program, for sugar producers, effective with the 1977 crop, offering supplemental payments of up to two cents a pound whenever the market price falls beneath 13.5 cents per pound. Such a program will help cover the costs of production of many U.S. sugar producers, pending the successful negotiation and implementation of an ISA. The United States has made a strong commitment to the negotiation of an ISA which, if successful, will provide some long term assurance of greater stability of world

sugar prices and supplies. The successful implementation of an ISA would also make further consideration of unilateral measures unnecessary.

Finally, I have asked the Special Trade Representative to continue to follow closely the sugar import situation and in consultation with the Secretary of Agriculture, to advise me with respect to any need for consideration of further action.

13 Weekly Comp. of Pres. Doc. 658 (May 9, 1977).

A portion of President Carter's letter to Secretary of Agriculture Bob S. Bergland requesting the institution of an income support program for sugar producers follows:

I have determined today that import relief is not in the national economic interest. However, I believe that a strong and viable domestic sugar industry is vital to the economic well-being of the American people, and that this can best be achieved by the negotiation and implementation of an International Sugar Agreement. As you know, I have instructed our negotiators to enter into negotiations regarding such an agreement and discussions are now underway in Geneva.

In the interim, pending completion of these negotiations, I have decided that the implementation of domestic measures are necessary to help U.S. producers and processors through the present period of low prices. Accordingly, I hereby request that you institute, pursuant to section 301 of the Agricultural Adjustment Act of 1949, a program for sugar producers, effective with the 1977 crop, offering supplemental payments of up to two cents a pound, whenever the market price falls beneath 13.5 cents per pound, for the interim period, until an International Sugar Agreement is successfully negotiated and implemented. Id. 657.

Section 902 of the Food and Agriculture Act of 1977 (Public Law 95-113), approved on September 29, 1977, contains the following provision concerning sugar price supports and the International Sugar Agreement of 1977:

"(f) (1) The price of the 1977 and 1978 crops of sugar beets and sugar cane, respectively, shall be supported through loans or purchases with respect to the processed products thereof at a level not in excess of 65 per centum nor less than 52.5 per centum of the parity price therefor: Provided, That the support level may in no event be less than 13.5 cents per pound raw sugar equivalent. In carrying out the price support program authorized by this subsection, the Secretary [of Agriculture] shall establish minimum wage rates for agricultural employees engaged in the production of sugar.

"(2) Notwithstanding any other provision of law, the Secretary may suspend the operation of the price support program authorized by this subsection whenever the Secretary determines that an international sugar agreement is in effect which assures the maintenance in the United States of a price for sugar not less than 13.5 cents per pound raw sugar equivalent.

"(3) Nothing in this subsection shall affect the authority of the Secretary to establish under any other provision of law a price support program for that portion of the 1977 crop of sugar cane and sugar beets marketed prior to the implementation of the program authorized by this subsection."

91 Stat. 949.

On November 11, 1977, President Carter signed Proclamation 4538. imposing import fees on certain sugars, syrups, and molasses and requesting the U.S. International Trade Commission to make an immediate investigation concerning this matter pursuant to section 22 of the Agricultural Adjustment Act, as amended (7 U.S.C. 624). The import fees for sugar, syrups, and molasses derived from sugar cane or sugar beets, varied according to the value, but were not applicable to articles exported to the United States before the date of the proclamation or imported to fulfill forward contracts entered into before the date of the proclamation provided that the articles were entered or withdrawn from warehouse for consumption on or before January 1, 1978. On November 11, 1977, President Carter also signed Proclamation 4539, increasing tariffs on certain sugars, syrups, and molasses to the maximum level permissible under the Trade Expansion Act of 1962 and our General Agreement on Tariffs and Trade (GATT) obligations.

42 Fed. Reg. 59037-59040 (1977). On Jan. 20, 1978, President Carter signed Proclamation 4547, in which he found that the fees established by Proclamation 4538 were insufficient and established new, fixed fees for raw and refined sugar. 43 Fed. Reg. 3251-3252 (1978).

For further information concerning Proclamation 4463 of Sept. 21, 1976, see the 1976 Digest, Ch. 10, § 2, pp. 464-465.

Television Receivers

On May 19, 1977, President Carter determined in a Memorandum for the U.S. Special Representative for Trade Negotiations the actions he would take pursuant to Section 202 (b) (1) of the Trade Act of 1974 (P.I. 93-618) with respect to the report of the U.S. International Trade Commission (USITC) dated March 22, 1977, concerning television receivers, color and monochrome, assembled or not assembled, finished or not finished, and subassemblies thereof. Three members of the USITC had determined in their report to the President that such color receivers, which are provided for in item 685.20 of the Tariff Schedules of the United States (TSUS), are being imported into the United States in such increased quantities as to be a substantial cause of serious injury to the domestic industry producing articles like or directly competitive with the imported articles.

Portions of President Carter's decision accepting, inter alia, this determination follow:

Pursuant to Section 330 (d) of the Tariff Act of 1930, as amended. the President may accept, in the case of an evenly divided USITC vote on an injury determination, the determination of either set of