The issue of immediate concern is that, regardless of whether the completed free trade agreements with Peru and Colombia are approved by Congress in the “lame duck” session expected to begin next week, duty-free preferences for imports from those countries will disappear as of January 1, 2007, unless some action is taken to extend the ATPA. (Even if the free trade agreements are approved by Congress in the next few weeks, they will certainly not be implemented for several months down the line). Therefore, AFI took the lead some months ago to form a coalition of companies and associations that are pushing for an ATPA “bridge” that could fill the gap between expiration of the ATPA (if the program itself is not extended) and the implementation of the free trade agreements. While there are no guarantees that such “bridge” legislation will be approved during the lame-duck session, we are cautiously optimistic that some action will occur. The other two ATPA beneficiaries, Ecuador and Bolivia, are in a more “hazardous” position since they are not currently negotiating free trade agreements with the United States (indeed, one official with whom we met flat out stated that these countries are “out of luck.”).

At this time, the “lame-duck” session is scheduled to begin on November 13. However, the outcome of today’s elections will likely determine how long a “lame-duck” session will continue and how much work will actually get done during that period. The general feeling is that the session will go on longer, and cover more ground, if the Republicans keep control of both the House and Senate. In any case, there is a long list of matters vying for attention during this critical period, both on the trade front and otherwise. On trade matters alone, aside from the ATPA issue, Congress may consider permanent “normal trade relations” with Vietnam, an extension of the Generalized System of Preferences (which is also scheduled to expire as of January 1), the free trade agreement with Peru, the agreement with Colombia, a miscellaneous tariff bill, and an extension of the African Growth and Opportunity Act.

In the next few days, we will be laying the groundwork for the work we need to do during the “lame duck” session in order to protect the interest of the Association and its Members to the greatest extent possible. This will include targeted political action letters, especially with regard to the extension of ATPA treatment. In any case, as we noted previously, Members are advised to act prudently in their commercial dealings with Peru, Colombia, Ecuador and Bolivia, and to maximize their entries from these countries prior to December 31 with the understanding that as of today, there is certainly no guarantee that imports from these countries will remain duty-free after midnight of December 31.

We will, of course, keep Members closely advised. In the interim, do not hesitate to contact Jeff Levin or Bob Bauer if you have any questions on any of these matters.