37 



ing about, will address that issue in an effective manner. That's in 

 the NAFTA itself right now. 



Two, in terms of addressing the problem of surges which we're 

 not aware of — I think you feel they could sneak up on us — part of 

 the safeguard against surges is that in the supplemental agree- 

 ment negotiations we will discuss an early warning system that we 

 could implement which I think would be extremely helpful. 



Three, on sugar itself, as you know, the substitution problem is 

 left unaddressed in chapter 7 of the NAFTA itself. We believe that 

 we can look at that in a hopefully effective manner, and some other 

 areas as well, without getting into a negotiating strategy in public. 

 It is certainly on the front burner as far as we are concerned, but 

 I would be quick to add, as you know better than I, that in fact 

 Mexican sugar production has gone down. Its population has 

 grown. We have more and more imports into Mexico rather than 

 the opposite. In terms of substitution, it doesn't appear at this 

 point that they have the ability to do that. That doesn't mean that 

 7 or 8 years from now — as you know, for 6 years, we have a quota 

 of 7,258 metric tons on sugar, and then of course it goes up after 

 that, assuming that they have a net production increase. 



In all of those ways, because of the current situation and because 

 of protections and because of what I think we can do with these 

 supplemental agreements, I believe we can address your issues ef- 

 fectively. We certainly mean to do so. 



Mr. Lewis. Thank you, Mr. Ambassador. 



I'd like to correct one thing. I said Florida Wildlife Federation, 

 but I meant that the National Wildlife Federation signed off on 

 NAFTA. 



I think we have to point out very strongly, Mr. Ambassador, that 

 we are very much concerned in Florida about the short-term dif- 

 ferences for the long-term gains. We don't feel that we can afford 

 those short-term losses in a $6.5 billion agricultural industry in 

 Florida. 



Ambassador Kantor. As one who is still a member of the Florida 

 bar and used to practice in Immokalee, Florida, Mr. Lewis, I under- 

 stand some of that. 



Mr. Lewis. Thank you, Mr. Ambassador. 



The Chairman. I thank the gentleman. 



Mr. Rose. 



Mr. Rose. Thank you, Mr. Chairman. 



Mr. Ambassador, in consideration of the Canadian Free-Trade 

 Agreement, we were repeatedly told that Canada did not produce 

 peanuts and should not be a concern to supporters of the peanut 

 program. But from the period 1988 to 1989 imports of peanut paste 

 from Canada were 1.404 million pounds, and in 1991 to 1992 

 11.396 million pounds. 



Mr. Ambassador, that is a heck of a lot of peanuts from a country 

 that doesn't grow many peanuts. We wish you would take a look 

 at that. We think a reasonable interpretation of section 22 pro- 

 hibits the importation only of peanut butter and we can't under- 

 stand why peanut paste is coming into this country in violation of 

 section 22. Most of these peanuts are coming from China and Ar- 

 gentina. 



