168 



phytosanitary standards will eventually rise to the U.S. level as Mexico is increas- 

 ingly required to meet U.S. standards for quality. 



Washington Apple Commission 



Fully supports the agreement. Mexico is already its largest export market, and 

 the agreement will further open its market. 

 Western Dairy Co-op, Inc. 



Supports the agreement for the dairy industry. The rules of origin, health, pes- 

 ticide and environmental standards are all acceptable. The Co-op is concerned about 

 the future impact on U.S. agriculture. If Mexico allows foreign investors to own 

 farmland, large-scale dairies could be established and, with low wage scale, make 

 it difficult for American farmers to compete. 



Western Growers Association 



NAFTA falls far short of its expectations, and concerns must be addressed if fruit, 

 vegetable and nut growers are to benefit. The areas that need to be looked at fur- 

 ther are: Environmental, labor and pesticide regulations; longer phaseout for sen- 

 sitive crops (20 years); price-based safeguard rather than a volume-based snapback; 

 action to retaliate if Mexico uses phytosanitary measures as a means to limit U.S. 

 product; immediate elimination of Mexican import licenses on table grapes and pota- 

 toes; establish a Mexican PACA; commercial dispute settlement; protection of intel- 

 lectual property; and Mexican funding in U.S. promotion programs of mutual bene- 

 fit. 



Wine Institute 



The NAFTA is inadequate because Mexico does not provide the same access for 

 U.S. table wines that Mexican wines entering the United States enjoy. Chile re- 

 ceives better market access to Mexico than the United States. The U.S. industry 

 only has about 10 percent of this market, and this is not expected to increase after 

 the NAFTA is implemented because the market access provisions place the United 

 States at a competitive disadvantage. 



Women Involved in Farm Economics 



WIFE has several concerns with the agreement. Rules of origin have to be 

 strengthened and enforced, and end-use certificates should be required; U.S. compa- 

 nies operating in Mexico should be required to adhere to U.S. environmental laws; 

 challenges to U.S. pesticide laws is allowed under the agreement; and Mexican agri- 

 culture products containing banned pesticides could reach the U.S. market. WIFE 

 is especially concerned about the impact the agreement will have on U.S. jobs and 

 how this will lower the living standard in the United States. 



QUESTIONS SUBMITTED FOR THE RECORD BY SENATOR BAUCUS AND 



RESPONSES THERETO 



Secretary Espy 



Question 1. I am supportive of efforts to use Section 22 with regard to Canadian 

 wheat. Does the administration intend to pursue section 22 action and to require 

 end-use certificates on imported grain? 



Answer. As you are aware, President Clinton requested the International Trade 

 Commission to undertake a Section 22 investigation on wheat, to commence on Jan- 

 uary 15, unless the administration had successfully resolved the issues connected 

 with Canadian wheat imports. To date, despite negotiations both in Geneva and 

 Canada, we have not yet reached an agreement with the Canadian Government on 

 the various wheat issues. We continue to pursue a solution to this and other issues 

 with the Canadian Government, but the Section 22 investigation will go forward. 



In addition, the NAFTA implementing legislation contains a provision requiring 

 the USDA to impose end-use certificates on wheat and barley imports from any 

 country that also requires end-use certificates on U.S. grain imports. This require- 

 ment will go into effect 120 days after the implementing legislation is enacted, un- 

 less Canada agrees to remove its requirement. 



Question 2. Is the administration prepared to exchange letters with the Mexican 

 Government, committing to work towards the elimination of export subsidies on 

 sales of grain to Mexico? 



Answer. The NAFTA text calls for the three parties to work toward eliminating 

 all export subsidies on agricultural trade in North America. We are prepared to 

 work toward that goal, but could not agree to eliminate all export subsidies in the 

 NAFTA because Mexico continues to import subsidized agricultural goods from non- 

 NAFTA countries. Additionally, export subsidies were not defined in the NAFTA, 



