>Date: Fri, 24 Jul 1998 13:26:13 -0700

>------------------------------------------------------------

> L A T I N A M E R I C A D A T A B A S E

> NotiSur - Latin American Affairs

>ISSN 1060-4189 Volume 8, Number 26 July 24, 1998

>------------------------------------------------------------

> American Institute, University of New Mexico

> Director: Rebecca Reynolds Bannister

> Editor: Patricia Hynds

> Staff writers:

> Carlos Navarro, Robert Sandels

>LADB ARCHIVES: Back issues are referenced to provide

>historical background relevant to the articles in this

>newsletter. These can be accessed with a subscription to the

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>e-mail info@ladb.unm.edu or call 1-800-472-0888.

>CHILE: U.S. TRADE AGENCY RULES AGAINST SALMON PRODUCERS

> * Maine producers say supervision more important than

>tariffs

> * Chile weighs its options

>*********************

> CHILE

>*********************

>CHILE: U.S. TRADE AGENCY RULES AGAINST SALMON PRODUCERS

> The US International Trade Commission (ITC) ruled July 14

>against Chile in a dispute regarding its salmon exports to the

>US. The ruling said Chilean exports were hurting the US

>salmon industry and found Chilean companies guilty of dumping,

>selling in the US at below-market value.

> Chile is the biggest foreign supplier to US restaurants

>and supermarkets, and salmon imports from Chile were worth

>approximately US$111 million in 1996. Chile insists that it

>can offer cheaper salmon because its industry is more

>efficient.

> The 2-to-1 ruling supports US duties imposed on major

>Chilean companies exporting salmon to the US. It responds to

>a complaint by salmon producers from the US states of Maine

>and Washington (see NotiSur, 11/21/97 and 06/19/98). The ITC

>said the next step is for the DOC to issue an anti-dumping

>order against Chilean salmon and set the tariff to be imposed.

> The ITC board members did not release their opinions, but

>the dissenting member, Carol T. Crawford, said she felt US

>salmon producers had not proved that Chilean salmon imports

>had injured the domestic industry. "Not even close," Crawford

>said. If another ITC member had agreed with Crawford, the

>duty on Chilean salmon would have disappeared just six months

>after the Commerce Department imposed it.

>Maine producers say supervision more important than tariffs

> "We've gotten back to a level playing field," said Joe

>McGonigle, head of the Coalition for Fair Salmon Trade, a

>Maine-based group.

> "It has basically saved this industry," said Michael J.

>Coursey of the Washington law firm of Collier, Shannon, Rill

>& Scott, who represented Maine's salmon producers before the

>ITC. Coursey said for Maine's salmon growers the increased

>supervision Chilean salmon will face from US customs is more

>important than the amount of the duty. "It's like knowing

>your income-tax return will be audited every year."

> "If [Maine's salmon farmers] are suffering any problems,

>it's not because of us," said Richard Johnson of the

>Washington law firm Arnold & Porter, representing Chile's

>interests. Johnson said Maine's US$45 million industry was

>suffering from increased competition from Norway, Canada, and

>Chile, not from dumping.

> The Chileans also received support from US restaurants

>and supermarkets that buy their salmon and do not want to see

>higher tariffs. They say US salmon producers' arguments are

>unsubstantiated.

> Johnson predicted Maine's salmon industry--which employs

>960 workers--would see little benefit from the duties, but

>McGonigle disagreed.

> "This industry has been cut in half in recent years,"

>said McGonigle. "Those [salmon] farms went out of business

>almost exclusively because of Chilean dumping." He added that

>11 of 19 salmon farmers in Maine had closed in three years

>while Chilean imports jumped 75%.

>Chile weighs its options

> In Chile, the industry organization Asociacion de

>Exportadores de Salmon y Trucha (AEST) said the ruling was

>unlikely to alter its exports to the US.

> Francisco Ruiz, AEST president, said the ruling "would

>cause certain marketing difficulties, but Chile will continue

>to be an important player in supplying salmon to the US."

> A much stronger reaction came from Chilean Ambassador to

>the US John Biehl, who said that the DOC had resorted to "sly

>subterfuges and tricks" to demonstrate that dumping had taken

>place. The ambassador berated Maine salmon companies for

>focusing their charges "on a product they do not even offer--

>salmon fillets--because they only sell whole fish."

> Biehl said, against the backdrop of the Asian crisis,

>whose fallout has hit Chile hard, the decision would "transfer

>millions of dollars in resources from a developing country

>that is doing things right and progressing to a developed

>country that happens to be the richest in the world." He said

>the resolution "confirms a unilateral process in which the US

>sets the rules of the game."

> Chilean Foreign Minister Jose Miguel Insulza said the

>ruling "is not damaging economically, but it sets a bad

>precedent."

> Economy Minister Alvaro Garcia agreed that the tariffs

>would not jeopardize the development of the Chilean salmon

>industry, but he said it runs contrary to US President Bill

>Clinton's commitment to free trade.

> Insulza, Biehl, and Garcia agree that the decision is a

>setback for free trade between Latin America and the US. The

>ruling came only three months after the formal initiation of

>negotiations for a Free Trade Area of the Americas (FTAA) at

>the second Summit of the Americas in Santiago.

> The Chilean government and the AEST will decide soon

>whether to take the case to the World Trade Organization (WTO)

>or to appeal the decision in US courts. (Sources: CNN,

>Reuters, 07/14/98; Inter Press Service, 07/16/98; Notimex,

>07/14/97, 07/15/97, 07/19/98)