NATIONAL ASSOCIATION OF EXPORT MANAGEMENT COMPANIES, INC.,

Hon. WILBUR D. MILLS,

Chairman, Committee on Ways and Means,

Washington, D.C.

New York, N.Y.

DEAR SIR: On June 16, I wrote to you as president of the National Association of Export Management Companies, Inc., to support proposals for the creation of Domestic International Sales Corporations and for more competitive financing of United States exports.

I would now like to express the serious apprehension of our Export Management Companies about the threat to American exports posed by new American restrictions on imports, particularly the exports produced by small U.S.A. manufacturers, arising from actions other countries may take in retaliation against new American restrictions on trade.

Our Association was formed in response to the government's drive to increase American exports. We have 60 member companies who are solely concerned with exporting the products of approximately 800 American manufacturers located in 44 states. Our members export manufactured goods valued at more than $400 million annually to all parts of the world. The largest portion of these exports are from small companies who lack the marketing facilities of big multinational companies. Consequently, the exports we are responsible for are quite vulnerable to hostile action by other countries. Higher tariffs can easily price us out of foreign markets and in the case of foreign quotas, our products would be the first to suffer and would suffer the most.

Our own export management companies are also relatively small firms ranging from three to 150 employees and many could not survive in a climate of trade restrictions.

We therefore wish to register our support of the Administration's Trade Act of 1969 and our opposition to amendments or substitutions that would give other countries cause to penalize American exports.

Import quotas are one of the non-tariff trade barriers which this country has been opposed to for many years. If we must have import quotas for imperative reasons, such quotas should be limited only to those countries which discriminate unreasonably against the importation of American products into their countries. Import quotas against the products of friendly countries which grant fair and open treatment to American products should, in our opinion, be avoided.

It is our view that the provisions in the President's Bill will make it substantially easier for American companies damaged by imports to obtain relief in the form of adjustment assistance and other means as provided in the Bill, and will do so in a manner that would not give other countries reason to retaliate against American exports. We firmly believe that when a "Due Process" route is available to domestic industries, they should use it and should exhaust all remedies provided by law, and should endeavor to avoid taking steps that can make the American export industry pay through lost export business for whatever benefits the protected domestic industries might receive.

The other provisions in the Administration's Bill strike us as useful improvements to existing legislation and, in the case of the request for modest negotiating authority, insurance against undesirable retaliations. We also believe that the repeal of the American Selling Price System of customs valuation, on balance, will benefit American exports which we understand to be the government's policy and the reason why the government encouraged the formation of our Association. The retention of the American Selling Price System will be inconsistent with our country's efforts to eliminate other non-tariff restrictions on imports into foreign countries.

If it is possible for this communication to be included in the record of your hearings, the members of this Association will be grateful. But, in any case, we ask you and the members of your committee to bear in mind our situation and the situation of the many companies throughout this country whose products we are trying so hard to export.

Respectfully yours,

ARTHUR A. SINGER, President.

The CHAIRMAN. The Chair desires to make a statement.

All those who have been requested to, or planned to submit written statements should do so as quickly as they can because the record, itself, the hearing record, will remain open only through Friday, June 26, in order that we can have it printed in time for it to be available to the membership of the House when the legislation is before the House.

Without objection, the committee will adjourn, subject to the call of the Chair, because I am not certain yet just what day next week Secretary Stans will appear. It now looks as though it may be on Wednesday but the Chair will give the membership of the committee at least 24 hours' notices of the next meeting.

Without objection, then, the committee adjourns, subject to the call of the Chair.

(Whereupon, at 12:10 p.m., the committee adjourned, to reconvene at the call of the Chair.)