And now a word from the MDC...

[Borba100@xxxxxxxxxxx]

This comes from the MDC website. At the end of this thing, the MDC leader
PROMISES  that the MDC will be GOOD BOYS and enforce all provisions of this
US bill...To skip to the MDC comments, just do a "search" for  a string of
asterikes -  - like this **********



-Jared

 The Africa Bill â?? Implications For Zimbabwe And The Region
June 16, 2000

The Africa Bill was signed into United States Law in the middle of May. It
comes into effect from 1st October 2000 and will run through to 30th
September 2008. Second only to NAFTA, the Bill extends the most beneficial
U.S. trade and investment program available to any region worldwide. There
are tremendous opportunities available to all the countries eligible to take
advantage of the benefits offered.

The Africa Bill demands all recipient countries meet or are in the process of
making progress towards meeting the laid down criteria, before the US
Government will approve each nationâ??s eligibility.

Conditions of Eligibility  TOP

A market-based economy that protects private property rights.
The rule of law, political pluralism and the right of due process
The elimination of barriers to U.S. trade and investment including providing
"national treatment" to foreign investment, protecting intellectual property
Economic policies to reduce poverty [JARED SAYS: BALONEY]
A system to combat corruption, and [JARED SAYS: tyhis translates: laws that
allow misbehaved leaders to be sent to jail]
Protection for internationally recognized worker rights, including
eliminating abusive forms of child labour. [Jared says: Spare me this baloney]
Furthermore, to ensure that transshipment abuse does not occur, eligible
countries will need to put in place:

A visa system approved by the U.S. Customs Department [Jared says: Do I hear
COLONY!?!]
Measures to enact and enforce the prevention of transshipment (WTO ACT
Article 5)
Full cooperation with U.S. Customs including allowing on-site inspections
[JARED SAYS YES I DO HEAR COLONY!]
Effective local customs who will be responsible for issuing of a certificate
of origin amongst other things
Records proving compliance to the rules of origin of the Bill will have to be
kept for 2 years, at company level, including a full paper trail showing
origin of all components used in the make up of the exported garment.

NOTE: U.S. Department of Commerce can re-impose duties on a particular
product if imports of that product from a single country cause "serious
damage or threat thereof" to U.S. domestic industry. This safeguard will only
apply to apparel made from either third-country fabric or those made from
African fabric. [Jared's NOTE: that the US gets to protect US industry but
the Zimbabweans don't get to protect NOTHING!]

Effectively the GSP has now been extended for a further eight years for
Africa only and offers extended coverage to;

Footwear
Luggage
Handbags
Leather work gloves
Leather apparel
Watches

Should these industries want to take advantage of the duty free situation
offered they would have to apply to the U.S. Government for approval on a
non-sensitive basis.

Outline of the Bill  TOP

The African Economic Forum will be held annually and gives a permanent venue
for new policy initiatives

The possibility for future Free Trade Agreements with the U.S. is ensured

The U.S. Presidentâ??s Partnership Initiative confirms expanded OPIC and Ex-Im
Bank programs for African trade and investment

Quota free access is given to products that do not qualify for the duty free
treatment
Countries have been categorized into Least Developed Countries (LDCâ??s) and
Non-LDCâ??s. The non-LDCâ??s include Botswana, Gabon, Mauritius, Namibia,
Seychelles and South Africa

Clothing from LDCâ??s only, made from third-country fabric will be eligible for
duty free access, for the first four years only. A quota cap of 1,5% in year
one growing to 3,5% in year three of total U.S. apparel imports will apply.
Clothing from all sub-Sahara African countries, made from cloth made in
Africa, from either U.S. or African yarn will be eligible for duty free
access for the full term of the offer, but will be subject to a cap starting
at 1,5% and increasing to 3,5% of total U.S. apparel imports.
NB:
All caps are based on volume not value - square meter equivalent (SME),
All caps are issued on first come first served basis and controlled from the
U.S.

For cloth to qualify as "African" it must be made of yarn spun in Africa. The
fibre used to spin the yarn, may be imported from any third party country

Clothing made from cut U.S. cloth will be duty free and quota free
Clothing made from uncut U.S. cloth but sewn with U.S. thread will be duty
free and quota free
Knit-to-shape cashmere sweaters, regardless of the origin of the yarn source
will be duty free and quota free
Sweaters made from fine merino wool, regardless of the origin of the yarn
will be duty free and quota free
Clothing made from yarn or cloth "unavailable" in the U.S. will be duty free
and quota free and include;
Fine count knitted cotton fabric
Linen
Silk
Cotton velveteen
Fine suale corduroy
Harris Tweed
Lightweight high thread count poly-cotton woven fabric
Light weight high thread count broadwoven cloth for shirting

Petitions may be filed to request certification of additional yarns/cloths

Certified handloomed, handmade and folklore clothing will be duty free and
quota free
The "wholly assembled" rule of origin will apply.
Cumulation between eligible countries is allowed.
The Opportunities offered and the risk of not being eligible TOP

So what does this all mean in real terms to the clothing industry and in fact
the full supply pipeline associated to this industry:

Depending on growth rates on clothing imports into the U.S. apparel market,
the 3,5% quota cap on duty free goods available, if fully utilised, relate to
exports of up to US$5 Billion per annum by year 8. This does not include the
significant volume of garments that qualify outside the quota caps.
Furthermore, this figure is only for clothing and does not include the raw
material requirement, which must be manufactured within sub-Saharan Africa to
achieve the maximum apparel exports.
It must also not be forgotten that quotas worldwide will be lifted in 2005
allowing for unlimited volumes to flood the U.S. market. In effect, the
opening of quotas will substantially increase sub-Saharan Africaâ??s potential
export volumes in a duty free environment.

African production of high quality yarn must increase six-fold in the next
eight years to take full advantage of duty free access under the Bill.
Obviously the weaving, knitting, dying, printing and finishing capacity of
the textile industry has to increase at the same dynamic rate. Trim,
accessory and packaging suppliers will also be affected accordingly.
There are various estimates of the potential employment opportunities based
on the above analysis. 3 million people directly employed in the potential
clothing manufacturing pipeline seems highly feasible. If you then add the 6
dependents of these workers, 18 million people can be directly effected.
The macro-economic benefits related to the trade and investment opportunities
have the potential to completely change the lives of the 700 million people
living in sub-Saharan Africa.
Sub-Saharan African clothing companies currently competing successfully on
the U.S. market will become the most competitive in the world, particularly
those in the LDCâ??s for the first 4 years.
The natural development of the clothing and textile pipeline that the Bill
will promote, will further strengthen African exports competitive edge under
the Lome Agreement into Euroland, thus giving eligible countries highly
preferential access to 50% of the global apparel market.
In the final analysis, the Bill has been constructed to encourage the maximum
value added benefit to sub-Saharan Africa exporting countries. Any country
that is not approved loses overwhelming benefits and faces certain
disinvestment in its current clothing and textile pipeline. It will not take
long for non-eligible countries manufacturers to become uncompetitive
compared to their counterparts in surrounding eligible countries.

It is expected that foreign investment into the industry will flood in after
it is known which countries will be approved before 1st October 2000. As this
industry traditionally develops in clusters, initial investment will attract
future investment

Where does Zimbabwe stand?  TOP

Zimbabwe has been categorised as a LDC, which give it further advantages over
non-LDCâ??s, in the first four years.

Last year the USTR conducted a study of the countries in sub-Saharan Africa
to see which would be approved in the start up stage of the program. At that
time the USTR found it would probably approve 17 countries including
Zimbabwe. Regrettably, this seems to no longer be the case and Zimbabwe may
end up as a spectator to the trade and development that will definitely start
happening once it is known exactly which countries are being approved. Any
country not approved at this stage will have to miss out on the benefits
available and apply at a later date once it believes it has met the criteria
of the Bill.

As the Bill has only been approved in the last few weeks it is necessary to
wait and see how the administration will interpret some of the legislation
and reassess countries for eligibility by 1st October 2000. However it is
believed that due to the task of getting countries approved, the
administration and U.S. Customs will focus on approving the most conforming
and easiest countries first.

[HERE'S THEIR POSITION**************************]

The Position of the Movement for Democratic Change.  TOP

The Africa Bill is an example of the kind of trade and other development
opportunities that are available to Zimbabwe once its economic and political
position has been corrected. The poor record of the Zanu PF government has
meant that Zimbabwe has become ineligible for these new opportunities. An MDC
government will move quickly to comply with the requirements of the Africa
Bill and will then help industry rebuild its capacity so that it can take
full advantage of the opportunities offered.

If we are able to fully exploit these new opportunities we will be able to
create thousands of new jobs, generate exports to help meet Zimbabweâ??s import
requirements. Zimbabwe has all the ingredients â?? except for a government,
which will create an enabling environment and foster conditions of
governance, which comply with international norms.

Eddie Cross
Secretary, Economic Affairs
MDC
Harare
June 16, 2000  TOP