CARIBBEAN FEARS TRADE BILL PROPOSAL

CARIBBEAN FEARS TRADE BILL PROPOSAL

Caribbean Basin nations and some U.S. firms are upset over an emerging trade bill provision that, they say, would deter U.S. investment in the Caribbean.

The proposal, adopted last week by House-Senate conferees as part of the omnibus trade bill, gives the president much greater flexibility in withdrawing duty-free treatment on products from Caribbean countries.Since 1984, the United States, under the Caribbean Basin Economic Recovery Act, has afforded duty-free treatment to most products from Caribbean nations. At present, 22 countries obtain this duty-free access.

If a Caribbean country is found violating the act's guidelines, the president may withdraw or suspend the duty-free treatment, in totality.

But under the pending trade bill, he also could withdraw or suspend duty- free access more selectively, on a product-by-product basis - a threat, Caribbean Basin experts say, that would discourage U.S. firms from investing in the Caribbean Basin.

A basic thrust of the Caribbean Basin act is to help develop the Caribbean Basin through increased U.S. investment.

The Caribbean Basin countries' lobbying group here says it is dismayed at the trade bill provision.

They say that by making each duty-free item possibly subject to withdrawal, the proposal would deprive U.S. investors in the Caribbean of long-term duty-free assurances.

Under the present law, they argue, a Caribbean country would be penalized only if it committed a serious breach of the Caribbean Basin trade law.

The pending proposal, they say, would expose the Caribbean countries to an array of selective penalties for less than overriding breaches of the law.

The proposal to alter the Caribbean Basin law largely reflects an effort by some U.S. companies to get more leverage in their drive to improve patent and copyright protection in the Caribbean.