Tariff privilege needs protection: Legislators

Stunned by yet another attempt to amend the Covenant, legislators yesterday lashed out at a proposed legislation in the US Congress that would remove trade privileges granted the Northern Marianas, saying it will spell economic disaster for the island.

They vowed to oppose the proposal sponsored by Senators Spencer Abraham (R-Michigan) and Ernest Fritz Holling (D-S. Carolina), including lobbying efforts in Washington to protect the interests of the commonwealth government. The measure is expected to be introduced this week.

Likewise, local leaders tied the move to ongoing plan to establish free trade zones in the CNMI, noting that removal of the privileges provided under Headnote 3(a) of the Covenant will discourage potential foreign investors attracted by the quota-free, duty-free provisions.

Rep. Melvin Faisao, chair of the House Federal and Foreign Relations Committee, echoed concerns that the proposal will infringe on the Covenant which has ensured assistance from the federal government in developing the CNMI economy.

“Unless they want to kill us, it is very unfortunate that we are again being threatened by this proposal which could spell an economic disaster for our local people,” he said in a separate interview.

In the absence of a lobbyist to help the CNMI fight off the plan, Faisao suggested the local government should launch a information campaign in the Congress to highlight the “unique situation” of its economy that does not rely on federal dole-outs.

“They have come up with this idea at a time when the CNMI economy is very gloomy and all we need is assistance from the US,” he said.

“I hope they realize where our economy stands now,” stressed Rep. Oscar Babauta, chair of the House Commerce and Tourism Committee. “They should be aware that we are part of the American political family and we should be entitled to what we have negotiated based on the Covenant.”

“We need to protect the Headnote 3 (a) provision, the garment issue should not make the determination that it be removed,” House Speaker Diego T. Benavente said in an interview.

He maintained the island government is still trying to diversify the local economy and an amendment to the trade provisions could prove detrimental to the efforts.

“We look forward to having industries with 100 percent US citizens, why are we removing it all together,” Benavente explained. “This is not right.”

While most members of the Legislature agreed that local leaders must strongly oppose the move, they have yet to map out steps to block the attempts.

The island government has junked hiring a lobbying firm in Washington due to lack of funds, but a nonprofit organization, composed of private sector representatives, have planned to undertake public relations efforts to safeguard CNMI interests.

“We need to protect this because this is something that I feel that we negotiated and that it is not necessary to throw the whole thing out… not necessarily outright repeal of the whole section (of Headnote 3(A),” Benavente said.