thorized major cuts of up to 50 percent. In many cases such cuts equal or exceed a reduction to zero from present rates. One point that I think is worth noting-when we talk of reducing tariffs to zero, in many cases this means a reduction of not many percentage points; contrary to normal belief the average U.S. tariff on industrial goods is 11 percent, and many are well below this level. The step from a tariff of about 11 percent to zero is not as great as many tariff cuts that have been made under past reciprocal trade legislation. Mr. Chairman, we will have a sheet available for any of you if you want to show the history from 1934 to present to show what has happened. It is of course important that the system of classification of products by category be drawn up and made public as soon as possible, and the bill provides that this will be done. It is anticipated that the system which will be chosen is the one shown in annex B, which, Mr. Chairman, I will submit for the record showing the classification. The CHAIRMAN. Without objection. (Annex B referred to follows:) ANNEX B STANDARD INTERNATIONAL TRADE CLASSIFICATION The Standard International Trade Classification (SITC), is a systematic arrangement of all commodities of international trade which is designed to facilitate the reporting of international trade statistics on a uniform basis and has found wide use for this purpose. It has found broad acceptance as a basis for tariff schedules by numerous countries, including the European Economic Community. It is also used by the United Nations in trade compilations in Yearbook of International Trade Statistics, Commodity Trade Statistics, Current Economic Indicators, and Monthly Bulletin of Statistics. In reporting trade statistics to the United Nations, the U.S. Bureau of the Census converts into SITC categories the basic data collected in terms of schedule A numbers for imports and schedule B numbers for exports. The SITC, revised, consists of 10 sections of one-digit classifications. These are further broken down into 56 divisions (two digits), 177 groups (three digits) and 625 subgroups (four digits). Of these subgroups, 275 are further divided (into 944 subsidiary headings) either to provide additional detail of economic interest or to permit exact correspondence with the Brussels Tariff Nomenclature. A list of all three-digit groups in the SITC, revised, is attached. It is expected that this classification system will be that chosen under section 211(b) (1) (A) of H.R. 11970. THREE DIGIT GROUPS 001 Live animals. 011 Meat, fresh, chilled, or frozen. 012 Meat, dried, salted or smoked, whether or not in airtight containers. 013 Meat in airtight containers, not elsewhere specified, and meat preparations, whether or not in airtight containers. 022 Milk and cream. 032 Fish, in airtight containers, not elsewhere specified, and fish preparations, 041 042 whether or not in airtight containers (including crustacea and mollusks). Wheat (including spelt) and meslin, unmilled. Rice. 043 Barley, unmilled. 044 Maize (corn), unmilled. 045 Cereals, unmilled, other than wheat, rice, barley, and maize. 047 048 Meal and flour of cereals, except meal and flour of wheat or of meslin. Cereal preparations and preparations of flour and starch of fruits and vegetables. 051 Fruit, fresh, and nuts (not including oil nuts), fresh or dried. 052 Dried fruit (including artificially dehydrated). 053 Fruit, preserved and fruit preparations. 054 Vegetables, fresh, frozen or simply preserved (including dried leguminous vegetables); roots, tubers and other edible vegtable products, not elsewhere specified, fresh or dried. 055 Vegetables, roots and tubers, preservd or prepared, not elsewher specified, whether or not in airtight containers. 061 Sugar and honey. 062 Sugar confectionery and other sugar preparations (except chocolate confectionery). 071 Coffee. 072 073 074 075 081 091 099 111 Cocoa. Chocolate and other food preparations containing cocoa or chocolate, not elsewhere specified. Tea and mate. Spices. Feeding-stuff for animals (not including unmilled cereals). Margarine and shortening. Food preparations, not elsewhere specified. Nonalcoholic beverages, not elsewhere specified. 112 Alcoholic beverages. 121 Tobacco, unmanufactured. Oil seeds, oil nuts, and oil kernels. Crude rubber (including synthetic and reclaimed). Wood in the rough or roughly squared. 243 Wood, shaped or simply worked. 244 Cork, raw and waste. 251 Pulp and waste paper. 265 Vegetable fibers, except cotton and jute. 266 Synthetic and regenerated (artificial) fibers. 267 Waste materials from textile fabrics (including rags). 271 Fertilizers, crude. 273 Stone, sand and gravel. 274 275 Sulfur and unroasted iron pyrites. Natural abrasives (including industrial diamonds). 276 Other crude minerals. 281 Iron ore and concentrates. 282 Iron and steel scrap. 283 Ores and concentrates of nonferrous base metals. Nonferrous metal scrap. 286 Ores and concentrates of uranium and thorium. Crude animal materials, not elsewhere specified. 291 292 Crude vegetable materials, not elsewhere specified. 321 Coal, coke, and briquettes. 331 Petroleum, crude and partly refined for further refining (excluding natural gasoline). 431 Animal and vegetable oils and fats, processed, and waxes of animal or 512 Organic chemicals. 513 Inorganic chemicals: Elements, oxides and halogen salts. 514 Other inorganic chemicals. 515 521 531 Radioactive and associated materials. Mineral tar and crude chemicals from coal, petroleum and natural gas. 532 Dyeing and tanning extracts, and synthetic tanning materials. 533 Pigments, paints, varnishes, and related materials. 541 Medicinal and pharmaceutical products. 551 Essential oils, perfume, and flavor materials. 553 Perfumery and cosmetics, dentifrices, and other toilet preparations (except 554 Soaps, cleansing and polishing preparations. 561 Fertilizers, manufactured. 571 Explosives and pyrotechnic products. 581 Plastic materials, regenerated cellulose and artificial resins. 599 Chemical materials and products, not elsewhere specified. 611 612 613 621 629 Leather. Manufactures of leather or of artificial or reconstituted leather, not else- Fur skins, tanned or dressed (including dyes). Materials of rubber. Articles of rubber, not elsewhere specified. 631 Veneers, plywood boards, "improved" or reconstituted wood and other 642 Articles made of paper pulp, of paper, or of paperboard. 651 Textile yarn and thread. 652 Cotton fabrics, woven (not including narrow or special fabrics). 653 Textile fabrics, woven (not including narrow or special fabrics), other than 654 Tulle, lace, embroidery, ribbons, trimmings, and other small wares. Special textile fabrics, and related products. 656 Made-up articles, wholly or chiefly of textile materials, not elsewhere 661 Lime, cement, and fabricated building materials, except glass and clay 662 Clay construction materials and refractory construction materials. 667 Pearls and precious and semiprecious stones, unworked or worked. 671 Pig iron, spiegeleisen, sponge iron, iron and steel powders and shot and 672 Ingots and other primary forms (including blanks for tubes and pipes) of 673 Iron and steel bars, rods, angles, shapes and sections (including sheet 674 Universals, plates, and sheets of iron or steel. 675 Hoop and strip of iron or steel. 676 Rails and railway truck construction material of iron or steel. 677 Iron and steel wire (excluding wire rod). 678 Tubes, pipes, and fittings of iron or steel. 679 Iron and steel castings and forgings, unworked, not elsewhere specified. 682 Copper. 683 Nickel. 688 Uranium and thorium and their alloys. 689 Miscellaneous nonferrous base metals employed in metallurgy. Finished structural parts and structures, not elsewhere specified. 692 Metal containers for storage and transport. 693 Wire products (excluding electric) and fencing grills. 694 Nails, screws, nuts, bolts, rivets, and similar articles, of iron, steel or of 695 Tools for use in the hand or in machines. 697 Household equipment of base metals. 698 Manufactures of metal, not elsewhere specified. 711 Power-generating machinery, other than electric. 712 Agricultural machinery and implements. 714 Office machines. 715 Metalworking machinery. 717 Textile and leather machinery. 718 Machines for special industries. 719 Machinery and appliances (other than electrical) and machine parts, 722 Electric power machinery and switchgear. 723 Equipment for distributing electricity. 724 Telecommunications apparatus. 725 Domestic electrical equipment. 726 Electric apparatus for medical purposes and radiological apparatus. 812 821 831 Sanitary, plumbing, heating and lighting fixtures and fittings. Furniture. Travel goods, handbags, and similar articles. $41 Clothing (except fur clothing). 842 Fur clothing (not including headgear) and other articles made of fur skins; 861 Scientific, medical, optical, measuring, and controlling instruments and 862 Photographic and cinematographic supplies. 863 Developed cinematographic film. 864 Watches and clocks. 891 Musical instruments, sound recorders, and reproducers and parts and 892 Printed matter. 893 Articles of artificial plastic materials, not elsewhere specified. 894 Perambulators, toys, games, and sporting goods. $95 Office and stationery supplies, not elsewhere specified. 896 Works of art, collectors' pieces, and antiques. 897 Jewelry and goldsmiths' and silversmiths' wares. 899 Secretary HODGES. The 80-percent formula list will be calculated Attached as annex C for illustrative purposes only, is a tabulation Mr. Chairman, I would submit that for the record. (Annex C referred to follows:) ANNEX C TRADE EXPANSION ACT OF 1962 CATEGORIES IN WHICH THE UNITED STATES AND THE EUROPEAN ECONOMIC COMMUNITY PLUS FIVE POSSIBLE ADDITIONAL MEMBERS SUPPLIED 80 PERCENT OR MORE OF FREE-WORLD EXPORTS IN 1960 The attached is a tabulation of those commodities groups based on the Standard International Trade Classification, Revised (SITC), of which the value of exports from the United States and six present and five other possible members of the European Economic Community together accounted for 80 percent or more of free-world exports in 1960. Such a commodity list can only be illustrative at the present time of the kinds of commodity groups which may be included in a finally selected list under the "80 percent dominant supplier formula" in the special European Common Market authority in the Trade Expansion Act of 1962. Under the provisions of the new trade legislation a definitive list of the commodity groups which would be included under the special EEC authority can only be compiled (1) at a future date which approaches the commencement of negotiations, and (2) after data have been assembled for world trade in a representative period, selected from the 5 years previous to the time the list is drawn up, as determined by the President. Such period may include future years for which trade statistics are not yet available. In accordance with the bill's requirements, some commodity groups included in the attached illustrative list for 1960 may not be included in the final list and others may be added, depending upon what the trade figures show for the actual representative period selected. The list of commodities to be actually offered in negotiation under the special EEC authority, as distinguished from the maximum list of commodities which could be included as described in the preceding paragraphs, would only be put together after public hearings have been held by the President and by the Tariff Commission, and the Tariff Commission has reported to the President its views concerning the impact on American employment, productive facilities, and profits from anticipated reductions in duties on such commodities. Under the proposed law, items on which escape clause or national security action is in effect must be withheld from negotiation, as must certain other items previously covered by escape clause investigations, as described in the bill. In addition, the President may withhold such other items, where he deems such action to be in the best interests of the Nation and the economy. |