Changes Needed in Administering Relief to Industries Hurt by Overseas Competition

Gao ID: ID-81-42 August 5, 1981

GAO evaluated the implementation of sections of the Trade Act of 1974 to determine whether the legislation was being administered effectively to enable U.S. industry to become more competitive.

GAO found that the program, as administered, does not provide the intended level of import relief. The Government and the petitioners do not agree on specific adjustment commitments to improve competitiveness. These problems can be rectified with better administration. Insufficient use of inhouse expertise and uneven assessments of industry efforts to compete have resulted in the omission or unclear presentation of important material in the final reports to the International Trade Commission (ITC) Commissioners. In some cases, the Commissioners' opinions were so general that their judgments were not clearly explained. The executive branch relief-remedy determination process meets the intended objective of enabling the President to make his decision within the allotted time. The executive branch should continue to assess and rule on the broader implications of providing import relief. There is some duplication in certain report requirements. In monitoring and enforcing the relief program, GAO noted that: (1) some industries are omitted from quarterly and annual surveys, resulting in a lack of information on their economic well-being; (2) petitioners' adjustment strategies supplied to the Government are not specific and there are no binding commitments on the part of petitioners to become competitive if import relief is granted; (3) survey reports are incomplete and imprecise; (4) required reviews of developments with respect to industries granted relief are not met; and (5) there has been a failure to control increasing imports.

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