Letter to the Speaker of the House and the President of the Senate on the Designation of Certain Countries as Caribbean Basin Economic Recovery Act Beneficiaries

Dear Mr. Speaker: (Dear Mr. President:)

Pursuant to Section 212 of the Caribbean Basin Economic Recovery Act (CBERA), I wish to inform you of my intent to designate the following nine Caribbean Basin countries and entities as beneficiaries of the trade-liberalizing measures provided for in this Act: Antigua and Barbuda, Belize, the British Virgin Islands, El Salvador, Grenada, Guatemala, Haiti, Honduras, and Montserrat. Designation will entitle the products of said countries, except for products excluded statutorily, to duty-free treatment for a period beginning on January 1, 1984 and ending on September 30, 1995. As beneficiaries, these nine also have the opportunity to become eligible for the convention expense tax deduction under Section 274(h) of the Internal Revenue Code of 1954, by entering into an exchange of information agreement with the United States on tax matters.

Designation is an important step for these countries in their battle to revitalize and rebuild their weakened economies. Designation is also significant because it is further tangible evidence of the constructive cooperation between the United States and the peoples and governments of the Caribbean Basin.

My decision to designate the group of nine flows out of discussions held between this Administration and potential beneficiary countries and entities regarding the designation criteria set forth in Section 212 of the CBERA. Our discussions with the nine were concluded this month subsequent to the designation of eleven countries and entities on November 30. Discussions are still underway with other potential beneficiaries, and I will designate additional countries as this becomes appropriate.

The nine countries have demonstrated to my satisfaction that their laws, practices and policies are in conformity with the designation criteria of the CBERA. The governments of these countries and entities have communicated on these matters by letter with Secretary of State Shultz and Ambassador Brock and in so doing have indicated their desire to be designated as beneficiaries (copies of the letters are attached). On the basis of the statements and assurances in these letters, and taking into account information developed by United States Embassies and through other sources, I have concluded that the objectives of the Administration and the Congress with respect to the statutory designation criteria of the CBERA have been met.

I am mindful that under Section 213(B)(2) of the CBERA, I retain the authority to suspend or withdraw CBERA benefits from any designated beneficiary country if a beneficiary's laws, policies or practices are no longer in conformity with the designation criteria. The United States will keep abreast of developments in the beneficiary countries and entities which are pertinent to the designation criteria.

This Administration looks forward to working closely with its fellow governments in the Caribbean Basin and with the private sectors of the United States and the Basin countries to ensure that the wide-ranging opportunities opened by the CBERA are fully utilized.

Sincerely,

RONALD REAGAN