Panel Votes for Reprisals in Telecommunication Trade

The Senate Finance Committee unanimously approved a bill today requiring retaliation against countries that fail to open their markets to U.S.-manufactured telecommunications equipment.

The legislation, sponsored by Sen. John C. Danforth (R-Mo.), grows out of the court-ordered breakup of American Telephone & Telegraph Co.

The committee views that breakup as removing a major barrier against imports of telephones and switching equipment. In turn, the panel says, other nations--principally Canada, the Common Market countries, Japan and Brazil--should be expected to drop barriers to the purchase of U.S. telephone equipment.

But those countries have shown little inclination to do so, although Japan has negotiated an agreement designed to clear the way for imports of U.S. equipment.

The bill, on which the Reagan Administration has not taken a firm position, would treat Japan differently because of its existing agreement with the United States on telephone equipment.

The legislation would require the President’s trade representative to study Japanese barriers to telecommunications imports for four months. Then, Reagan would be required to impose retaliatory measures--perhaps quotas or tariffs--within 15 days.

For other countries, after the four-month study the President would be given 14 months to try to negotiate agreements. If that failed, he then would have to retaliate.

Meanwhile, the House Ways and Means Committee held a showcase hearing today on the burgeoning trade gap, as Congress emphasized its concern over import competition that is wiping out American jobs. U.S. Trade Representative Clayton Yeutter and AFL-CIO President Lane Kirkland were among witnesses before the panel.

President Reagan in recent days has promised speeded up moves by Yeutter to persuade trading partners to lower trade barriers.