In Novel Move, U.S. Reviews Effects of Boycott on American Businesses

In a move hailed by the Jewish community, the Clinton administration has ordered the first government study on what effect the Arab economic boycott against Israel is having on U.S. companies.

The U.S. trade representative, Mickey Kantor, last week asked the U.S. International Trade Commission to conduct a "carefully researched assessment of the impact of the boycott on U.S. firms."

The United States historically has concerned itself with the boycott’s negative impact on Israel. This action focuses attention on how the boycott affects U.S. trade.

The so-called primary boycott affects trade with Israel directly, barring economic dealings between Israel and Arab states, other than Egypt.

The secondary and tertiary boycotts affect U.S. companies doing business with Israel by blacklisting companies with economic ties to Israel as well as commerce with companies that do business with blacklisted companies.

Rep. Charles Schumer (D-N.Y.), chairman of a congressional task force on the boycott, said in a statement that the report "could very possibly lead to U.S. trade retaliation against countries enforcing the boycott."

Kantor’s letter asks the trade commission to analyze how the boycott affects U.S. businesses in three ways: lost sales and business opportunities in Arab League countries, increased transportation costs resulting from the boycott, and investment diverted from U.S. businesses because of their association with Israel.

The letter requests the trade commission’s report to be completed within a year.

In New York, the Conference of Presidents of Major American Jewish Organizations hailed the announcement of the study, calling it a "major, positive step" that will "promote further progress in resolving the Israel-Arab conflict while expanding trade and investment opportunities for American businesses abroad."

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