In accordance with subsection 402(d)(5) of the Trade Act of 1974, I transmit herewith my recommendation for a further 12-month extension of the authority to waive subsection (a) and (b) of Section 402 of the Act.

I include as part of my recommendation my determination that further extension of the waiver authority, and continuation of the waivers applicable to the Socialist Republic of Romania, the Hungarian People's Republic, and the People's Republic of China will substantially promote the objectives of Section 402.

This recommendation also includes my reasons for recommending the extension of waiver authority and for my determination that continuation of the three waivers currently in effect will substantially promote the objectives of Section 402. It also states my concern about Romania's emigration record this year and the need for its reexamination.

Ronald Reagan

The White House,

June 2, 1982.

Recommendation for Extension of Waiver Authority

I recommend to the Congress that the waiver authority granted by subsection 402(c) of the Trade Act of 1974 (hereinafter ``the Act'') be further extended for twelve months. Pursuant to subsection 402(d)(5) of the Act, I have today determined that further extension of such authority, and continuation of the waivers currently applicable to the Socialist Republic of Romania, the Hungarian People's Republic, and the People's Republic of China will substantially promote the objectives of section 402 of the Act. However, I am concerned about Romania's emigration record this year and suggest it be reexamined. My determination is attached to this Recommendation and is incorporated herein.

The general waiver authority conferred by section 402(c) of the Act is an important means for the strengthening of mutually beneficial relations between the United States and certain countries of Eastern Europe and the People's Republic of China. The waiver authority has permitted us to conclude and maintain in force bilateral trade agreements with Romania, Hungary, and the People's Republic of China. These agreements continue to be fundamental elements in our political and economic relations with those countries, including our important productive exchanges on human rights and emigration matters. Moreover, continuation of the waiver authority might permit future expansion of our bilateral relations with other countries now subject to subsections 402 (a) and (b) of the Act, should circumstances permit. I believe that these considerations clearly warrant this recommendation for renewal of the general waiver authority.

I also believe that continuing the current waivers applicable to Romania, Hungary and the People's Republic of China will substantially promote the objectives of section 402 of the Act.

Romania: Emigration from Romania to the United States has increased substantially since the waiver has been in effect. In 1981, nearly 2,400 persons emigrated from Romania to the U.S. This is nearly six times the pre-MFN level of emigration and represents an optimum number of emigrants under U.S. immigration procedures in effect that year.

However, I am gravely concerned about the Romanian Government's failure to improve its repressive emigration procedures and the significant decrease in Romanian Jewish emigration to Israel, which is disturbing. This emigration has dropped from an annual rate of 4,000 prior to the 1975 extension of MFN to Romania, to the current (1981) low level of 972. Furthermore, contrary to the 1979 agreement with American Jewish leaders, Romania continues to maintain a considerable backlog of unresolved long-standing emigration cases. This backlog at present involves at least 652 cases. Also, contrary to the 1979 agreement, the Romanian Government has not improved its emigration procedures. The process is cumbersome and plagued with obstacles for those who merely wish to obtain emigration application forms. All these factors demonstrate Romania's negativistic emigration policy which clearly contravenes the intent and purpose of the Jackson-Vanik Amendment.

In waiving the prohibition of MFN renewal for Romania this year, I have weighed the above factors within the context of the satisfactory state of overall U.S.-Romanian relations. However, I intend to inform the Romanian Government that unless a noticeable improvement in its emigration procedures takes place and the rate of Jewish emigration to Israel increases significantly, Romania's MFN renewal for 1983 will be in serious jeopardy.

Hungary: Hungary's performance during the past year has continued to reflect a positive approach to emigration cases. The majority of Hungarians seeking to emigrate receive permission to do so without great difficulty. Few problem cases arise and these can be discussed constructively with the Hungarian Government. Most difficult cases ultimately are favorably resolved. The relatively liberal Hungarian domestic situation seems to defuse any pent-up demand to emigrate and the actual number of citizens who apply to leave Hungary is apparently small.

People's Republic of China: During the past year, China has continued its commitment to open emigration, exemplified by its undertaking in the September 1980 U.S.-China Consular Convention to facilitate family reunification. The Convention was approved by the Senate on December 17, 1981. The instruments of ratification were exchanged on January 19, 1982. U.S. Foreign Service posts in China issued over 6,920 immigrant visas in FY - 1980, and over 15,293 nonimmigrant visas for business, study, and family visits. The comparable figures for 1980 were 3,400 and 15,893, respectively. More than 8,000 Chinese are now in the United States for long-term study and research (approximately half of this number is privately sponsored). As has been the case for the past several years, the numerical limits imposed on entry to the U.S. by our immigration law continue to be a more significant impediment to immigration from China than Chinese Government exit controls. The Chinese Government is aware of our interest in open emigration, and extension of the waiver will encourage the Chinese to maintain liberal travel and emigration policies.

In light of these considerations, I have determined that continuation of the waivers applicable to Romania, Hungary, and the People's Republic of China will substantially promote the objectives of section 402 of the Act.