An article in yesterday's editions erroneously listed Rep. Joseph P. Addabbo (D-N.Y.) as chairman of the House Small Business subcommittee on general oversight and minority enterprise. The chairman this year is Rep. John J. LaFalce (D-N.Y.).
The Carter administraction, reacting to heavy criticism, announced yesterday it has renegotiated provisions of its new multilateral trade pact that would have ended the practice of earmarking portions of the government's procurement business for small and minority-owned companies.
Under the change, which was approved formally by both the European Common Market and Japan, small and minority-owned firms will continue to receive preference over large corporations and foreign companies in bidding on U.S. government contracts.
Initial disclosure of the original trade treaty provisions provoked a flurry of criticism from black leaders and small business lobbyists. Years of hard-fought battles had preceded establishment of a special prefernece for minority-owned firms.
Rep. Parren J. Mitchell (D-Md.), a member of the House Small Business subcommittee and a leader of the Congressional Black Caucus, hailed the move as "a breakthrough," and said the shift would "diminish my opposition" to the trade pact when it comes up for Congress' approval.
Mitchell and Rep. Joseph P. Addabbo (D-N.Y.), chairman of the House minority enterprise subcommittee, were expected to schedule a news conference today to applaud the administration's decision.The two had arranged for hearings on the original proposal last week.
White House officials had estimated that the potential loss to minority-owned and small businesses as a result of the original version of the provision would amount to no more than $300 million out of the $18 billion or so in orders now going to those groups. Most big items were exempt.
However, Robert S. Strauss, Carter's special trade representative, conceded yesterday that the issue still was "a terribly difficult one in the minority community, and I can understand their concern." Total federal procurement orders amount to $90 billion a year.
Strauss said negotiators were able to persuade their European and Japanese counterparts to accept the revision with only minor concessions on the part of the U.S. He declined to say specifically what those concessions involved, but sources said they included relatively modest breaks.
At the same time, however, officials said the U.S. has agreed to retain a portion of the original provision that will lift the current preference for businesses in sections of the nation that have surpluses of labor.
The earlier version of the provision was part of a long-standing effort by the administration to obtain wider access for U.S. exporters to procurement contracts let by European governments and Japan.
Sources said the changes will allow U.S. manufacturers to bid on an estimated $25 billion worth of foreign business in exchange for opening up just under $10 billion worth of U.S. government contracts to overseas firms.
Among the changes the U.S. has agreed to make is to relax previous restrictions that required the government to give preference to American firms over foreign companies -- long a sore point with European governments. The shift will apply only to orders totaling $190,000 or more, however.