U.S. lets Myanmar import ban expire, at least temporarily

WASHINGTON (Reuters) - A U.S. ban on imports from Myanmar expired on Thursday, at least temporarily, because of a clash between lawmakers over funding for an African trade measure.

The two issues are tied together in a bill that has the backing of the Obama administration and that lawmakers hope to pass before their month long August recess.

The White House has eased some sanctions on Myanmar, also known by its colonial name of Burma, in response to economic and political reforms. It does not favor lifting the import ban yet.

Senate Republican Leader Mitch McConnell proposed separating the two measures so the ban on imports from Myanmar could be renewed.

But Senate Finance Committee Chairman Max Baucus, a Democrat, objected on the grounds that it would jeopardize approval of the African trade measure, which he said was vital to clothing industry jobs on the continent.

He rejected McConnell's charge that Democrats were turning renewal of sanctions on Myanmar "into a partisan issue" after years of strong support from both parties.

Baucus said he hoped to worked with Senator Tom Coburn, an Oklahoma Republican, in coming days to address his concerns about funding for the African trade provision.

The African Growth and Opportunity Act, first passed by Congress in 2000, allows eligible countries in sub-Saharan Africa to ship thousands of goods to the United States without paying import duties.

A provision that expires September 30 waives duties on clothing from most African Growth and Opportunity Act countries, even if the yarn or fabric is made in a "third country" like China, South Korea or Vietnam.

Coburn has objected to the use of U.S. Customs Service user fees spread out over 10 years to pay for the $200 million cost of the trade bill.

Those are the types of provisions that have created a huge mountain of U.S. government debt, he said.

(Reporting by Doug Palmer and Richard Cowan; Editing by Stacey Joyce)

(This story was corrected in the first paragraph to make clear that the import ban expired on Thursday, not September)