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 combating the piracy of CDs and software compilations on CD-ROMs, it will be identified as a priority foreign country as early as April 1998."

Today, Ambassador Barshefsky stated, "We have actively engaged both Paraguay and Bulgaria in negotiations to address our concerns. We are pleased that both governments have begun to recognize their responsibilities and have made some limited progress toward resolving our concerns this year. However, to avoid further action by the Administration, it is essential that both governments, over the next several months, take significant, effective, and sustained enforcement actions to substantially reduce piracy and provide adequate and effective intellectual property protection."

Also this year, on March 30, Ambassador Barshefsky announced that the Administration suspended a portion of Honduras' benefits under the Generalized system of Preferences (GSP) and Caribbean Basin Initiative (CBI) because of its failure to control piracy of TV satellite signals. Today, Ambassador Barshefsky noted that, "On April 23, the Government of Honduras took its first steps toward resolving this dispute by taking action against two pirate stations. We are encouraged by this action, and look forward to additional actions to fully resolve our concerns."

Ambassador Barshefsky noted the substantial progress made during this past year in improving intellectual property protection, including progress in countries whose practices have been major IPR concerns in the past.

Progress has occurred throughout the world, much of it the direct result of U.S. Government pressure. While more needs to be done in many of these countries, progress has occurred in such countries as China, Brazil, Russia, Turkey, Bolivia, Korea, Ireland, Sweden, Panama, Cyprus, San Marino, and Luxembourg, and most recently in Bulgaria and Singapore. An attachment to this release, entitled, identifies the specific progress made with these and other countries.


 * There has been continued progress in China. Through 1995, China was the world's leading exporter of pirated optical media products -- compact discs (CDs), video discs (VCDs), software CD-ROMs (containing software and video games) -- where illegal exports of optical media products cost U.S. industry over a billion dollars. In contrast, losses from optical media exports in 1997 were down very significantly according to industry estimates. Since the 1996 agreement, China has shut down 64 CD production lines and largely reduced exports of pirated IPR products. According to Chinese Government statistics, more than 800 individuals have been imprisoned in China as a result of illegal IPR piracy activities.

Ambassador Barshefsky stated, "We have seen continued progress in reducing illicit IPR