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Testimony and Comments 200612.05.06 AAFA joined with almost 200 other business organizations and companies, including many AAFA members, in sending a December 1 letter urging Congress to pass a slew of trade-related measures critical to the US footwear and apparel industries before Congress formally adjourns for the year at the end of this week.
In particular, the US business community wants Congress to pass: 1) extensions of the Andean trade preference and the Generalized System of Preferences (GSP) programs, both of which otherwise expire at the end of this year; 2) the Miscellaneous Trade Bill (MTB) (AAFA Support Letter), which provides for duty-free access for a number of US footwear imports as well as some textile products; 3) additional trade preferences for US apparel imports from Haiti; 4) extension of the third-country fabric provisions under the African Growth and Opportunity Act (AGOA); and 5) Vietnam PNTR legislation (See Related Article). Passage of these provisions remain in jeopardy due to: 1) the short amount of time remaining for Congress to act; 2) the uncertainty surrounding passage of the underlying tax extenders package on which the trade measures would be included; and 3) the controversy surrounding some of the trade measures as Congressional leaders hope to pass the legislation without objection and without amendment due the short time remaining in the session. 11.20.06
AAFA joined with more than a dozen other companies, business associations and prominent non-governmental organizations in sending a November 13 letter to Congressional leaders urging them to pass legislation sponsored by retiring House Ways & Means Committee Chair Bill Thomas (R-CA) before Congress adjourns its "lame-duck" session in December. The legislation would provide new preferences for Haiti, extend and expand the third-country fabric provisions in the African Growth and Opportunity Act (AGOA) and extend the Generalized System of Preferences (GSP) program.
11.14.06
Dumping duties against US-branded footwear in Mexico, import quotas and licensing requirements imposed on US-branded footwear in Argentina, new safeguard measures against US-branded footwear in Brazil, Turkey, Jordan and elsewhere, onerous labeling requirements proposed for US-branded apparel in Korea and excessive documentation requirements for US-branded apparel elsewhere are just a few of the barriers to US-branded footwear and apparel worldwide listed in AAFA's November 8 comments for the US government's next annual National Trade Estimate Report on Foreign Trade Barriers. The US government utilizes the report to determine priorities for its trade agenda for the next year.
10.25.06
The National Council of Textile Organizations (NCTO) on October 19 formally endorsed US free trade agreements with Peru and Colombia. While both agreements, completed last winter and spring, contain virtually all of the restrictive provisions sought by the US textile industry, the industry had failed to endorse the agreement until last week. The US textile industry's support for the agreements clears one of the many hurdles blocking Congressional approval of each agreement. While the Bush administration is pushing for a Congressional vote on the US/Peru Trade Promotion Agreement in November, its fate remains uncertain.
Meanwhile, AAFA submitted comments October 16 to the US government on the US/Colombia Trade Promotion Agreement. AAFA applauded the agreement's footwear provisions, but expressed deep disappointment with the agreement's restrictive apparel and textile rules. AAFA, however, urged the US government to immediately address the impending gap between expiration of the duty benefits under the Andean Trade Promotion & Drug Eradication Act (ATPDEA) at the end of this year and the implementation of the Colombia agreement. AAFA joined more than a dozen businesses and non-governmental organizations and companies in sending an October 5 letter to key members of Congress and Bush administration officials urging them to extend the third-country fabric provisions under the African Growth and Opportunity Act (AGOA). There is still some hope that Congress will address this issue in its "lame-duck" session after the elections in November
10.17.06
AAFA joined a group of other leading trade associations and major US apparel retailers, importers and apparel manufacturers in sending an October 11 letter to the Bush administration insisting that the Bush Administration rescind a commitment handed to two textile state senators to self-initiate dumping cases against US imports of Vietnamese apparel in return for dropping their objections to Senate consideration of Permanent Normal Trade Relations (PNTR) legislation for Vietnam.
The letter's signatories condemned the deal, noting that it politicizes the normally transparent and objective anti-dumping process, by committing the US government to self-initiate dumping cases for political reasons on behalf on an industry that otherwise would not have standing under US law or international trade rules to bring such a case. The letter stated that the deal, unless rescinded or otherwise vitiated, would likely have a negative impact well-beyond the apparel and textile industries by seriously jeopardizing Vietnam's chief export earning industry and, in turn, jeopardizing Vietnam's ability, or willingness, to buy US manufactured or agricultural products or utilize, or provide licenses for, US service providers. Echoing that sentiment was an October 6 letter from the American Chamber of Commerce in Vietnam to President Bush expressing grave concern that the commitment to self-initiate dumping cases could endanger the benefits of PNTR and Vietnam's entry into the World Trade Organization (WTO) for US exporters and US service providers. While the furor over this deal casts the timing into doubt, President Bush still hopes Congress approves PNTR before he leaves for Vietnam November 17 to attend a regional summit. Congress must approve PNTR for US exporters and service providers to enjoy the opening of the Vietnamese market that will occur when Vietnam joins the WTO, which is expected before the end of the year. Regardless of whether Congress has passed PNTR, the United States will eliminate all quotas on imports of Vietnamese apparel and textiles when Vietnam joins the WTO 10.12.06
AAFA and other organizations sent a September 28 letter to members of Congress urging them to approve the AAFA-supported Miscellaneous Trade Bill (MTB) as soon as possible. Among the hundreds of provisions in the MTB are dozens of AAFA-supported provisions that would allow certain types of footwear, apparel, textiles and backpacks to enter the United States duty-free.
9.26.06
Senate leadership has signaled that a vote could happen this week on legislation offered by Senators Charles Schumer (D-NY) and Lindsey Graham (R-SC) that would impose a 27.5 percent tariff on China in retaliation for China’s alleged currency manipulation. Schumer and Graham have threatened to force a vote all year, but have repeatedly delayed it to give the Administration more time to deal with China through bilateral consultations.
Although Treasury Secretary Henry Paulson recently concluded a trip to China, at which a new “economic dialogue” on trade and currency issues was announced, the two Senators seem ready to push forward on the vote anyway. Ironically, Senator Schumer was quoted last week as opposing enactment of the bill, stating, “Obviously, we don't want our legislation to take effect.” Conventional wisdom suggests there is strong support for the legislation in the Senate, which had earlier in the year defeated a motion to table the legislation. Continued frustration over China, combined with slow progress in achieving a significant revaluation of the Chinese currency, have led many to speculate that the Senate will approve the legislation if it is put to a vote. Many observers agree that there is little chance the House will approve, or the President would enact, the legislation. AAFA signed onto a multi-industry letter last week to oppose the legislation, noting that it violates international trade rules and that it would undermine progress that has been made on these bilateral issues thus far. 9.19.06
AAFA sent a September 6 letter to California Governor Arnold Schwarzenegger urging him to veto SB927, which would require new container fees at California ports. Governor Schwarzenegger has until the end of September 2006 to sign or veto the bill, but could make a decision as early as next week.
SB927 requires the ports of Los Angeles and Long Beach to impose a $60 container (feu) fee to fund undefined transportation, clean air and port security programs. AAFA and others believe SB927 is unconstitutional on several grounds and, more importantly, will drive business away from California ports. While Governor Schwarzenegger has vetoed such measures in the past, a series of powerful national and state interests have lined up to support the bill, blaming poor air quality and road congestion in southern California on big corporations moving freight through San Pedro Bay. Several polls suggest that these arguments are playing well among likely California voters. In fact, the Los Angeles Times and other major newspapers have already issued editorials in support of SB927. Therefore, AAFA urges AAFA members to immediately mail and fax letters to Governor Schwarzenegger with the subject line -- Attention: Legislative Unit: Veto Request -- urging him to veto the legislation (see AAFA letter for address and fax number). Please fax copies of your letter to Mr. Richard Costigan, Deputy Chief of Staff and Legislative Affairs Secretary (Fax# 916.327.1009) and Mr. Michael Prosio, Deputy Legislative Secretary (Fax# 916.327.1009). Please also share your letters with AAFA's Nate Herman. The US Senate on September 14 unanimously approved (98-0) legislation to improve port security (H.R. 4954). The AAFA-supported legislation, which is similar to the Security and Accountability for Every (SAFE) Port Act passed by the US House of Representatives in May, would require Customs to put in place pilot programs and increase funding to improve technology that would eventually allow screening of virtually all incoming cargo for nuclear materials. The legislation would also increase requirements for participants in Customs' Container Security Initiative (CSI) and the Customs-Trade Partnership Against Terrorism (C-TPAT) program.
The Senate successfully fought off two AAFA-opposed amendments that would have immediately required 100 percent radiation screening of US-bound cargo before it left foreign ports. With time running short before the end of the legislative session and November Congressional elections, the House and Senate must now meet in conference to reconcile the differences between the House and Senate-passed versions of the legislation. 9.11.06
The US Senate is expected to approve legislation to improve port security (H.R. 4954) this week. The AAFA-supported legislation, which is similar to the Security and Accountability for Every (SAFE) Port Act passed by the US House of Representatives in May, would require Customs to put in place pilot programs and increase funding to improve technology that would eventually allow screening of virtually all incoming cargo for nuclear materials. The legislation would also increase requirements for participants in Customs' Container Security Initiative (CSI) and the Customs-Trade Partnership Against Terrorism (C-TPAT) program.
AAFA and others, however, sent a September 7 letter to the Senate opposing any amendment that would immediately require 100 percent radiation screening of US-bound cargo before it leaves foreign ports. The fate of the amendment is uncertain at this time. AAFA sent a September 7 letter to California Governor Arnold Schwarzenegger urging him to veto SB927, which would require new container fees at California ports. Governor Schwarzenegger has until the end of September 2006 to sign or veto the bill, but could make a decision as early as next week. SB927 requires the ports of Los Angeles and Long Beach to impose a $60 container (feu) fee to fund undefined transportation, clean air and port security programs.
AAFA and others believe SB927 is unconstitutional on several grounds and, more importantly, will drive business away from California ports. While Governor Schwarzenegger has vetoed such measures in the past, a series of powerful national and state interests have lined up to support the bill, blaming poor air quality and road congestion in southern California on big corporations moving freight through San Pedro Bay. Several polls suggest that these arguments are playing well among likely California voters. In fact, the Los Angeles Times has already issued an editorial in support of SB927
Therefore, AAFA urges AAFA members to immediately send letters to Governor Schwarzenegger urging him to veto the legislation. Further, AAFA encourages AAFA member CEOs and other senior executives to call the governor's Chief of Staff Susan Kennedy at 916.445.5106 to register their opposition to SB927. Please share with AAFA your letters and phone calls. Despite overwhelming bipartisan support, it appears that legislation to grant Vietnam Permanent Normal Trading Relations (PNTR) status will fall prey to election year politics. With both parties looking to avoid any trade vote before the November Congressional elections, it seems that a vote on Vietnam PNTR will not occur until a proposed November post-election "lame-duck" session of Congress at the earliest.
Almost the entire US business community, including AAFA, however, continues to push for approval of Vietnam PNTR as soon as possible. Approval of PNTR is required for US businesses and farmers to enjoy increased market access to the Vietnamese market as part of Vietnam's World Trade Organization (WTO) accession, which is expected to occur in November. On a bright note, however, the opinion prevailing in Washington, DC currently is that the United States must eliminate its apparel and textile quotas on Vietnam when Vietnam joins the WTO, regardless of whether Congress has approved PNTR or not. For this reason, AAFA joined with other organizations in sending a September 6 letter to the Vietnamese government urging them to not delay their WTO accession. There have been growing rumors that Vietnam would delay its WTO accession in protest of Congressional delays in approving Vietnam PNTR. The US International Trade Commission (ITC) on September 5 released its long-awaited report on the possible economic impact of redefining baby booties under the Harmonized Tariff Schedule of the United States (HTSUS). Even with extensive comments from AAFA and others, the report found that, of two possible definitions, the first one would have no impact, but could not make a definitive determination on the second definition. The purpose of the report was to define baby booties separately under the HTSUS and,, as a result, remove US imports of Chinese baby booties from safeguard quotas under the November 2005 US/China Bilateral Safeguard Agreement.
9.7.06
AAFA sent a letter August 14 to Guatemalan President Oscar Berger congratulating Guatemala on joining the US/Central America-Dominican Republic Free Trade Agreement (CAFTA), but expressing concern about the surge in gang violence in the country. Guatemala has already responded to the letter by crafting a plan to fight the gang viol, ence. In related news, th, e US Department of Homeland Security's Bureau of Customs & Border Protection (Customs) issued a new ruling July 13 allowing for the use of certain non-originating sewing thread -- textured polyester 200 denier single multifilament yarn that is dyed, finished with a sewing lubricant, “Z” twisted, and put up on reels weighing less than 1000 grams -- under CAFTA. As a result, apparel made in a CAFTA country from third-country subject yarn can enter the United States duty-free under CAFTA.
Meanwhile, the US government's inter-agency Committee for the , Implementation of Textile Agreements (CITA) received an August 17 petition from Lido requesting that certain two-way stretch fabrics, classified under 5515.11.00 of the Harmonized Tariff Schedule of the United States (HTS), in which both warp and filling yarns are a blend of chief weight polyester staple mixed with viscose rayon staple, plied and wrapped around a core of filament spandex yarn be declared not available in commercial quantities in a timely manner under CAFTA. The rebuttal period has already closed without any rebuttals being submitted. If CITA approves the petition, apparel made in a CAFTA country from third-country subject fabrics can enter the United States and any other CAFTA country duty-free under CAFTA. AAFA submitted comments August 11 to the Senate Finance Committee in support of the dozens of provisions in Congress' Miscellaneous Trade Bill (MTB) that would temporarily eliminate duties on certain types of footwear, apparel, textiles and related products. Congress is expected to consider and approve the overall MTB legislation sometime this fall.
AAFA blasted US im, port restraints on apparel, footwear and travel goods in comments submitted August 11 to the US International Trade Commission (ITC). The comments, submitted for the ITC's annual report on The Economic Effects of Significant Import Restraints detailed the immense costs these restraints have on US consumers, particularly low-income families while providing little, if any, benefit to those the import restraints are supposed to protect.
8.11.06
AAFA joined with more than a dozen other companies and organizations in sending an August 8 letter to the House leadership urging Congress to extend the third-country fabric provisions of the African Growth and Opportunity Act (AGOA) until 2015. Under current law, AGOA's third-country fabric provisions will be reduced by 50 percent on October 1, 2006 and eliminated completely on October 1, 2007. In related news, the United States Trade Representative (USTR) announced that, effective August 4, US imports of AGOA-eligible products from Burkina Faso now qualify for textile and apparel benefits under AGOA.
7.26.06
The US House of Representatives approved implementation of the US/Oman Free Trade Agreement (FTA) on July 20 by a vote of 221-205 (See AAFA Key Vote Letter). The US senate had already approved the measure on July 11. Congressional approval of the US/Oman FTA hopefully clears the way for Congressional passage of other important trade measures before the end of the year, including Vietnam Permanent Normal Trading Relations (PNTR), co-production fixes for the US/Central America-Dominican Republic Free Trade Agreement (CAFTA) and the US/Peru Trade Partnership Agreement.
AAFA submitted written testimony to the House Ways & Means Committee in reference to their July 12 hearing on the US/Peru Trade Partnership Agreement. AAFA applauded the free trade agreement's footwear provisions while criticizing the agreement's flawed apparel provisions. Nevertheless, AAFA urged Congress to quickly approve the agreement as the best way to continue, without interruption, the current duty-free status for apparel products made in the region using regional inpu, ts. The Andean Trade Promotion & Drug Eradication Act (ATPDEA), which currently offers these benefits, expires at the end of this year. Prominent members of Congress have indicated that Congress will likely not renew ATPDEA before it expires.
On the eve of the conclusion of the second round of negotiations on a US/Malaysia Free Trade Agreement (FTA) in Washington, DC, AAFA and the Malaysian Textile Manufacturers Association (MTMA) on July 21 issued a joint press release urging negotiators to recognize that the FTA must be beneficial to both the US and Malaysian textile and apparel industries, with sufficient flexibility built into the agreement to maintain and grow the viable partnership between Malaysia and the United States now and into the future. The second round of negotiations for the US/Malaysia Free Trade Agreement as well as for the US/Korea FTA, which concluded, July 14 in Seoul, yielded litt, le progress in regards to apparel, footwear and textiles. Negotiators will meet again on both FTAs in September, with the goal of completing the agreements by the end of the year.
7.19.06
The Senate Finance Committee held a hearing July 12 on legislation granting Vietnam Permanent Normal Trading Relations (PNTR) status (See AAFA's testimony). The tenor of the hearing was overwhelmingly positive, fueling hopes that Congress could make substantial progress towards approval of Vietnam PNTR legislation before Congress' August recess. Furthering the positive momentum for the legislation, over 130 companies and organizations representing virtually the entire US business community, including AAFA and many AAFA members sent a July 12 letter to Congressional leadership urging quick passage of Vietnam PNTR legislation. That letter followed a July 11 eminent persons letter to Congressional leadership signed by 18 prominent former US Secretaries of State and Treasury, US Trade Representatives and National Security Advisors supporting quick Congressional approval of Vietnam PNTR. A major Vietnam Veterans group also recently wrote in support of Vietnam PNTR. Vietnam will likely join the World Trade Organization (WTO) this fall. If Congress passes PNTR legislation by the time of Vietnam's PNTR entry, the United States will immediately eliminate quotas on US imports of apparel and textiles from Vietnam. In return, Vietnam will significantly open its market to the distribution and sale of US-made and US-branded apparel, footwear and textiles as well as all other US products and services.
AAFA sent a July 12 letter to US Secretary of Commerce Carlos Gutierrez requesting the Secretary to correct press statements regarding the urgency of implementation of the US/Central America-Dominican Republic Free Trade Agreement (CAFTA) and urged the Secretary and his staff to recommit to implementing CAFTA both correctly and quickly. Due to continued delays in implementation of the agreement and the resulting co-production problems they cause, US apparel imports from and US textile exports to the CAFTA region continue to slide (See latest AAFA chart as well as related article below). AAFA continues to work with the Bush administration and Congress to resolve the problems generated by staggered implementation of CAFTA.
According to published reports, the Chinese government plans a major overhaul of its management rules governing apparel quotas. The purpose of the overhaul is to prevent unused quota as US imports from China in the categories covered by quota so far this year have fallen and much quota has gone unused. Meanwhile, AAFA submitted comments July 11 to the US International Trade Commission (ITC) regarding the ITC's ongoing study on proposed definitions for baby booties. The purpose of the study is to determine if baby booties are defined separately from baby socks, and therefore removed from the current China safeguard quotas, would it have any impact on domestic manufacturers. US imports of baby socks from China were included at the last minute in the November 2005 US/China Bilateral Textile Agreement, which re-imposed safeguard quotas on US imports of a number of types of apparel and textiles from Ch, ina through 2008. Because of the structure of the current Harmonized Tariff Schedule (HTS), US imports of Chinese baby booties were also inadvertently subject to quotas under the agreement.
On July 12, the Judiciary Committee reported H.R. 2965, the Competition in Contracting Act of 2006 out of committee. This was the second attempt to report the bill after having to pull it from consideration approximately one year ago over a substitute amendment, sponsored by Rep. Steve Chabot (R-OH). The Chabot amendment went down 28 to 9 this round, and no other weakening amendment, s were added. This legislation will phase-out the mandatory source for FPI, which will open up opportunities for private contractors by requiring that FPI compete for contracts. H.R. 2965 also provides additional training and educational programs that have a better rate of reducing recidivism. AAFA has been a long-time supporter of this legislation and will continue to work with Congress to ensure House passage this year. Similar legislation has passed the House in the past; however, the Senate will be a much greater challenge.
6.28.06
AAFA and a number of AAFA members joined over 100 other companies and organizations representing the entire US business and agricultural community in sending a June 21 letter to Congressional leadership urging Congress to immediately consider and pass legislation implementing the US trade agenda. Specifically, the signatories urged Congress to immediately pass legislation implementing Vietnam Permanent Normal Trading Relations (PNTR) status, the US/Oman Free Trade Agreement and the US/Peru Free Trade Agreement. Despite overwhelming US business and agricultural community support, Congressional consideration of these measures has stalled due to the current politically contentious environment in Washington, DC.
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6.20.06
Concerned about growing signs that the ongoing Doha Round of global trade talks continue to falter, the US business community, including AAFA, sent a strongly-worded letter June 12 to the trade negotiators of the 150 WTO member countries clearly stating that action is needed now and that any agreement must be ambitious or the US business community will withhold its support for the agreement. The 150 WTO member countries still seem far from reaching a deal for the framework of an agreement ahead of a late June deadline. Meanwhile, Turkey last week introduced yet another proposal to remove apparel and textiles from the tariff-cutting requirements of the overall deal and instead create a separate "sectoral" agreement where there will be little, if any, reductions in apparel and textile tariffs worldwide.
6.13.06
In letters sent June 6 to Congressional leaders and the Bush administration (See AAFA Press Release), AAFA urged Congress to quickly renew the current ban on imports from Burma (the ban expires in August). AAFA also urged the Bush administration to do more to encourage other countries to impose similar sanctions against Burma. The international community, led by the International Labor Organization (ILO) and the United Nations, has universally condemned the deplorable human and labor rights situation in Burma.
In a June 5 letter to Senate Finance Committee Chair Charles Grassley (R-IA), AAFA urged Congress to include new trade benefits for the Commonwealth of the Northern Marianas Islands (CNMI) in current trade legislation moving through Congress. The legislation would allow duty-free access for apparel entering the United States from the US territory if 30 percent of the value-added was performed in the CNMI, down from the current 50 percent requirement.
AAFA President and CEO Kevin M. Burke sent a letter to Representatives Marsha Blackburn (R-TN) and Jan Schakowsky (D-IL) thanking them for recently introduced legislation that modernizes the Wool Labeling Act. Specifically, the legislation revises the labeling requirements for certain wool and cashmere products set forth in 1939 when the original act was created. The AAFA is appreciative of the bill’s incorporation of “supers” as accepted terminology used to identify the quality of a wool product. The original Wool Labeling Act of 1939 failed to reflect the current market practice of using “supers” as an international identifier of the quality of wool products. The AAFA is eager to aid in moving this legislation forward, and hopes to assist Blackburn and Schakowsky in any way possible.
5.10.06
The 150 countries of the World Trade Organization (WTO) missed their self-imposed April 30 deadline to reach an agreement on the framework ("modalities") for an agreement in the ongoing Doha Round of global trade talks. With the passage of the deadline, the AAFA-supported American Business Coalition for
4.18.06
On April 13, nine prominent non-apparel, non-retail US business organizations representing a broad swath of the US business community sent a letter to US Trade Representative (USTR) Rob Portman expressing strong opposition to a recent proposal by the government of Turkey to exempt textiles and apparel from trade liberalization in the ongoing World Trade Organization (WTO) Doha Round of global trade negotiations. Echoing a similar letter that had been sent by AAFA and several apparel and retail organizations in late March, the groups expressed concern that the proposal could create incentives for other countries to try to exclude other sectors critical to US businesses and the US economy from, trade liberalization in the 150 country global trade talks. The business groups urged the US government to oppose the Turkey proposal. On April 13, nine prominent non-apparel, non-retail US business organizations representing a broad swath of the US business community expressing strong opposition to to exempt textiles and apparel from trade liberalization in the ongoing World Trade Organization (WTO) Doha Round of global trade negotiations. Echoing a in late March, the groups expressed concern that the proposal could create incentives for other countries to try to exclude other sectors critical to US businesses and the US economy from trade liberalization in the 150 country global trade talks. The business groups urged the US government to oppose the Turkey proposal.
4.11.06
Shortly after an April 2 election marred by an opposition boycott, Prime Minister Thaksin Sinawatra resigned and appointed, a caretaker Prime Minister. It, is now likely a new electio, n must be called to restore a government because the opposition boycott left over one-thi, , rd of all seats in Thailand's Parliament vacant. As a r, esult of the ongoing political turmoil, no new date has been set for restarting talks towards a US/Thailand Free Trade Agreement. Further, the turmoil has delayed the planned April 2 signing , of the Japan/Thailand Free Trade Agreement. AAFA sent a letter April 5 to the Bush administration urging the administration to quickly address industry concerns about the implementation of the ski and snowboard pants exemption under the US/China Bilateral Safeguard Agreement. Under the agreement, all ski pants are supposed to be exempted from quota. AAFA has received reports, however, that the US Department of Homeland Security's Bureau of Customs & Border Protection (Customs) has instead interpreted the agreement to only allow pants where all seams are sealed and all pockets are enclosed to be exempted from the quota. 4.3.06
Turkey's March 23 proposal to remove apparel and textiles from the overall negotiations in the ongoing Doha Round of World Trade Organization (WTO) negotiations created a firestorm last week, with even the head of the WTO stepping into the fray. The AAFA-opposed proposal, which is very vague, would exempt apparel and textiles from all market opening measures agreed to in the overall negotiations on industrial and consumer goods. Instead, it would attempt to "harmonize" apparel and textile tariffs at some unspecified level in a separate "sectoral" agreement. AAFA and others believe that this proposal would not only hurt apparel exporters, US apparel firms and consumers in the United States and around the world, but that such a proposal could jeopardize the entire Doha Round because the proposal would exclude an , industry critical to such a large part of the developing world. Despite these warnings, International Trade Daily quoted US Trade Representative (USTR) Rob Portman last week as saying the proposal was "a constructive contribution" and that "a sectoral approach in some kind of textiles might make sense." Meanwhile, according to Women’s Wear Daily, a USTR spokeswoman also stated last week that "the US believes that this is a discussion that must be [led] by the developing world, and that is why we appreciate Turkey’s initiative in submitting its proposal." US officials are quick to assure, however, that the United States has not formally endorsed the proposal. On the other side, WTO Director General Pascal Lamy, in an unusually harsh statement for a senior WTO official, told the press that removing apparel and textile from significant trade liberalization "...would in my view be very strange, and that, by the way, was the reaction of a large part of the [WTO] members." While some smaller apparel exporting countries expressed support for Turkey's proposal, Lamy's views were indeed echoed by most larger apparel exporters, who expressed strong opposition to the proposal. Negotiators from the 149 WTO member countries face a deadline of April 30 for developing the "modalities" or structure of the negotiations to lower worldwide trade barriers for apparel, footwear, textiles and all other products so that the negotiations can conclude by the end of the year as scheduled. 3.27.06
In March 24 comments submitted to the US government's inter-agency Committee for the Implementation of Textile Agreements (CITA), AAFA complimented CITA on the interim CAFTA short supply regulations issued by CITA as a great step forward in streamlining and bringing greater transparency to the short supply process. AAFA urged CITA, however, to fix specific parts of the interim regulations in order to bring even greater clarity and transparency to the process for all interested parties as well as the general public. AAFA joined with a number of US and European retailer, travel goods and importer associations in opposing a March 23 Turkish proposal to remove apparel and textiles from the overall negotiations in the ongoing Doha Round of World Trade Organization (WTO) negotiations. The proposal, which is very vague, would exempt apparel and textiles from all market opening measures agreed to in the overall negotiations on industrial and consumer goods. Instead, it would attempt to "harmonize" apparel and textile tariffs at some unspecified level in a separate "sectoral" agreement. While US government officials, Europe and many small apparel exporting countries expressed initial support for the proposal, many larger apparel exporting countries denounced the proposal. In a view echoed by many in the US business community, one major apparel exporting country representative warned that if apparel and textiles are carved out, it could lead to the demise of the entire Doha Round. In its March 22 letter to the ambassadors from all 149 WTO member countries, AAFA and other associations urged them to reject any effort to separate apparel and textiles from the rest of the negotiations into a trade restricting sectoral because such an approach would be a step backwards that would benefit no one - developing countries, industrialized countries or world trade in apparel and textiles. Negotiators from the 149 WTO members countries were meeting in Geneva last week to discuss proposals for reducing tariffs and other trade barriers for all consumer and industrial products, including apparel and textiles. Any decision in the Doha Round, including any decision to carve out apparel and textiles, must be reached by consensus among the 149 WTO member countries.
In March 24 comments submitted to the Office of the US Trade Representative (USTR) and the US International Trade Commission (ITC), AAFA urged the US government to negotiate a commercially-meaningful free trade agreement with Korea for the US apparel, footwear and textile industries. Specifically, the US government should negotiate flexible rules of origin for apparel that not only embody flexible rules for product no longer made in the United States, but robust cumulation and short supply provisions to ensure that the agreement is not only commercially-viable today, but remains so into the future. On footwear, the agreement should include flexible rules of origi, n and immediate and rec, iprocal duty-free entry for vi, rtually all footwear. The comments, , which also outline other AAFA goals for the proposed free trade agreement, were in response to USTR and ITC requests for information for use in their investigations on the potential economic effects of a US/Korea Free Trade Agreement.
3.22.06
AAFA warned that the "approval" by European Union (EU) member states of a European Commission (EC) proposal to impose preliminary anti-dumping duties of 19.4 and 16.8 percent, respectively, on EU leather footwear imports from China and Vietnam was a "s, erious economic mistake.", , Although only 3 out of the 25 EU member states actually voted for the Commission’s proposal in the March 16 meeting of the Commission's Anti-Dumping Committee and 11 member states voted against it, the 11 other member states abstained. Under EU rules, an abstention is technically considered a vote "in favor" of the Commission’s proposal. Therefore, the Commission's recommendations were carried on a 14 (3 Yes + 11 Abstentions) to 11 vote. Based on this vote, EU Tra, de Commissioner Peter Mandelson announced shortly after the vote that the member states "approved" his proposal and that he will impose the preliminary dumping duties after the Commission formally approves the recommendations on March 22. The dumping duties, which could last up to five years, are in addition to the normal 8 percent tariff already imposed on European footwear imports. The dumping duties will go into effect on April 7. Because this was the first known vote ever where approval of EU dumping duties was actually done by an overwhelming number of abstentions, a number of importer/retailer groups as well as a number of member states have indicated that they will continue to fight the proposed duties. However, many expect the next fight will occur in late summer when the European Commission must recommend whether, and at what level, definitive dumping duties will be imposed in the case. For the latest information on the EU dumping issue, please join AAFA's EU Footwear Dumping Task Force by contacting Nate Herman at 703.797.9062. AAFA joined with a number of retailer, travel goods and importer associations in urging the US government to oppose any effort to thwart trade liberalization for apparel and textiles in the ongoing Doha Round of World Trade Organization (WTO) negotiations. In its March 10 letter, the associations urged the Bush administration to reject US textile industry efforts to separate apparel and textiles from the rest of the negotiations into a trade restricting sectoral approach. Further, the groups opposed any efforts to re-impose a worldwide quota regime or extend or expand the current China safeguards. Negotiators from the 149 WTO members countries are meeting in Geneva this week to discuss proposals for reducing tariffs and other trade barriers for all consumer and industrial products, including apparel and textiles.
The US government's in, teragency Committee for the Implementation of Textile Agreements (CITA) rejected on March 14 an AAFA-opposed petition requesting that CITA revoke a "short supply" designation under the Caribbean Basin Trade Preference Act (CBTPA) and the Andean Trade Promotion & Drug Eradication Act (ATPDEA). The January 10 petition from the National Council of Textile Organizations (NCTO) urged CITA to revoke the designation that certain compacted, plied, ring-spun cotton yarns, with yarn counts in the range from 42 to 102 metric, classified in subheadings 5205.42.0020, 5205.43.0020, 5205.44.0020, 5205.46.0020, 5205.47.0020 of the Harmonized Tariff Schedule of the United States, cannot be supplied by the domestic industry in commercial quantities in a timely manner under CBTPA, which allows apparel from the Caribbean Basin, Central America and the Andean region using third country subject yarn to enter the United States duty-free. NCTO alleged that a sufficient "substitutable product" was available. CITA rejected NCTO's claims, determining yet again that the subject yarns cannot be supplied by the domestic industry in commercial quantities and in a timely manner and that NCTO has not substantiated that ring spun yarns currently produced by the domestic industry are substitutable for the subject compact, plied yarns.
President George W. Bush signed H.R. 32, the Stop Counterfeiting in Manufactured Goods Act, last week at a ceremony attended by AAFA staff. This legislation was a priority for AAFA as the legislation strengthens the laws against, counterfeiting in labels, including the mandatory destruction of equipment used to manufacture the labels. This legislation closes a loophole that allowed counterfeiters to circumvent the law by allowing the shipment of fake labels as long as they were not attached to the goods. This is a tactic that has been used widely to cheat consumers and undermine the success of legitimate brand owners of apparel, footwear and accessories. The Bush Administration and Congress, working closely with industry, have made great strides in the fight against counterfeiting and piracy in the United States and abroad. AAFA will continue to work with the Administration and Congress to further this effort through additional legislation and cooperation with our industry to provide the information needed to improve policies and regulations.
3.7.06
A broad coalition of trade associations representing every sector of the US business community, including AAFA, sent a letter February 22 to U, S Trade Representative Rob Portman strongly opposing any effort to include a China-style safeguard in Vietnam's World Trade Organization (WTO) accession agreement. The letter expresses concern that the United States would likely lose other important concessions , from Vietnam - in areas such as market access, services and intellectual property rights - if it forced Vietnam to accept a safeguard. Vietnam hopes to join the WTO by the end of this year. The US government has repeatedly stated that quotas on US apparel imports from Vietnam will remain in effect until Vietnam formally joins the WTO. 3.6.06
<, div>AAFA recently submitted comments on the JWOD program making recommendations on how the governance standards for nonprofit agencies participating in the JWOD program might be refined and evaluating the Committee approach to setting fair market value for products. AAFA’s comments focused on the adherence to a firm definition of severely handicapped, compliance enforcement and violation procedures. AAFA advocates more efforts on behalf of the JWOD governing committee to ensure that the program is benefiting those for whom the program was developed. A broad business coalition, including AAFA, sent a March 1 letter to Congressional leaders urging restraint as Congress reviews the sale of port management operations at six US ports to United Arab Emirates' (UAE)-owned Dubai Ports World. The letter notes that foreign investment in shipping terminals at US ports has been a long-standing trend. Yet, while foreign companies may own and operate these terminals, US national security at our ports has been and will continue to be managed by the US government, including US Customs and Border Protection and other units of the US Department of Homeland Security. All companies that operate in US ports, including Dubai Ports World, must adhere to high security standards set by the US government. The letter argues that the United States must maintain a fair and objective foreign investment review process that ensures US national security, while still encouraging investment that strengthens the US economy. Not only is foreign investment vital to the growth of the US economy, but so is the protection of US investment abroad. The letter urges Congress to approach this issue in such a way as to not jeopardize either. 2.28.06
US Trade Representative Rob Portman announced February 24 that it will recommend to President Bush that the United States implement the US/Central America-Dominican Republic Free Trade Agreement (CAFTA) with El Salvador on March 1. The implementation will become official with the issuance of an official proclamation by the White House and supplemented with guidance from Customs and others on regulations and technical issues covering key things like how to make entry, what exactly will qualify and how retroactivity refunds (for apparel and textiles) can be obtained. There had been some speculation that Nicaragua might make the March 1 deadline but apparently they couldn't get their domestic business completed so they may end up being part of an April 1 announcement. Honduras is also shooting for the April 1 announcement. Guatemala will be sometime later, possibly April or May. The Dominican Republic is looking at July 1 and Costa Rica still remains an open question, although news that former President Oscar Arias may have won the recount (and thus will be the next Presid, ent of Costa Rica) suggests that CAFTA may be approved in Costa Rica later this year. While countries like Honduras, Guatemala and the Dominican Republic were delayed largely because of non-textile and apparel issues, there are talks on-going with those countries on the pocket fabrics issue and, possibly, socks, which remain two pieces of business left over from the Congressional debate this past summer. AAFA continues to aggressively lobby for resolution of the many co-production issues that the March 1 entry into force with respect to El Salvador creates. In essence, on March 1, El Salvador ceases to be a Caribbean Basin Trade Partnership Act (CBTPA) country and starts becoming a CAFTA country. On that date, El Salvador will not be able to use CBTPA inputs since there is no apparent provision in CAFTA to do that. Similarly, since no other , Central American country will be an implemented CAFTA country, Salvador will not be able to use any inputs from other non-US CAFTA signatory countries when origin rules would normally have permitted inputs from other Central American countries. (Ironically, the reverse is not the case. CBTPA countries can continue to avail themselves of CBTPA and CAFTA inputs for goods that meet the CBTPA rules of origin). The problem will begin to resolve itself naturally (and slowly) as the other countries make the transition from CBTPA to CAFTA. But the interim will cause many problems. Pl, ease note that this problem will not affect the footwear provisions of CAFTA. Bush administration officials have told AAFA that they are acutely aware of this problem and will work with Congress on ways to secure refunds for goods entered during this transitional period and which have to pay duty (even though they shouldn't be subject to duty). There may still be other options the Administration can pursue with recourse to Congress. Others in Congress and in the CAFTA governments have been raising this issue at the highest levels as well. The United States Trade Representative reviews the compliance of our World Trade Organization (WTO) partners yearly under Section 182 of the Trade Act of 1974. AAFA submitted comments on the "special 301" highlighting the importance of brand protection, the need, for increased enforcement in many countries as well as clarification as to what an infringement entails. As with many other industries, China remains at the helm for Intellectual Property Rights (IPR) violations. AAFA encouraged a thorough review of some other specific countries as recommended by AAFA member companies.
2.21.06
While last-ditch efforts are ongoing for a US/Colombia Free Trade Agreement (FTA), AAFA sent a letter February 16 along with over 30 other trade associations urging US Trade Representative Portman to negotiate a comprehensive and commercially meaningful agreement. 2.6.06
In a letter sent February 3 to the US government's inter-agency Committee for the Implementation of Textile Agreements (CITA), AAFA disputed CITA's authority to even consider any petitions to revoke, much less actually revoke, a "short supply" designation under the Caribbean Basin Trade Partnership Act (CBTPA) or the Andean Trade Promotion & Drug Eradication Act (ATPDEA). AAFA notes that there is absolutely NO authority whatsoever to revoke short supply designations in the statutes. Furthermore, in Congressional report after Congressional report accompanying trade preference program and free trade agreement implementing legislation, Congress explicitly and repeatedly states that CITA has absolutely no authority to revoke "short supply" designations under CBTPA and ATPDEA. The letter is in response to a CITA request for comments on a January 10 petition from The National Council of Textiles Organizations (NCTO) requesting that CITA revoke its designation that certain compacted, plied, ring spun cotton yarns are not available from the domestic industry in commercial quantities in a timely manner (in "short supply") under CBTPA and ATPDEA. NCTO claims that "substitutable yarns," not the yarns designated in short supply, are now commercially available. Posted February 6, 2006 1.30.06
Join with Peru and the United States in a proposed, US/Andean Free Trade Agreement, AAFA sent a letter to the Bush administration reiterating the apparel and footwear industries' goals for the FTA. AAFA also joined with other associations in sending letters to the Bush Administration and to Colombian President Álvaro Uribe urging that cumulation be included in the agreement's final provisions. Testimony, Comments and Letters - 2005
Testimony, Comments and Letters - 2004 Testimony, Comments and Letters - 2003 and Prior |
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