WASHINGTON — Congress passed trade legislation Thursday that extends benefits to U.S. companies making apparel in sub-Saharan Africa and separately helps U.S. textile producers and apparel importers doing business in Central America.
The bill, which now goes to President Obama for his signature, also extends a ban on imports from Myanmar that was imposed in 2003 after a military junta began repressing human rights, despite the current regime’s recent reforms.
House Ways & Means committee chairman Dave Camp (R., Mich.) said: “I recognize the encouraging developments in Burma over the past months. Nevertheless, in 2003 Congress set out specific goals and benchmarks in the Burmese Freedom & Democracy Act, and I encourage the Burmese government to continue to address the concerns that led to the passage of the law. I also urge the Burmese government to vigorously pursue further reforms, economic growth and peaceful, inclusive governance that benefit all the Burmese people.”
Sub-Saharan African countries had been losing apparel business this year, according to the U.S. Trade Representative’s office, because of uncertainty over whether Congress would approve an extension of a key provision that helps firms doing business in 25 designated least-developed countries to use fabrics from outside the region and still receive duty-free benefits when shipping to the U.S. The bill extends the third-country fabric provision through Sept. 30, 2015 and adds the Republic of South Sudan to the list of countries eligible for duty-free benefits on apparel, textiles and footwear imports.
The legislation also contains provisions to make technical changes to apparel and textile rules of origin in the Central American Free Trade Agreement that was welcomed by textile mills and apparel importers.
“The AGOA third-country fabric benefit and the CAFTA fixes will not only help U.S. brands and retailers create needed jobs at home, but will also better enable these companies to provide high-quality, yet affordable, apparel to American families,” said Julia Hughes, president of the U.S. Association of Importers of Textiles & Apparel.
It also closed a “loophole” that allowed the use of thread from outside the region that caused “American sewing thread manufacturers lost business to producers from China and elsewhere in Asia,” said Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition. “By closing it, we are confident that U.S. thread producers can begin to recapture market share in the CAFTA region, leading to more jobs and increased U.S. exports,” noting about 1,800 workers are employed in sewing thread manufacturing in the U.S.
Some in the industry were disappointed that the legislative package did not include other trade measures passed in committees. Senate and House committees have each passed bills granting permanent normal trade relations to Russia, which will allow the U.S. to gain full benefits of Russia’s accession to the World Trade Organization this month. However, it appears the full Congress will not vote on the measure before the monthlong August recess set to begin Monday. Congress must approve PNTR in order for U.S. firms to gain benefits such as lower trade barriers and better market access to Russia.
The package also didn’t include funding for the Cotton and Wool Trust Funds or a pima cotton promotion, putting those programs on hold.
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