WASHINGTON — The domestic textile industry on Thursday filed four new safeguard petitions with the Bush administration aimed at restricting $735.3 million worth of Chinese imports.
The petitions cover wool suits, man-made fiber coats, polyester filament fabric and cheesecloth, and come a week after domestic groups applied to renew nine safeguard cases representing imports of $3.4 billion.
China agreed to the safeguards, which limit growth to 7.5 percent and can be renewed through 2008, when it joined the World Trade Organization in 2001. It since has complained that they run counter to the spirit of free trade, however. The safeguard mechanism was intended to help producers transition out of the 30-year-old system of quotas that expired in January.
Increasingly hungry for less-expensive Chinese goods, importers also oppose the safeguard quotas, in part because they can fill unexpectedly and create uncertainty.
American and Chinese negotiators will sit down to a fifth round of talks in Washington on Monday in hopes of reaching a comprehensive import agreement that, in theory, could protect domestic producers from import surges and provide importers with a more stable landscape.
“The U.S. textile industry will keep filing safeguard petitions until all categories of interest to us are covered or the Chinese agree to a reasonable comprehensive agreement,” Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition, said in a statement. “So far, China has not been serious about negotiating a deal.”
Importers were wary about the reasoning behind the new cases.
“These seem a little bit out of the blue and the timing is suspect,” said Julia Hughes, vice president of international trade at the U.S. Association of Importers of Textiles & Apparel. “The domestic industry seems to be filing these cases more for political reasons than the substance of disruption.”
The domestic industry, however, sees restricting Chinese imports as one of its top priorities and a matter of survival.
There have been 31 U.S. plants that have closed this year, as Chinese apparel and textile imports, through July, shot up 45.8 percent to 9.43 billion square meters equivalent. Overall imports in the same time frame were up 8.1 percent to 28.96 billion SMEs.
This story first appeared in the September 23, 2005 issue of WWD. Subscribe Today.
Domestic producers argue, however, that Chinese goods are driving prices down unduly, as production is subsidized by an undervalued currency, nonperforming loans and other unfair trade practices.
“Since quotas have expired … 128 apparel and textile workers have lost their jobs every single day,” said Bruce Raynor, president of the union UNITE HERE. “The crisis is now. If safeguards aren’t implemented, more plants will close and thousands of workers will be without jobs.”
AMTAC and UNITE filed the new safeguard petitions, along with the National Council of Textile Organizations and the National Textile Association.
The administration has until Oct. 13 to decide if it wants to consider the new petitions. Acceptance would trigger a 30-day public comment period.