U.S. AND COSTA RICA REMAIN AT STANDSTILL ON LOCATION OF UNDERWEAR QUOTA TALKS

Byline: Jim Ostroff

WASHINGTON--The U.S.-Costa Rican talks ordered by the World Trade Organization on the U.S.'s imposition of underwear quota were reportedly caught Tuesday in a standoff over the question of where they should take place.
Each nation has offered to meet Thursday and Friday to settle this contentious issue but only in its own capital--and negotiators weren't budging, sources said.
The U.S., Costa Rica and Honduras must report by Aug. 19 to the WTO's Textile Monitoring Board on the results of such talks. In July, the TMB all but dismissed U.S. claims that underwear imports from Costa Rica and Honduras were damaging itsmarket, but said talks to resolve the controversy should be held.
The U.S. is demanding to talk about nightwear imports, too, less than two weeks after the TMB said quotas on these imports should be rescinded.
Sources here said Caroyl Miller, the acting chief U.S. textile negotiator, as of Tuesday was declining to travel to San Jose, Costa Rica, for consultations beginning Thursday, while Costa Rican negotiators are balking at a trip to Washington. Miller is slated to conclude several days of talks in Colombia today.
The U.S. in March called Costa Rica's underwear exports to the U.S. at 14.4 million dozen, as well as those of three other Caribbean Basin nations, plus Thailand and Turkey.
Subsequently, the U.S. settled with the Dominican Republic, El Salvador and Colombia. By mid-July, during deliberations by the TMB on a challenge to these quotas, the U.S. settled with Turkey and withdrew the call on Thailand. In each case, the countries were given far more access to the U.S. market for shipments of cotton and man-made fiber underwear, category 352/652, than they had prior to the calls.
The TMB by a unanimous vote, found the U.S. did not sufficiently prove economic damage regarding underwear imports from the two unresolved cases with Costa Rica and Honduras. The panel concluded the U.S. also could not prove these imports would pose a future threat. But since there was a split vote on this aspect, it asked the three countries to meet again, with the admonition they should consider the TMB's findings.
The U.S., sources said, is demanding Costa Rica, beginning Thursday, also negotiate on access to the U.S. for cotton and man-made fiber nightwear, category 351/651. The U.S. had called these imports at 157,990 dozen on June 29, three months after the underwear calls and nightwear calls on other nations, but using the same economic rationale as the earlier ones. The TMB, in its July 20 ruling on a nightwear call against Honduras, found unanimously against the U.S.
Meanwhile, the U.S. has invited Honduras to consult in Washington Aug. 10 and 11 on the underwear issue--as well as nightwear imports.
Efforts to reach U.S. textile trade officials for comment were unavailing.
-- Fairchild News Service

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