WASHINGTON — The Bush administration sought to show progress in its efforts to improve conditions in the beleaguered textile and apparel industries Wednesday, as it unveiled its first textile report to Capitol Hill lawmakers.
This story first appeared in the September 19, 2002 issue of WWD. Subscribe Today.
While some textile industry representatives lauded the administration for singling out the sector, many dismissed the report as a political paper touting the government’s existing programs as opposed to tangible improvements and action.
The 20-page report highlights steps the administration’s task force has taken in the past few months to address specific textile industry problems. Among the highlights the administration touted in the report are:
l Resisting demands by developing countries in the World Trade Organization talks to accelerate the quota phaseout set to expire on Dec. 31, 2004 and demanding these countries lower their tariffs before the U.S. agrees to lower its tariffs.
l Strong opposition to weakening antidumping and countervailing duty laws in the course of the WTO talks.
l Addressing 25 compliance issues with a variety of countries, with special attention to India, Egypt, Pakistan, China, Mexico and Brazil. In July, Pakistan dropped duties on 55 textile products requested by the U.S. The U.S. is addressing issues such as export subsidy programs in countries like India, which give those producers an unfair competitive advantage, burdensome marking and labeling requirements, and tariff rates in excess of WTO tariff bindings.
l U.S. Customs’ seizures of $300 million in transshipments from 162 factories that were closed down as the result of U.S./Hong Kong Customs joint efforts from May 2001 through May 2002. Since March, Customs had seized or excluded about $1.78 million worth of illegally transshipped goods claiming Russian origin.
l A chargeback of $28 million against China’s quotas last December.
l Development of a “watch list” of 280 foreign trade measures and practices in more than 70 countries.
l Export expansion programs through trade missions and trade shows.
l Encouraging trade partners to diversify their economies into non-textile sectors. The U.S. recently advised Turkey that textiles could not be included in its proposed Qualified Industrial Zone.
l Streamlining trade adjustment assistance as part of the recently passed 2002 Trade Act.
l The State Department has contacted over 65 embassies abroad to analyze the impact of quota removal on respective textile and apparel industries, and research the possibilities for diversification into other industrial sectors.
Bush administration officials have been working to fulfill pledges made to GOP lawmakers who voted for trade promotion authority. The promises are largely centered on expanding U.S. textile and apparel exports through negotiations and trade show promotions and stepping up enforcement of imports to ensure foreign textiles and apparel aren’t circumventing quota and other requirements.
Critics claim the focus on the textile industry is just an election-year ploy and only duplicates long-standing programs in place.
The report, sent to the Hill on Wednesday, was compiled by the administration’s task force known as the Textile Working Group, an interagency group created to help the faltering domestic textile industry.
In a teleconference, Jim Leonard, deputy assistant secretary of Commerce for textiles, apparel and consumer goods industries, insisted the administration is committed to helping the textile sector, although he could not point to specific improvements, such as an increase in domestic jobs or U.S. exports.
“I’ve spent over 30 years in the textile industry and I’ve heard every president in every administration make commitments to this industry,” Leonard told reporters. “But this is the first time I’ve seen strong evidence the administration is keeping its commitments, although we can’t do everything the industry wants.”
Leonard reiterated that the task force is not merely duplicating the role of the Committee for the Implementation of Textile Agreements, which he chairs. He claimed it is more high profile, involves more agencies and is much broader in scope.
Leonard, responding to a question on how the administration will move forward on requests by other countries such as Pakistan for enhanced trade benefits, said the U.S. has denied all other requests. He noted that Pakistan, which asked for apparel and textile benefits in exchange for its help in the war against terrorism, only received 10 percent of what it requested.
In the event the U.S. goes to war with Iraq and countries like Turkey ask for economic help, the U.S. is not prepared to give textile and apparel breaks, Leonard said.
“We are taking a fairly strong position and we are not in the business of making concessions — period,” he said.
Leonard said Commerce is looking into establishing a joint venture with the Department of Energy to evaluate existing technology to better track transshipments from countries that receive preferential market access from the U.S.
“These are examples, not of rhetoric, but of initiatives the administration is taking to be responsive to the industry,” he said.
Despite these assurances, there were mixed reactions from textile industry representatives to the administration’s first report, which they have been waiting on for the past nine months.
“We’re waiting to see real results, not results saying they didn’t give Bangladesh or Pakistan what they wanted,” said Jock Nash, Washington counsel for textile giant Milliken & Co. “We want help, not the promise to prevent further harm, and I’m waiting to see what initiatives they are taking for that.”
While Nash commended Leonard, Grant Aldonas, undersecretary of international trade at Commerce and chair of the task force, and Commerce Secretary Donald Evans for singling out textiles, he quickly noted there are no real results yet, despite the report that touts results.
“It’s primarily a political document right now,” Nash claimed. “We are way past the rhetoric stage and we are looking for tangible results, over and above good governance.”
Nash said he was looking for tangibles: CITA reimposing quotas on certain imports from China, denying Bangladesh extra quota to bring in cotton trousers that have been embargoed since the end of July or the initiation of a bilateral textile and apparel pact with Vietnam.
The American Textile Manufacturers Institute, in a statement, took a more conciliatory tone, commending the administration on its current efforts, but also calling for more progress.
“Secretary Evans’ update on the Bush administration’s efforts to help the U.S. textile industry shows that a broad array of textile issues continue to receive attention at the highest levels of our government,” ATMI chairman Van May said in the statement.
However, May noted that 33 more textile plants have closed in the U.S. since the task force was created in January, including six in the past two weeks. He also criticized the government, noting the same textile export markets that were closed one year ago remain closed today and the plethora of tariff and non-tariff barriers to U.S. textile exports also remain. Surges in Asian imports from China, Taiwan and South Korea continue to impact the domestic industry.
“Important government tools for opening such markets, such as the withholding of growth rates on quota increases, withdrawal of [generalized system of preference] benefits and the filing of WTO cases remain, to date, unutilized,” said May.