WASHINGTON — The U.S. and Vietnam reached a tentative agreement on a quota-setting bilateral textile and apparel pact Wednesday and officials will continue to work out the final details today, according to Jim Leonard, deputy assistant secretary of textiles, apparel and consumer goods industries at the U.S. Commerce Department.
This story first appeared in the April 17, 2003 issue of WWD. Subscribe Today.
Leonard, reached by phone Wednesday at the end of the sixth day of negotiations, said the deal covers a number of categories but he refused to say how many and at what levels the quotas have been set.
“We are talking about [quota] numbers, text, circumvention, market access and labor issues, and we just want to make sure we have a clear understanding with the Vietnamese on what the issues are,” said Leonard. “I don’t think there are any major [outstanding] problems, but we just want to make sure we are clear on what we agreed upon.”
Meanwhile, importers made a final push in a letter to U.S. Trade Representative Robert Zoellick late Wednesday to increase quota levels on two high-volume import categories: cotton knit shirts and cotton knit trousers and shorts.
“Arguments that Vietnam is being offered large quota levels on [cotton] knit shirts and [cotton] pants are disingenuous and illusory,” claimed Laura Jones, executive director of the U.S. Association of Importers of Textiles and Apparel.
The USA-ITA claimed, in the letter, to have learned that the U.S. had offered quotas of 14 million dozen cotton knit shirts a year and 7 million dozen cotton trousers and shorts a year. Representatives of the USA-ITA were not present at the negotiations and the importers’ group did not say how it had obtained those numbers.
Leonard declined to confirm the numbers. Members of the Vietnamese delegation could not be reached.
In any case, until the negotiators sign off on a final agreement, the quota amounts could change.
“Any time you have a negotiation, you have misunderstandings and I want to make sure it is all squared away,” he said. “Plus, I am going to take enough flak once it is announced.”
The quota issue has caused a rift between U.S. negotiators and domestic textile and import trade and lobby groups, who have stepped up the pressure.
Jones predicted trade from Vietnam will embargo “well before the end of the year,” based on the preliminary information.
Cass Johnson, associate vice president of international trade at the American Textile Manufacturers Institute, said he would be “astonished” if Jones’ numbers in cotton knit tops and cotton trousers were accurate.
“If these numbers are accurate, it’s going to be extremely costly to workers in this country,” said Johnson. “[Importers] are talking about shaving a quarter off the price of a pair of pants and we are talking about closing mills and laying off thousands of workers.”
U.S. negotiators have had an extremely tough balancing act in these negotiations.
The Bush administration in a deal in 2001 to garner enough House votes to renew the president’s trade promotion authority, agreed to help domestic mills better compete with foreign suppliers. But the interest of importers and retailers must also be taken into account.
Leonard, addressing the concerns of importers, said they have known all along apparel and textile categories would be controlled by quotas.
“There were a lot of categories [importers] did not want covered but some of those are going to be covered,” said Leonard. “That should not be a surprise. The surprise may be the level but those categories that have been covered shouldn’t be a surprise.”