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WASHINGTON — Commerce Secretary Carlos Gutierrez said Tuesday his agency is on a fact-finding mission as it prepares to launch a major textile import-monitoring system next week amid intensifying pressure to curb surging Chinese apparel and textile exports to the U.S.
Gutierrez laid out the President’s trade agenda in a speech Tuesday at the Washington International Trade Association, but barely touched on China, even as U.S. trade officials met with their Chinese counterparts to discuss a range of issues, including textiles and apparel.
The new secretary, in response to a reporter’s question after the speech, said the launch of the textile import-monitoring system is “all about getting the facts.”
“We will let the process be driven by facts at this point,” he said, sidestepping whether it signaled that the administration is preparing to self-initiate a review of safeguard quotas on China. “We have to put in place the monitoring system and we will see what the facts tell us.”
Gutierrez announced the new monitoring system last week and said it would initially provide textile and apparel import data from the first quarter and be updated biweekly. The new system will eliminate the one-month lag time in reporting import figures and provide the data faster to a coalition of domestic textile and fiber groups that has complained the delay has prevented it from filing market-disruption cases.
China agreed to a safeguard mechanism — or temporary quotas — when it joined the World Trade Organization in 2001. An importing nation can invoke the quotas on apparel and textile exports from China if it determines they are threatening to cause or are causing market disruption, which the U.S. did in 2004 on bras, robes, dressing gowns and knit fabrics.
The domestic coalition filed 12 safeguard petitions based on the threat of market disruption in October, targeting $1.9 billion in Chinese imports for further restraints, but those petitions have been caught up in a legal battle and suspended by a preliminary injunction for three months.
“It shouldn’t take significant review of the facts to discern that China is making massive inroads into the market,” said Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition. “It’s time for self-initiation.”
Tantillo and other coalition members claim a self-initiated review by the interagency Committee for the Implementation of Textile Agreements would significantly streamline the government’s review process, which can take as much as 105 days.
The Bush administration has come under intense pressure from domestic groups, as well as several House textile-state lawmakers calling for the government to self-impose China safeguards. It is difficult to weigh whether the administration will take such an action, particularly in its attempts to garner support for the controversial Central American Free Trade Agreement. Gutierrez said one of the administration’s top priorities this year is to gain Congressional approval of CAFTA, which would allow duty-free trade with five Central American countries — Costa Rica, El Salvador, Guatemala, Nicaragua and Honduras, as well as the Dominican Republic.
CAFTA faces an uphill battle in Congress this year and strong opposition from Democrats challenging the trade treaty’s “weak” labor and environmental provisions, as well as from Republicans and Democrats who represent textile and sugar constituencies. In championing the agreement, Gutierrez said 80 percent of the region’s products already come into the U.S. duty-free under a trade preference program.
“The agreement levels the relationships and gives our companies broader access to the Central American market,” he said, noting it would create the second-largest U.S. export market in Latin America and the 13th largest export market in the world.
He also noted the administration remains committed to the current round of global trade talks that seek to further liberalize trade, and will pursue bilateral trade agreements with Thailand, Panama and four Andean countries — Bolivia, Ecuador, Peru and Colombia.
Meanwhile, a Chinese Ministry of Commerce delegation met with officials from Commerce and the Office of the U.S. Trade Representative on Tuesday under the auspices of the U.S.-China Joint Commission on Commerce & Trade.
Among the issues on the agenda were textiles, China’s bid for a market economy status, export promotion and intellectual property rights enforcement, a Commerce spokeswoman said. U.S. officials did not provide further details about the Tuesday discussions.