NEW YORK — Reaching out to a vital industry in an election year, the Obama administration sent Commerce Department officials to the center of American fashion on Monday.
This story first appeared in the March 20, 2012 issue of WWD. Subscribe Today.
A government contingent that included Francisco J. Sánchez, under secretary for international trade at Commerce, and Kim Glas, deputy assistant secretary for Textiles and Apparel, staged a roundtable with major fashion firms and retailers to talk about a range of hot button issues, from trade to the growing movement for Made in America goods.
Discussing the trip immediately after the roundtable, held at the law offices of Squire Sanders at 30 Rockefeller Plaza, Glas said Sanchez earlier toured Ralph Lauren’s headquarters for about an hour and 15 minutes and talked to senior executives there “to better understand how brands and retailers make sourcing decisions and what are all the factors that go into where to source certain products and why,” which she said proved to be a highly educational experience.
“He also was able to learn about the jobs that are supported in the brand and retail industries from design to logistics right down to retail stores,” said Glas, who also serves as chair of the Committee for the Implementation of Textile Agreements. “It gave him a wonderful perspective on the industry.”
Sanchez had to return to Washington right after the roundtable and was not available for comment. But Glas, who oversees programs and strategies to improve the domestic and international competitiveness of the U.S. fiber, textiles, apparel, footwear, fur and leather goods, and travel goods industries, said the diverse group had a chance to address and ask questions on a range of “hot button” topics. The participants included an array of brands and retailers, from Ralph Lauren Corp. to J.C. Penney Co. Inc., that talked about how they make sourcing decisions and discussed a number of trade issues, including the Trans-Pacific Partnership agreement currently being negotiated, the status of the Africa Growth and Opportunity Act, some fixes being made to the Central American Free Trade Agreement, and Haiti, and generally offered “a chance to know the government is engaging the industry and that we look forward to further input from them.”
There was much talk about TPP, a broad regional pact being negotiated between the U.S., Vietnam, Australia, Peru, Brunei, New Zealand, Chile, Malaysia and Singapore, with the potential of Japan, Mexico and Canada also joining the talks. A key point was the issue of rule of origin. The Obama administration has been negotiating on a yarn-forward rule, meaning that components beginning with the yarn must be sourced from the signatory countries to receive duty free status and not a third party, which importers would like.
“The administration has been a strong supporter of a yarn-forward rule of origin, but we are also seeking input from the industry as to what are some other sourcing opportunities for TPP,” Glas noted. “The administration seeks to get an agreement done by the end of this year. There are outstanding issues but we are making good progress.”
As President Obama pushes job creation and as part of his “Investing in America” initiative unveiled in January, the Commerce Department is working to support a movement for the apparel and textile industries to bring more production back to the U.S.
“We have seen a dramatic increase of people contacting our offices looking for Made in America product,” Glas said. “We hope to seize on that momentum of people looking to where can they source products in the United States at the next MAGIC show. At the last MAGIC show in August, Sourcing in the Americas was the focus, with the role our CAFTA and NAFTA partners play in increasing manufacturing in the region. Maybe this time we’ll make Made in the Americas our focus. We’d like to help U.S. companies get the word out that there is finished product that is made here right at home.…Made in USA is not dead.”
Playing into that aim is the White House’s National Export Initiative, a platform created by Obama two years ago in his State of the Union address that set a priority of doubling American exports in the next five years. U.S. apparel and textile exports to the world grew 14.4 percent to $22.2 billion in the year ended Nov. 30 compared with the same period a year earlier, according to the Commerce Department’s Office of Textiles and Apparel.
“We are definitely on track in apparel and textile exports and overall of reaching that goal,” Glas added. “It all goes hand in hand of wanting to make our U.S. companies more competitive. If U.S. consumers are seeking U.S.-made products, that’s wonderful for our businesses and it will mean job growth in the United States, while also seeking new markets abroad. We as a U.S. government have to do a better job of finding who those companies are and share their information with brands and retailers. Consumers are demanding products that say Made in the USA. They are becoming more savvy in looking at the label and where the products are being made.”