WASHINGTON — The American Apparel & Footwear Association is doubling down on building support for the Trans-Pacific Partnership in the heat of a contentious presidential election campaign steeped in antitrade rhetoric, while helping executives navigate through other challenges such as counterfeiting and cyber security.
“If you are a politician, it is fashionable to say trade takes jobs away,” said Rick Helfenbein, president and chief executive officer at the AAFA at the group’s executive summit, themed “Disruption, Innovation, Transformation,” that wrapped up here on Thursday. “What we need to do…is we need to explain that trade creates jobs. It’s just that the jobs [trade does create] are different and they are often higher-paying jobs.”
A priority for AAFA will be boosting efforts to support the TPP, which involves the U.S., Australia, Japan, Mexico, Canada, Vietnam, Malaysia, Peru, Singapore, Chile, Brunei and New Zealand. The industry has a big stake in the TPP, but a drawn-out presidential primary campaign that has seen Democratic and Republican candidates rail against the negative impact of trade deals on U.S. jobs, along with a rising unease in the American public about trade, has cast a shadow over TPP this year.
“No trade deal is perfect. They’re just not. But what is going on now is politicians exploiting the potential of short- term loss without selling the longer-term gains,” Helfenbein added. “This is just wrong. It is not good for America and somebody needs to stand up to it.”
If TPP is delayed by even a year, AAFA’s members could collectively lose more than $1 billion in duty savings that would not be realized, he noted.
On a positive note, Helfenbein said there has been a “noticeable uptick in the urgency” of getting TPP cued up for Congressional consideration this year, adding, “Some of that reflects the political uncertainty of the moment, suggesting of course that it would be easier to do it now than next year.”
Rob DeMartini, president and ceo of New Balance Athletics Inc. and the AAFA’s new chairman, outlined the association’s three-year strategic plan that will be focused on providing expertise in three areas: brand protection, supply chain management and trade.
Industry veteran Paul Charron said the prospects for TPP are “very good” and that the Obama administration is pushing it hard.
“I think the majority of Republicans will see that it is the right thing to do,” he said. “All of the tension in the country, or anger and frustration [about trade] will raise a lot of questions, but when all is said and done, I think it will be approved. It’s a great trade program.”
Tom Glaser, vice president and president of global supply chain at VF Corp., said Vietnam represents a “robust” business for VF and the entire industry.
Glaser said there is also still momentum behind Made in America and Western Hemisphere production.
“We have significant printing operations here. We make uniforms here and we make some jeans in the U.S.,” he said. “I think there is a real opportunity to do more in this hemisphere and we are constantly doing that.”
VF also has a large footprint in Mexico, which uses a lot of U.S. yarns and fabrics. He said the Mexican peso has “changed substantially over the last 24 months and that has made it a little more competitive than it was in the past.”
Levi Strauss & Co., which has a small percentage of premium denim production in the U.S., is also considering ways to expand here, said Chip Bergh, president and ceo of Levi Strauss.
“When it comes to Made in America, I read the consumer letters that come to the company and there are a lot of [people] that want to see us bring production back to the U.S.,” Bergh said.
The company does have some premium denim products that are made in the U.S., Bergh noted.
“So at the price points that can support it, we want to do more of it [in the U.S.],” Bergh said. “In fact, the meeting I just had here was talking to a supplier that makes product here in the U.S. So we’re trying to do the right thing. We are looking at if we can expand beyond what we are doing today, but it’s not going to be a big part of our business because the majority of our business in the U.S. is selling at $40 a pair roughly and you can’t make money-making product in the U.S. [at] that kind of selling price.”