WASHINGTON — In an effort to increase its lobbying muscle on Capitol Hill and in the Obama administration, four textile lobbying and trade groups have begun exploring the possibility of a merger.
This story first appeared in the May 17, 2012 issue of WWD. Subscribe Today.
Bill Jasper, chairman of the National Council of Textile Organizations and also president and chief executive officer of Unifi Inc., said Tuesday at the close of the group’s annual meeting here that NCTO, the American Manufacturing Trade Action Coalition, National Textile Association and American Fiber Manufacturers Association — four of the most active textile and fiber groups in Washington — have begun talks on how best to represent the industry, and a merger is one of the options being considered.
“I think there is an opportunity to have a much more significant role and a more significant influence in what happens in trade legislation by having a bigger influence in Congress,” Jasper told his members.
“AMTAC, NTA, AFMA and NCTO are having joint meetings right now to talk about how do we best represent the industry together,” Jasper said. “That may include bringing two, three or four associations into one association — one super association. I think that could happen.”
Jasper said a decision on a merger will be made by the end of the year.
A source familiar with the talks, who requested anonymity, said, “It could be a possible merger but it might just be other ways that we can improve our outreach in Washington.”
The textile industry has gone through major downsizings over the past decade, while associations that represent its interests in Washington have gone through restructuring. One of the biggest splits in the industry came in 2000, when the late textile titan Roger Milliken, chairman of Milliken & Co, split with the American Textile Manufacturers Institute, a highly influential lobbying and trade group.
In the early Nineties, Milliken was a staunch opponent of the North American Free Trade Agreement and threw his support behind H. Ross Perot’s unsuccessful 1992 bid for the presidency because of the candidate’s opposition to NAFTA. While executives like Guilford Mills Inc. chairman Charles Hayes decided to back NAFTA, Milliken began to see the government as having abandoned the U.S. textile industry and said it was time for a fight.
A few months after the split, ATMI announced a substantial round of downsizing as a result of its lower dues base and smaller budget. The organization was dissolved in 2004 and a new textile trade and lobbying group — NCTO — sprung up in its wake with a new charter, bylaws and legal entity.
In May 2002, Milliken joined forces with Union of Needletrades, Industrial and Textile Employees president Bruce Raynor and Cranston Print Works Co. chairman and ceo George Shuster to form a new textile lobbying group, the American Textile Trade Action Committee. ATTAC was later succeeded by the American Manufacturing Trade Action Coalition.
The Trans-Pacific Partnership free-trade negotiations between the U.S. and eight other countries could significantly impact trade flows in the textile sector and is an example of why the industry is seeking a stronger, more unified posture in Washington.
The textile industry has galvanized around pushing for strict apparel and textile rules of origin in the TPP negotiations between the U.S. and Vietnam, Singapore, Australia, Malaysia, New Zealand, Peru, Brunei and Chile. There is concern that a country like Vietnam, which the U.S. industry says has a heavily subsidized textile and apparel industry, could decimate U.S. textile producers if it is given duty-free benefits under a flexible rule of origin in the TPP.
The U.S. has proposed a yarn-forward rule, supported by the domestic textile industry, which requires that apparel be made of fabric and yarns supplied by the U.S. or other TPP signatory countries to qualify for duty-free benefits when shipped back to the U.S. However, apparel brands and retailers have formed a coalition to lobby against the yarn-forward rule and argued instead for a more flexible rule of origin, which they are seeking to be structured in a way that would allow them to use yarns and fabrics in the apparel made in the TPP region from anywhere in the world, and primarily from China.
In a press call Wednesday, Barbara Weisel, the chief negotiator for the TPP and assistant U.S. trade representative for Southeast Asia and Pacific Affairs, which just wrapped up the 12th round of TPP negotiations in Dallas, said there was a “productive exchange on textile rules of origin.
“All sides understand each other’s positions very clearly and we have the opportunity inter-sessionally to consider how to move forward to narrow the gap on that issue,” she said.
Fashion industry officials have said that Vietnam, the second-largest supplier of apparel to the U.S., is seeking a much more flexible rule of origin than what the U.S. has proposed, though Weisel would not comment on that country’s proposal.