PACE OF ENDING QUOTAS SCORED BY 40 RETAILERS
Byline: Jim Ostroff
WASHINGTON — Forty U.S. retail executives have signed a letter to Commerce Secretary Ron Brown and U.S. Trade Representative Mickey Kantor to protest the administration’s schedule for phasing out apparel and textile import quotas.
They argue the schedule is a ploy “to benefit U.S. textile and apparel manufacturers.”
Under the terms of the GATT Uruguay Round, the U.S. is mandated to have about half of its textile and apparel trade quota-free by 2002. This integration is to take place in three stages. The remaining 50 percent is to become quota-free by Jan. 1, 2005.
Writing under the banner of the National Retail Federation and detailing the criticism already sounded by importers and retailers, the executives argue that the schedule proposed by the U.S. Committee for the Implementation of Textile Agreements “frustrates the intent of the GATT agreement, harms consumers and prevents a reasonable phase-in of integration that would actually assist the domestic textile industry in making transitional adjustments.”
Although Brown and Kantor are not CITA members, Rita Hayes, a deputy assistant Commerce secretary, and Jennifer Hillman, the chief U.S. textile negotiator with USTR, are members, along with others from the Departments of State and Labor. Hayes serves as CITA chairman.
“Our hope is that [Brown and Kantor] will intercede, let the CITA people know they are hearing from industry, and that the integration list should be made more consumer-friendly,” said Robert Hall, an NRF vice president.
The letter, delivered to Brown and Kantor Tuesday evening, claimed that in the first three-year integration stage that began Jan. 1, the CITA schedule included no products that were under quota. The executives stated that when the final two phases of partial integration are concluded, 89 percent of apparel products currently under quota and 68 percent of textiles now under quota will remain under quota. This “effectively imposes a regressive tax on the American consumer to benefit U.S. textile and apparel manufacturers,” the retailers wrote.
CITA has set a March 20 hearing on its quota-phaseout plan for the final two stages, which will be issued officially by May 1.
Domestic textile and apparel manufacturers’ associations have praised the proposed phaseout schedule, asserting they need as much time as possible to adjust to a quota-free trade world in which low-cost Far Eastern producers conceivably could dominate the U.S. market. The domestic interests further assert that the phaseout plan’s other provisions to increase quotas during the 10-year period will effectively double foreign makers’ access to the U.S. market.
Retailers and importers counter that growth provisions are meaningless when applied to suppliers like China, with an average 1 percent quota growth.
The retailers also averred that implementation of the CITA plan would hurt U.S. credibility as it pushes other nations to eliminate trade barriers to U.S. products.
“Numerous U.S. apparel brands, such as Levi jeans, Jockey underwear and Hanes hosiery, are world renowned,” but foreign consumers often are unable to buy them due to trade barriers, the executives wrote. “Our efforts to pry open foreign apparel markets would be greatly enhanced if our negotiators were not handicapped by this perception of an uneven playing field,” the letter said.
Signing the letter are such top retailers as James E. Oesterreicher, vice chairman of J.C. Penney Co.; Allen I. Questrom, chairman of Federated Department Stores; Leslie H. Wexner, chairman of The Limited; Donald Fisher, chairman of The Gap; Arthur C. Martinez, chairman, Sears Merchandise Group; Thomas A. Hays, deputy chairman, The May Department Stores Co.; Bernard F. Brennan, chairman, Montgomery Ward; Al Cottle, executive vice president, Nordstrom Inc.; Robert J. Tarr Jr., president, Neiman Marcus Group, and Sally Frame Kasaks, chairman of Ann Taylor. — Fairchild News Service