U.S. AND SINGAPORE TRADE PACT ADVANCES
Byline: Kristi Ellis
WASHINGTON — The Office of the U.S. Trade Representative said it has made “significant progress” in service and rules of origin issues as it concluded the fourth round of negotiations on the U.S.-Singapore Free Trade Agreement in London on Friday.
The USTR said the two sides have set an Aug. 31 deadline for proposed text in most areas.
Intensive negotiations continue on a wide range of topics, including textiles, customs and rules of origin, according to a USTR statement.
The trade pact was launched under the Clinton administration, which made provisions allowing the U.S. to levy sanctions if a country doesn’t enforce labor and environmental laws. While the Bush administration has not excluded such provisions from trade pacts, the big question is how it will address the contentious issue in the Singapore pact.
Although the country accounts for only 0.5 percent of all apparel and textiles imported to the U.S., it remains an important supplier of certain higher-priced items, such as cotton knit shirts.
“We believe the rules of origin should be more liberal than NAFTA’s,” said Julia Hughes, vice president of international trade at the U.S. Association of Importers of Textiles and Apparel. “It should be nothing less than the Breaux-Cardin rules of origin.”
Under Breaux-Cardin, the product must be wholly obtained or produced, knit-to-shape, or wholly assembled from its component pieces in the originating country and the most important assembly operation must occur in that country.
“Initially, we expect the U.S. offer on market access to be rather limited as an opening negotiating position,” said Erik Autor, vice president and international counsel for the National Retail Federation.
The NRF has argued for a three-year phaseout of duties on imports, which average 16 percent, from Singapore as opposed to the typical 10-year phaseout negotiated in most trade pacts. Autor said he supports a model based on the U.S.-Israel FTA — one of the most liberal — though it may not be realistic.