FIRMS URGE ANDEAN PACT ACTION

Byline: Joanna Ramey

WASHINGTON — Merino wool sweaters made in sub-Saharan Africa from yarn produced anywhere in the world could enter the U.S. duty free, according to a provision contained in the Andean Trade Preference Act approved Friday by the House Ways & Means Committee.
The provision — actually a technical correction to last year’s apparel-duty-dropping Africa trade bill — was actively being sought by retailers, particularly The Limited, whose plans to boost merino sweater production on the continent have been stymied.
Last year’s Africa bill incorrectly stated that merino wool sweaters made of 18.5 micron yarn could enter duty free. Merino wool, however, is made from 21.5 micron yarn, which the approved correction reflects.
The Andean pact, approved on a voice vote, calls for dropping duties on apparel made in Colombia, Ecuador, Peru and Bolivia, if garments are made from U.S. or regional textiles.
A full House vote on the measure hasn’t been scheduled. Congress is focused on issues involving the aftermath of the Sept. 11 attacks, but a coalition that includes U.S. apparel companies and retailers is urging House Speaker Dennis Hastert (R., Ill.) to make time for an Andean pact vote.
“We urge you not to lose sight of another issue that is also of strategic and economic importance,” the coalition wrote Hastert on Oct. 5. Helping Andean economies is widely viewed in Congress as an antinarcotics strategy.
Signatories of the letter include Gap, Liz Claiborne, J.C. Penney Co., Jones Apparel Group, Kellwood Co., Kmart, Polo Ralph Lauren, Sara Lee, Wal-Mart, The Warnaco Group, Target, the American Apparel & Footwear Association, International Mass Retail Association, National Retail Federation and U.S. Association of Importers of Textiles & Apparel.
If approved by the House, it’s unclear how the Andean pact, with apparel provisions similar to the Caribbean trade bill passed by both houses last year, will be greeted by the Senate. Textile-state senators have been successful in blocking apparel-trade expansion legislation and with U.S. textile makers opposing the ATPA, a fight could be in the wings.
On another trade front, Ways & Means Chairman Bill Thomas (R., Calif.) on Friday put off discussion and a possible vote until today on granting the President trade promotion authority. Thomas’s desire to advance TPA has been slowed by a division between Republicans and Democrats over key labor and environmental standards. The differences threaten the uncharacteristic cooperation between the parties that proceeded the Sept. 11 attacks.
Having TPA means that trade pacts can’t be amended by Congress, only voted up or down. The White House views TPA as key to gaining credibility with trading partners.
Ways & Means Democrats are accusing Thomas of rushing TPA to a vote. The chairman has penned a compromise with some moderate Democrats on the issues, which Rep. Sander Levin (D., Mich.), the top Democrat on the Trade Subcommittee, said Friday “shatters the new spirit of true bipartisanship proclaimed by the President and the leadership of Congress.”
In announcing delay in action on the bill, Thomas said “the American people deserve substantive debate” on TPA. He had originally hoped the bill would be voted out of committee and the entire House by this week, but that schedule is now in doubt.
Meanwhile, another Africa bill correction contained in the Andean bill and approved by Ways & Means involves allowing Botswana and Namibia to use non-African or U.S. fabrics in apparel granted duty breaks. Such exceptions have already been granted to other ultra-poor countries in the region.

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