BID TO LIFT RAYON DUTY GETS TANGLED

Byline: Joanna Ramey

WASHINGTON — South Carolina’s Sens. Ernest Hollings and Strom Thurmond thought they were just doing a favor for the U.S. textile industry when they tossed into the hopper a bill dropping duties on imported rayon yarns.
Rayon is not made in the U.S. but is commonly used by U.S. textile makers in producing coat linings, sportswear and tires.
Duty-elimination requests by lawmakers are also fairly common in Congress and are typically one of the least controversial topics found on Capitol Hill. If an import isn’t made in the U.S., then lawmakers figure that no one will complain about foreign competition. The real bonus is that U.S. companies using a duty-free import will save some money.
But Hollings and Thurmond’s intention of giving their constituents a break has faced nothing but controversy, underscoring the long-standing, volatile mix of textiles and politics.
The first to fire a salvo were textile and apparel importers, who found the senators’ request to be protectionist even though there is no rayon made in the U.S.
Laura Jones, executive director of the U.S. Association of Textile and Apparel Importers, questioned why the senators — in supporting the elimination of 10 percent duties on imports of rayon yarn — would at the same time be so opposed to non-U.S. yarn and fabric being given duty-free treatment under pending duty-dropping legislation for Caribbean Basin and sub-Saharan African apparel.
The USA-ITA for years has been battling Hollings and Thurmond, whose allegiance to their textile-producing state has made them among the most protectionist members of the Senate. At 97, Thurmond, a Republican, is the Senate’s senior lawmaker and has been representing textile interests in Congress since 1954, when he was a Democrat. Hollings, 78, a Democrat, has demonstrated his industry loyalties since first elected in 1966.
The USA-ITA’s protest was quickly followed by that of two U.S. textiles companies, Celanese Americas Corp. and KoSa. The large fiber firms don’t make rayon, but they do make products easily substituted for the yarn and thus they complained of unfair import competition.
“KoSa’s philosophy is one of free trade, but we believe in fair trade,” said Dick Osman, director of new textile fiber development at KoSa.
The rayon yarn is in competition with KoSa’s high-tenacity filament yarns used in tires.
“It appeared to us this was someone trying to create a loophole to get an advantage for their business,” Osman said.
Celanese produces acetate fibers used in coat linings and women’s sportswear, which can be a substitute for rayon, said a spokeswoman for Celanese.
“In certain areas, they are a competing fiber,” the spokeswoman said.
While the importers’ complaints didn’t carry enough weight in the Senate, the opposition raised by Celanese and KoSa was enough to send the Hollings and Thurmond bill into the political graveyard. After all, this usually friendly business of duty suspensions does have one rule: If any U.S. business complains, then Congress won’t even vote on the request.
“The bill has been withdrawn,” said Charles Bremmer, director of international trade for the American Textile Manufacturers Institute, which first broached the idea of dropping the rayon duties. “The rule of the game is, if it’s controversial, it’s withdrawn.”
Hollings and his staff weren’t available for comment. However, Thurmond’s spokeswoman said it’s only proper to drop the rayon yarn request, but noted it was originally made because the product isn’t made in the U.S.

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