ATMI LOOSENS POSITION ON AFRICA/CBI TEXTILES

Byline: Joanna Ramey

WASHINGTON — The American textile industry is in the mood to compromise. It has had a change of heart on apparel import-liberalizing legislation for Africa and the Caribbean Basin that backers say bodes well for the bill’s future.
The measure has been stalled for months and faced the likelihood of being shelved this week because House-Senate negotiators couldn’t bridge their differences. The long-standing roadblock: whether apparel receiving trade breaks must be made only with U.S. textiles.
Until late Monday, domestic textile mills, represented by their lobbying arm, the American Textile Manufacturers’ Institute, stood firmly behind a U.S.-fabric-only position, as contained in the Senate version of the bill. Senate leaders, in turn, have been unwilling to compromise much on the fabric issue, citing textile-industry concerns.
Likewise, House trade leaders have demanded there be some leeway in the Senate’s fabric rule, arguing economies of Africa and the Caribbean Basin would benefit more by developing their textile industries. The House bill would allow fabric from either region to be used, in addition to allowances for fabric from other countries.
Fresh air was breathed into the debate late Monday afternoon, the result of a hastily organized conference call of ATMI executive and regular board members. The meeting was held in anticipation of a meeting of House-Senate lawmakers on the bill, a crucial summit that was postponed until today.
After two hours of wrangling, industry officials voted to ease up — however slightly — on their U.S.-fabric-only stance. Twenty-one members of the ATMI’s 40-person board participated in the meeting. Fourteen voted for the compromise, according to sources.
For Africa, the board voted to support a bill allowing some African textiles in covered apparel. A cap on these goods would be placed equal to 1 percent of total U.S. apparel imports the first year, which would then rise to 2 percent, according to sources.
Additionally, for two years, apparel produced in the least developed countries — excluding South Africa, Madagascar and Mauritius — could be made of fabric from other countries in order to encourage the creation of a textile industry. Purely African-made textile imports wouldn’t receive benefits.
For the Caribbean and Central America, the textile industry proposal would allow regionally produced knits to be used in apparel receiving duty breaks, if U.S. yarn is used in the textiles. A cap on these knits of 184-million-square-meter equivalents — the amount imported in 1999 — would also be imposed, sources said.
Doug Bulcao, ATMI’s director of government relations, declined to discuss specifics of the proposal. However, he said “the driving force” behind the change in ATMI’s position was the reality that the trade package could be torpedoed without some compromise by industry on the Africa part of the bill. The textile industry’s interest in the package is with the Caribbean Basin, which already operates under trade breaks beneficial to domestic mills. The ATMI’s backing of a Caribbean Basin compromise regarding knits was the due to yarn spinners pressing for the benefit, Bulcao said.
Roger Chastain, ATMI president and president and chief operating officer at Mt. Vernon Mills Inc., Greenville, S.C., attended the meeting last Thursday with House trade leaders agitating for textile industry compromise on the Africa portion of the bill.
Rep. Charles Rangel (D., N.Y.), who was among the lawmakers pressing the industry at the meeting and is a key negotiator in the trade bill talks, told WWD Tuesday he’s “glad there’s some flexibility” from the industry on the fabric issue. “I had not thought the meeting went well,” he said.
Sen. Charles Grassley (R., Iowa), Trade Subcommittee chairman, said the industry’s change of heart “will make a big difference” in realizing a compromise.
Organized labor continues to oppose any Africa-Caribbean Basin measure. Ann Hoffman, legislative director of the apparel union UNITE, said even if a compromise is reached the package will face stiff opposition in the House.