CBI-AFRICA GUIDELINES CLEAR A HURDLE
Byline: Jim Ostroff
WASHINGTON — Companies planning to use new trade perks to source apparel in the Caribbean Basin and in sub-Saharan African countries will need to be selective about where they work.
The Clinton administration on Monday evening said that apparel made in 24 CBI and 34 sub-Saharan African nations using U.S. textiles is eligible to receive duty- and quota-free benefits. However, there are some important caveats.
Not surprisingly, officials said that the CBI nations would probably qualify for parity more quickly since during their years of trading with the U.S. they have developed the bureaucracy to meet this nation’s visa and Customs requirements. Those nations only need to prove that they have the proper Customs enforcement procedures in place to comply with the new system.
The African nations must demonstrate that they have a visa system in place and certify they have enforcement procedures in place to regulate Customs operations, including the prevention of transshipping.
U.S. trade officials said Monday the government has dispatched Customs and trade advisors to Africa nations to assist those nations with certification, but could not estimate when the countries will be eligible to receive the trade benefits.
In addition, trade officials said that, due to allegations of workers’ rights violations brought by U.S. labor unions and watchdog groups, the U.S. will review Guatemala’s compliance with worker rights standards and will decide by April whether to continue or revoke the benefit. The U.S. also will monitor worker standards compliance in El Salvador, Honduras and Nicaragua.
Significantly to importers, trade officials also said that the U.S. will not recognize any quota appropriation plans worked out among the CBI nations for the 250 million square-meters-equivalent of knitted fabric that is eligible for parity. An annual sub-Sahara African quota for export of apparel made with non-U.S. textiles will also be filled on a first-come, first-serve basis.
American importers had argued for recognition of voluntary quota appropriation plans, saying this will better help them plan sourcing programs.
Julia Hughes, the U.S. Association of Importers of Textiles and Apparel’s Washington vice president, said that among the African nations, South Africa, Mauritius, Lesotho, Kenya and Madagascar likely would be the first to receive the new U.S. trade benefits, since they have existing visa systems.
The law granting enhanced trade benefits for the CBI and sub-Saharan Africa technically took effect Sunday. However, parity is expected to officially be granted Thursday, when the U.S. Trade Representative’s designation of the eligible nations is to be published in the Federal Register, retroactive to Monday
These regulations are effective on an interim basis and subject to a 60-day public comment period. Final regulations are expected to be issued in the spring.