WASHINGTON — Importers have created a wish list of apparel categories they would like U.S. trade negotiators to exclude from quota limits in a potential bilateral textile and apparel agreement with Vietnam.

This story first appeared in the June 7, 2002 issue of WWD. Subscribe Today.

Peter McGrath, chairman of the U.S. Association of Importers of Textiles & Apparel and president of purchasing at J.C. Penney Co., said in an interview Thursday that he is “lobbying hard” to have cotton knit and woven tops, cotton trousers and cotton sweaters excluded from quota limits when a bilateral trade pact is negotiated.

McGrath presented the list to Jon M. Huntsman, Deputy U.S. Trade Representative, and David Spooner, special textile negotiator, on Wednesday. He said consumers are paying more for products because of “quota charges hidden in the price of the goods.”

McGrath said importers would ideally like to give Vietnam a “reasonable” period of time to develop capacity in apparel and textiles before quotas are imposed. Penney’s has made a “firm commitment” to import from Vietnam, but executives are more cautious about expanding until they know how much quota capacity the U.S. plans to allow for each apparel category, McGrath said.

U.S. trade officials claim they have not begun consultations with Vietnam, though they are watching the situation closely.

Although it has only been six months since Vietnam was granted normal trade relations status, imports of apparel and textiles surged in the first quarter of the year by 144.8 percent to 19.9 million square meters equivalent, valued at $38 million, according to the Commerce Department. Despite that surge, Vietnam represents only 0.13 percent of the apparel and textile import market in the U.S., and it is 44th in the ranking of suppliers of apparel and textiles to the U.S.

The Committee for the Implementation of Textiles and Apparel does not typically exclude categories initially when it reviews trade flows to make a determination on quotas before the start of negotiations. Officials consider a variety of factors when it comes to imposing quotas, such as import surges, sensitivity of the category and advice from industry groups, said Donald Foote, director of the agreements division at Commerce’s Office of Textiles and Apparel.

Charles Bremer, vice president of international trade at the American Textile Manufacturers Institute, called two of the three apparel categories importers wish to exclude the “usual suspects” with the largest volume. When the U.S. negotiates with new suppliers, it seeks to control the categories the country is already shipping, as well as the categories with the greatest potential to increase rapidly, Bremer said.

“It’s preposterous,” said Bremer. “You cannot have an agreement that doesn’t cover the important and large volume categories.”

However, Julia Hughes, vice president of international trade at USA-ITA, disputed that. She pointed to Cambodia, which does not have quotas on nightwear even though it is the number-one supplier of nightwear in the world.

“The quota system has no absolutes,” said Hughes. “Any bilaterally negotiated agreement is likely to look different than any other.”

For the year ending March 31, the U.S. imported 206,000 dozen men’s and women’s cotton trousers from Vietnam, valued at $7.25 million and representing 0.16 percent of the U.S. apparel and textile import market, according to Foote. The trade was up 7 percent year-over-year. The U.S. imported 311,000 dozen men’s and boys’ woven cotton shirts, with a value of $9.2 million, but that was down by 36 percent from the year-ago period.

Vietnam imports such a small amount of cotton sweaters, the category doesn’t register on Commerce’s radar, Foote said. Cotton trousers represent a little less than 10 percent of Vietnam’s exports to the U.S. while cotton woven tops represent 15 to 20 percent, according to Foote.

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