WASHINGTON — The China safeguard petitions are coming, and the government is set to give them a serious look.
Grant Aldonas, undersecretary for international trade at the Commerce Department, attempted to squelch any trace of internal divisiveness within his own agency Friday when he insisted that the U.S. textile industry can file China safeguard petitions based on the threat of market disruption under the current U.S. procedures.
Aldonas said the industry has a right to file threat-based petitions and stressed the administration does not need to issue any new procedures or criteria in order to accept petitions. If the petitions meet the technical criteria, the administration will accept them.
He went to great lengths to clarify the government’s position before taking a trip to China, set to begin today and go through Sept. 18, where he will meet with high-level Chinese commerce and trade officials.
Aldonas said he plans to raise the issue of looming safeguard petitions with the Chinese in an effort to draw them to the table to negotiate a comprehensive quota agreement. He also noted that the Chinese apparel industry is beginning to understand that a voluntary restraint agreement could create a little more certainty in the system.
Commerce is working on a list of criteria that petitioners will have to meet under a threat standard, including providing data on new investment in production in China and proving the Chinese have the ability to shift production into a particular category named in the petition, he added.
“They can file, present their best case and we will take a hard look at it,” said Aldonas. “It boils down to the probative value of the evidence present.”
He also noted that the petitioners do not need to provide evidence of surging imports, which would be difficult to find on categories still under quota. Aldonas clarified that the textile industry can file safeguard petitions on apparel and textile products still under quota, dispelling an argument made by importers and retailers that the textile industry could not file petitions on products under quota.
Aldonas did some damage control in a Friday call after Jim Leonard, deputy assistant secretary of textiles, apparel and consumer goods at Commerce, infuriated textile executives Wednesday when he contradicted claims they had assurances from the government to proceed with petitions based on threat.
“On textiles, there seems to be a back-and-forth on whether or not the administration will accept threat cases or whether threat cases are somehow not viable under the bilateral accession agreement with China,” said Aldonas. “The bilateral agreement gives the industry the right to file threat cases, and the [U.S.’s own] procedures that we have in place apply to threat.”
Three U.S. textile associations said Wednesday they planned to file a wave of safeguard petitions against “dozens” of apparel and textile imports from China before the end of the month.
Leonard, however, cast a doubt on whether the existing procedures allowed for threat cases, and he further noted that the Committee for the Implementation of Textile Agreements, the interagency group overseeing the petitions, might have to either create a whole new set of safeguard procedures or at least amend existing procedures. However, Aldonas took hold of the reins Friday and reaffirmed the textile industry’s right to file threat-based petitions under the current procedures, which he claimed do not have to be amended.
“They [Leonard and others] work for me,” said Aldonas. “At the end of the day, the decision comes through this office. When the issue was raised there was a doubt in some minds, but we have resolved that doubt in the last 24 hours.”
The 147 members of the World Trade Organization on Jan. 1 are to lift quotas on apparel and textile trade. The domestic textile groups claim the move will deal a fatal blow to the remaining 696,500 apparel and textile jobs in the U.S.
“We are pleased that the U.S. Department of Commerce has publicly confirmed the U.S. textile industry’s right to file threat-based special textile China safeguard petitions,” said Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition.
Julia Hughes, vice president of international trade at the U.S. Association of Importers of Textiles & Apparel, said, “This will anger people in the industry, because it is a shift of what was said a year ago. What this means is that the burden will be placed on retailers and importers in terms of additional uncertainty.”