WASHINGTON — The chairmen and ranking Republicans of the two key trade committees in the House and Senate introduced legislation Wednesday in both chambers that would significantly increase the volume of apparel made in Haiti that can be shipped to the U.S. duty free.
This story first appeared in the April 29, 2010 issue of WWD. Subscribe Today.
Lawmakers have been clamoring to help the industry in Haiti following the devastating earthquake in January and U.S. retailers, apparel importers and the Haitian apparel industry have been lobbying the Obama administration and Congress for more duty breaks.
Before the earthquake, 28 apparel and textile firms, employing 28,000 workers, were operating in Haiti, according to the Association of Industries in Haiti. The apparel and textile industry accounted for two-thirds of exports and almost 10 percent of gross domestic product. Apparel and textile imports from Haiti increased 24.5 percent to $513.3 million in 2009, according to the U.S. Department of Commerce.
“By improving access to the U.S. market for Haitian textile and apparel products, our bill will provide the long-term assistance Haiti needs to get back on its feet,” said Sen. Max Baucus, chairman of the Senate Finance Committee, who cosponsored the bill with Sen. Chuck Grassley and Reps. Sander Levin, Dave Camp and Charles Rangel.
The bipartisan, bicameral legislation would increase the allowances of third-country fabric of both knit and woven apparel to 200 million square meter equivalents from 70 million SMEs in each category. The bill places sub-limits of 85 million SMEs on the duty free benefits for certain knit apparel products and limits of 75 million SMEs for certain woven apparel products, which were not identified in press materials.
In addition, the bill extended the value-added rule until Dec. 20, 2015 that provides for duty free treatment for apparel wholly assembled or knit-to-shape in Haiti with at least 50 percent value from Haiti, the U.S. or countries that have a free trade agreement or participate in preference programs with the U.S. It also extends until 2017 duty free treatment for Haitian apparel with at least 55 percent of value from qualifying countries and, until 2018, duty free treatment for Haitian apparel with at least 60 percent of value from qualifying countries.
Another provision of the bill that allowed companies in Haiti to use one SME of apparel made with third-country fabric for every three SMEs of apparel made with U.S.-made fabric, was liberalized to one SME of apparel with third-country fabric for every two SMEs of apparel with U.S.-made fabric.
The bill would also extend the underlying Caribbean Basin Trade Partnership Act and the Haitian Hemispheric Opportunity through Partnership Encouragement Act (HOPE) through Sept. 30, 2020.