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USA:Hopes on CAFTA soar as Bush begins wooing textile makers |
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2005-2-16
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President Bush has hit the road to convince US textile makers accept trade agreement CAFTA with Central American nations in face of relenting opposition.
For over a year now, the Cafta legislation has been stalled with the legislation falling short on majority by 40 votes in the House of Representatives, opponents say.
The U.S. Trade Representative''s office two weeks ago also held a closed-door meeting with textile executives and lobbyists to try to make the case for Cafta. External analysts have alerted the domestic textile industry to future deals by the administration if it fails to sign on and support Cafta.
US exports would go up by $2.7 billion, and also roll in more such agreements in the World Trade Organization and across the world, including a separate deal being negotiated with Andean nations.
Ending of global textile and apparel quotas this year, have prompted textile executives fear 600,000 job losses in the coming years as China, India and other low-cost producing nations would swamp US and global markets.
As a panacea for averting this collapse of domestic US apparel and textile industry, Cafta is the best solution argues the U.S. trade office. It will help US textile producers remain competitive in the new free trade era.
In 2004, over one-fifth of U.S. fabric and yarn exports, $2.6 billion or in its excess in value terms, went to the Cafta member countries like Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua.
“We are engaging with the textile industry, making the case that Cafta is a strong agreement and vital to the industry''s future,'''' said Neena Moorjani, a spokeswoman for U.S. Trade Representative Robert Zoellick.
Supporters of the trade deal are awaiting the legislation in all earnestness.
Says Keith Crisco, a supporter of the trade deal and the president of Asheboro, North Carolina-based Asheboro Elastics Corp., which exports to Central American sewing plants “I''m not going to tell you it is a majority yet, but I''m less of a minority than I was a year ago.''''
Georgia-based Buhler Quality Yarns Corp. Chief Executive Werner Bieri expressed disappointment in the Central American Free Trade Agreement when it was first unveiled in December, 2003, said in an interview last week: ``Business is moving out every month that we don''t have a Cafta.''''
Bush has to muster full support from textile owners, along with the votes of Republican lawmakers in textile- producing states, to see the Central American deal through Congress. Democrats and sugar producing interests have stalled completion of the agreement, and eight of the 11 Republican lawmakers from textile-producing North Carolina and South Carolina have pledged to block it.
A vote is expected within three months.
Meanwhile, opponents of the deal, particularly textile executives who say Cafta would open the door for duty-free imports of Chinese fabrics and give Mexican textiles an advantage over those from the U.S. They are waiting for new pledges from the U.S. government, a request the Bush administration has so far refused to grant.
Executives such as Bieri envision selling more to factories in Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua. ``A quarter of all U.S. textile exports goes to these countries, and so if you don''t have Cafta a big chunk of their sales could go away,'''' said Ed Gresser, a trade analyst at the Progressive Policy Institute, a pro-trade research institute affiliated with the Democratic Party.
The Bush administration is helping arrange a visit of ambassadors from the Cafta countries to Charlotte and Raleigh, North Carolina, this week. They plan to use the visit to try to convince textile executives that Cafta is the best way to compete with China by creating an integrated regional market, where American-made fabric is sewn into clothes in those low-wage nations.
``If the textile caucus is always voting to the person against trade agreements, is there a reason to keep negotiating provisions to get the support of these guys?'''' said Steven Lamar, a lobbyist for apparel makers such as Jockey International Inc. and Haggar Corp. and chairman of the U.S. trade office''s textile advisory group.
The broadest industry group, the National Coalition of Textile Organizations, avoided taking a position on the agreement because its membership is divided.
The textile groups are looking for pledges that the U.S. will use customs procedures to ensure that no fabric from China gets added to fabric exports from Mexico, or come up with other pledges that could offset negative effects of the agreement.
``How do you either counter the adverse effects or reduce them?'''' said Cass Johnson, executive director of the National Coalition of Textile Organizations. ``It''s time for creativity.''''
At least 300 textile plants have been shuttered and more than 800,000 workers have lost their jobs in the past decade, unable to compete with Chinese competitors that churned out fabric at a fraction of the cost.
Lamar best summed it up saying, “Cafta is the best chance for the U.S. textile industry to survive.” |
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