Download - SCLC/ECC Spring 2007 Meeting International Trade Update Stephen Lamar Exec. Vice President
© Copyright AAFA. All rights reserved. 2007
SCLC/ECC Spring 2007 Meeting
International Trade Update
Stephen LamarExec. Vice PresidentAmerican Apparel & Footwear Association
© Copyright AAFA. All rights reserved. 2007
Elections
• Elections were NOT about Trade– General dissatisfaction on economy (incl. trade)– Trade dominant in several elections
• But Trade very much affected by Elections– New Congress MUCH more protectionist
• Freshmen Dems• GOP no longer whipping from leadership
– Trade not a priority– Pro Trade Democrats (New Dem, Blue Dog) – Chairmen Rangel and Baucus will be key
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How did we fare in 2006?
Two FTAs – Oman and Bahrain Staggered CAFTA-DR Implementation Trade Preference Programs
Haiti AGOA Andean GSP
Vietnam WTO Accession Misc. Tariff Bills Port Security No Schumer/Graham Burma Sanctions Renewal (3-year)
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Trade Agenda for 2007• Trade/Labor
– Pending FTAs • Peru• Colombia• Korea • Panama
– Trade Promotion Authority (TPA)
• China/Enforcement• Preference Programs
– Andean– LDC– GSP– CBTPA
• Doha Round
• TAA
• CAFTA-DR Implementation
• Vietnam Monitoring
• Preference Program Implementation
• Affordable Footwear Initiative
• Pakistan ROZ
• Annual Burma Sanctions Renewal
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Trade/Labor• Integral part of a Democrat trade agenda
– A New Trade Policy For America
• Three key labor concepts:– Internationally recognized labor rights
– No derogation
– Equally enforceable
• Hidden agenda– Will big labor really support trade?
– Big issues over whether this changes US labor laws
– New Anti-Sweatshop push?
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• Israel• NAFTA• Jordan• Chile• Singapore• Australia• Morocco
Current and Future U.S. Free Trade Agreements
• CAFTA-DR*
• Bahrain• Oman• Peru• Colombia• Panama
• South Korea• Malaysia• FTAA• ASEAN• Middle East
In force Under negotiation Stalled/DowngradedPending Regional Initiatives Potential
• Ecuador• SACU• UAE• Thailand• Japan
*El Salvador, Honduras, Nicaragua, Guatemala, and DR only.
Note: Peru, Colombia and Ecuador may be merged.
Note: Oman approved by Congress but not yet entered into force.
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FTA Issues• Peru and Colombia
– Labor rights concerns– Environmental concerns in Peru– Human Rights concerns in Colombia– Andean expiration
• Panama– Labor rights– Canal project
• South Korea– Big agreement; huge priority– Controversy
• Beef• Autos
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Doha Round• Launched Nov 2002
– Development agenda
• Faltered July 2006• Key issues
– Agricultural issues• Subsidies• Market Access
– Developing countries
– NAMA• Textile mischief
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Trade Promotion Authority
• Ability of President to negotiate trade agreements– Congressional power of attorney
• Up or Down Vote
• Consultation
• Expires June 30, 2007
• No more FTAs or Doha Round until renewed.
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CAFTA-DR Status and Issues
• El Salvador, Honduras, Nicaragua, DR, & Guatemala Have Implemented
• Costa Rica Joining 1st Quarter 2008?• Cumulation Deal• Pocketing Deal• DR Trousers• Sock Safeguard?• Nicaragua TPL• Retroactivity• Regulations Published
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U.S. Apparel Imports from DR-CAFTA Region
Actual U.S. Imports(In Billions of Square Meter Equivalent - SMEs)
2.5
3.0
3.5
4.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Source: OTEXA, U.S. Commerce Department.Source: OTEXA, U.S. Commerce Department.
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CAFTA-DR: Positive Signs
• Investments Up
• Nicaragua Apparel Imports Up
• CAFTA Apparel Import Decline Flattening
• US Yarn Exports Up
• Individual Product Growth– Dresses 40 percent– PJs 167 percent
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What to Do About China?- Huge budget deficit- Vocal and active “blame China” crowd- China Concerns:
- Labor/human rights- IPR Issues (WTO)- Currency- Subsidies (WTO)
-Politically popular to use trade remedies/safeguards- CVD Issues
- Expect China legislation- Wrapped up in “enforcement” debate
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A few words on Vietnam
• WTO Accession – January 11, 2007– Quota free on January 11, 2007
• Vietnam PNTR Approved• Anti Subsidy Safeguard
– Expires January 10, 2008 (July 10, 2009)• Dole/Graham commitment
– Monitoring– Review every 6 months– Earliest liability for AD duties – mid-August 2006– Expires January 20, 2009– Electoral Mischief?– Precedent for China?
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For the rest of the Bush Administration…
• June 30, 2007 – Expiration of TPA• June 30, 2007 – Expiration of ATPDEA• December 31, 2007 – Expiration of TAA
• January 10, 2008 – Expiration of Vietnam safeguard• September 30, 2008 – Expiration of CBTPA• December 31, 2008 – Expiration of China agreement• December 31, 2008 – Expiration of GSP
• January 20, 2009 – Expiration of Vietnam monitoring
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Final thought
Source of duties collected by US Treasury
54%
46%
All other goods
Textile, Apparel, andFootwear
© Copyright AAFA. All rights reserved. 2007
Final thought
Source of U.S. imports
94%
6%
All other goods
Textile, Apparel, andFootwear
© Copyright AAFA. All rights reserved. 2007
American Apparel and Footwear Association
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Arlington, VA 22209
703-797-9041
www.apparelandfootwear.org
Thank You