TRALAC - Trade Law Centre

USA: Government Delays Safeguard Decisions

Tuesday, 02 August 2005

Source: Just Style.com

For the third time in the past two weeks, the US government yesterday announced that it was delaying decisions due on safeguard cases filed against surging textile and apparel imports from China – and that it intends to consult with industry and lawmakers about whether to seek a comprehensive textile trade pact with Beijing.

US commerce secretary Carlos M Gutierrez said in a statement that the delay “will allow us time to engage in substantive discussions with our domestic textile and apparel industries and members of Congress on whether there is interest in a broader textile agreement with China.”

He added: “We look forward to working with industry and Congressional leaders to get their views on the best way to ensure a level playing field.”

The US government delayed decisions on cases covering wool trousers, sweaters, brassieres, dressing gowns, knit fabric and other synthetic filament fabric until August 31.

The decisions on synthetic filament fabric and wool were previously delayed from July 18 and July 22, respectively, to July 31.

In other action, the US government accepted for review five additional safeguard cases covering socks, woven blouses, skirts, nightwear and swimwear.

“We are pleased that the US government has accepted additional cases for review,” said Auggie Tantillo, executive director of the American Manufacturers Trade Action Coalition (AMTAC).

“However, the only good excuse for delaying decisions on the products where decisions were due is if the US government is able to negotiate a fair comprehensive textile and apparel agreement with China in short order.

“We look forward to consulting with the US government on the critical issue of reaching an agreement with the Chinese.”

“A fair comprehensive agreement would cover all categories where safeguard petitions have been filed or approved. It should also include any categories where safeguards have not been filed that are disrupted or that are facing imminent disruption,” continued Tantillo.

“A fair deal would limit the growth of Chinese imports to very close to 7.5 per cent and should last through the end of 2008.

“Finally, any fair deal also would include no promises not to extend the safeguard during current the Doha Round of WTO negotiations and fair and tough penalties on Chinese quota limits if companies are caught illegally transshipping,” he concluded.

The decision to investigate a deal with China follows last week’s vote in the US House of Representatives on the US-Central American Free Trade Agreement (CAFTA), where some textile state lawmakers helped provide the margin of victory.

The US has already applied a range of emergency quotas to Chinese textiles this year, amidst worries that a surge in cheap imports will damage its own industry.

In 2005, the volume of US imports of textile and apparel products from China have surged 47 per cent. China now controls more than 30 per cent of the US import market for textiles and apparel.