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US: Proposes textile and apparel boost for LDCs

Published date:
Thursday, 15 December 2011

As the eighth ministerial conference of the World Trade Organization (WTO) gets underway in Geneva today (15 December), the US has unveiled a number of new initiatives to help the textile and apparel industries in least-developed countries (LDCs) benefit more fully from global trade.

Among measures unveiled to coincide with the three-day event in Switzerland are plans to enact legislation to extend the African Growth and Opportunity Act's (AGOA) "third country fabric" provision to 2015, and offer duty-free-quota-free treatment for imports of upland cotton fibre from LDCs. The US is also seeking to provide extra help for countries who want to make maximum use of its existing trade preference programmes.

However, Trade Representative Ron Kirk admits the moves will still need Congressional support before they can be put into action.

"For decades, the United States has been a strong partner to least-developed countries," Ambassador Kirk said. "We want to see these partners have a greater stake in global trade and overcome constraints inhibiting faster progress."

On improving market access for upland cotton, the US says it plans to launch a review process to consider adding upland cotton fibre to the list of products eligible for duty-free treatment for LDCs through GSP.

It also intends to seek Congressional action to provide quota-free access for LDCs on all upland cotton fibre tariff lines.

"These steps, combined with current historically low US subsidies for domestic cotton production, will contribute measurably to the viability of export-oriented cotton production in West African countries and other LDCs," a statement said.

There will also be a follow-on to efforts to build the capacity and efficiency of the cotton sectors in the C-4 countries (Benin, Burkina Faso, Chad, Mali) through initiatives like USAID's West African Cotton Improvement Program.

This new cotton assistance scheme for these countries would be introduced when the existing programme expires in April 2012 - with the US expecting to provide up to $16m over four years.

And a new USAID programme is being launched to help LDCs make the most of trade preference measures such as the Generalized System of Preferences (GSP).

Least-developed countries who are also WTO members include apparel producing nations like Bangladesh, Cambodia, Haiti, Lesotho, Madagascar, as well as cotton producers Benin and Burkina Faso.

A WTO note says that issues on the agenda this week include a stronger framework to facilitate LDC accessions to the WTO, more time for LDCs to protect intellectual property rights, and a waiver to let members grant preferential treatment to services of LDCs.

The US announcement may be an effort to counter any attempt to secure other LDC-specific concessions at the WTO meeting in Geneva, says Sandler & Travis Trade Advisory Services Inc, a consultancy firm that specialises in international trade law issues.

"Earlier this year WTO members, having realised that they would not be able to conclude a comprehensive Doha Round agreement by the end of December, proposed instead to work out a narrower deal focusing on issues of importance to LDCs such as duty-free/quota-free treatment, simpler rules of origin, a waiver from implementing a to-be-negotiated agreement on services, and "a step forward" on developed country support for cotton production," it said in a briefing note.

"However, due to what director-general Pascal Lamy called "paralysis in the negotiating function of the WTO," it soon became clear that this effort too would not see a successful conclusion. There have been reports that supporters of an LDC-friendly package could try make another effort to push it forward at the upcoming ministerial."

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