Johnson explained, “This bill upends trade policy that stretches back to the 1980's by singling out one country to get dramatically better benefits than everyone else in the CAFTA, NAFTA, CBTPA and ANDEAN region.”
“These benefits are unilateral, which means that they will come at the expense of the U.S. industry. Under this legislation, Haiti, as well as most African countries, will be able to use Chinese fabric or Chinese yarns for apparel production while every other preference partner must use regionally made yarns and fabrics.”
“This is a benefit that cannot be beat given China's state-owned and subsidized textile sector and its use of currency manipulation. While China wins, regional producers, including the U.S. industry, will be the big losers.”
“The result will be a huge shift of orders out of the CAFTA region. The worst part is that Customs has already told us this rule cannot be enforced. Therefore, Haiti will not even get the benefits that this bill projects because China will send fully assembled goods or nearly fully assembled goods through Haiti.”
“Unfortunately, this is history repeating itself – the Northern Marianas Islands have exactly the same loophole and they have shipped every kind of apparel product to the United States duty free, all of it made from Chinese yarns and fabrics. Every other producer has been shut out and Customs has repeatedly found enormous fraud.”
“Ironically, this bill is being proposed at a time when apparel exports from Haiti are surging (up 20%) while exports from CAFTA are falling (down 13%). In the midst of a very competitive global environment, Haiti is doing extremely well and it is doing so using primarily US yarns and fabrics.”
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National Council of Textile Organizations
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