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Retailers Voice Strong Support For Central American Pact

James A. Morrissey, Washington Correspondent

Claiming that the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) will help US and regional textile and apparel manufacturers adjust to the new competitive environment of the post-quota world, the head of the National Retail Federation (NRF) is urging the US Trade Representative and Congress to move swiftly and approve the agreement. Under procedures for trade agreements, the USTR must submit specific language implementing the agreement that must be voted up or down and cannot be amended by Congress. The Senate Finance Committee is expected to meet June 14 to work out details of implementing legislation, and the House Ways and Means Committee is expected to do the same shortly thereafter. Tracy Mullin, president of the National Retail Federation, said the Central American agreement will help reduce prices for US consumers and create opportunities for US retailers to open stores in the Dominican Republic and Central America. She said it also will help build partnerships between US and regional textile and apparel manufacturers.She said the pact would help eliminate some problems retailers see with the strict textile rules of origin now in effect in much of the area. An NRF statement noted that under current trade law, apparel from the region can qualify for duty-free treatment to the United States only if it is made of US fabric woven from US yarn. DR-CAFTA would expand duty-free treatment to cover a wider range of products and would allow those products to be made of fabric produced in the region along with fabric from Canada and Mexico.

June 2005