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NTA Comments On WTO Draft Proposal

The World Trade Organization’s (WTO’s ) ministerial conference held last month in Hong Kong concluded with the release of a Draft Ministerial Programme that has met with “guarded optimism” from the Boston-based National Textile Association (NTA).

Textile/apparel-related provisions in the draft include an agreement to explore textile sectoral negotiations, establishment by developed countries of duty-free access to 97 percent of all goods from least-developed countries, and calculations for tariff reductions under a “Swiss Formula” that may use different factors for developed and developing countries.

NTA President Karl Spilhaus said the pursuit of sectoral initiatives provides a building block that may help establish truly open markets for US textiles in other countries.
Spilhaus said the inclusion of textiles in the duty-free provision may compromise benefits realized by US trading partners in the Caribbean Basin and Central America under regional duty-free agreements. He challenged the status of Bangladesh and Cambodia as “least developed” in the apparel sector, as their combined textile and apparel exports to the United States totaled $3.4 billion in the first 10 months of 2005.

However, NTA notes, the 3-percent exclusion in the duty-free provision may allow the United States to exclude the majority of the most sensitive textile and apparel products from duty-free consideration.

NTA claims using the Swiss Formula to calculate tariff reductions handicaps the United States because already low US tariffs would be reduced further, while developing countries could retain higher tariffs.

“A textile sectoral offers the best likelihood of getting foreign market access for our American textiles,” Spilhaus concluded. “Our US industry is modern, efficient and innovative. Give us access to foreign markets and we can compete globally.”

January/February 2006