Congress Defers Trade Bill Action

An omnibus trade bill strongly
opposed by US textile manufacturers was pulled from the House of Representatives calendar last week
as Congress took a recess until after the November elections. It is uncertain at this time if the
bill will be offered again when Congress returns for a brief session November 13.

The bill, introduced by Rep. Bill Thomas, R-Calif., chairman of the House Ways and Means
Committee, covered a number of trade issues affecting textile trade. It would extend until 2008
special treatment of textile and apparel imports from sub-Saharan African nations; it would grant a
liberal tariff preference level (TPL) to imports from Haiti, using a value-added approach — which
textile manufacturers contend is unenforceable and would give a tax credit to US companies
investing in facilities in sub-Saharan Africa.

Textile-state members of the House played a key role in getting the bill removed from the
calendar, as the procedure for considering it would have required a two-thirds majority vote. In
view of the opposition by textile state members, the leadership did not believe it had sufficient
votes to win passage.

Cass Johnson, president of the Washington-based National Council of Textile Organizations,
whose members are strongly opposed to the bill, says the TPLs will benefit China at the expense of
the countries that have preferential trade agreements with the United States.

October 3, 2006