Congressmen Seek Support For Textile Agenda

Leaders of the Congressional Textile
Caucus are circulating a letter to their colleagues seeking support for the textile industry’s
agenda. Their goal is to get enough signatures to put pressure on administration trade officials to
act favorably on key issues.

A letter to US Trade Representative Rob Portman underscores the economic importance of the
industry and expresses concern over what is being reported about the Doha Round of trade
liberalization talks and the accession of Vietnam to the World Trade Organization (WTO). The letter
says: “We believe that unless the US government takes specific steps, these talks will likely cause
large job losses in the US textile and apparel sector. We are committed to working with you to
ensure that the concerns of this industry, which contributes $75 billion through textile production
and $2.7 billion through apparel to our GNP [gross national product], and is the third largest
exporter of textile products in the world, are addressed at this critical juncture.”

The letter calls for sectoral textile negotiations in the Doha Round and “substantially
equivalent” concessions that would ensure fairer and more open opportunities for both the United
States and its trading partners. It expresses concern the current talks are framed in a fashion
that will produce an “uneven outcome.” The letter says sharp cuts in US textile tariffs will “
almost certainly dismantle our various preferential trading programs that are dependent on
zero-duty arrangements.”

With respect to Vietnam, the letter says: “Like China, Vietnam has a large and subsidized
textile sector that utilizes anti-free market principles to under-price producers here in the
United States and elsewhere. Just as with China, the United States must insist on a textile
safeguard system or an extension of the current quotas until these unfair subsidies are removed.”

The congressmen warn “failure to address these concerns will substantially impact our view
of the administration’s legislative trade agenda from this point forward.”

Although a tentative agreement has been reached between the United States and Vietnam,
domestic manufacturers believe they have opportunities to modify any final agreement. They are
seeking congressional support to get the agreement changed before it is finalized on a bilateral
basis, and it will be subject to multilateral negotiations in the WTO. This is likely to remain a
highly contentious issue for some time.

May 23, 2006