Association Sees Progress And Challenges On Trade Front

In its annual business review and
forecast, the Washington-based National Council of Textile Organizations (NCTO) cites some
significant changes and accomplishments on the international trade front, and points to some “
daunting challenges” in the coming year.

The report shows that virtually all of the industry’s economic benchmarks in 2006 were down
from 2005 — except for a small gain in profits — as rising imports continued to take their toll. On
the plus side of the ledger, NCTO reports free trade agreements negotiated during 2006 with Peru,
Colombia and Panama were the tightest ever with regard to textiles and apparel. The report also
says the US government, for the first time in 20 years, has moved aggressively on dumping on behalf
of a specific industry, and adds “in a post-quota world, this represents a new and fresh approach
to addressing the problem of dumped and subsidized apparel imports from countries that refuse to
act responsibly and live by their commitments.”

NCTO Chairman Smyth McKissick of Alice Manufacturing said the industry’s successes during
the past year are the “direct effect of relationships we have built with members of Congress and
the Administration.” He added, “It is only through partnerships with elected officials and public
servants that significant results have been achieved by the industry.” McKissick noted that a
series of “Hill to the Mill’ plant tours and other educational activities showed government
officials “a 21st Century, highly innovative industry that is capable of competing against anyone
in the world as long as the rules of trade are applied equitably and fairly.”

Looking toward 2007, McKissick sees a number of major issues to be confronted, but the
long-term treatment of China and Vietnam remain the industry’s top priorities. “With the expiration
of the China safeguards in 2008, the implementation of a new trade preference program for Haiti and
the push to conclude a Doha Round global trade agreement, our future challenges will be no less
daunting than the ones we have confronted in the past,” he said.

He also cited Chinese currency manipulation as a “major issue” and said NCTO will be working
with the China Currency Coalition, which includes a number of manufacturing industries and labor
representatives, to get a “strong” China currency bill enacted. He added that NCTO is looking
forward to working with the new Democratic-controlled Congress on fair trade proposals that will “
ensure the future viability of the US textile industry.”

January 30, 2007