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Washington Outlook Archive

Textile Makers Seek Relief From Illegal Imports

James A. Morrissey, Washington Correspondent

US textile manufacturers, testifying at a special congressional subcommittee hearing dealing with US Customs and Border Protection enforcement of textile imports, called for the government to overhaul its procedures in order to address what they say are illegal import surges that are forcing plant closures and thousands of job losses. Testimony focused mainly on imports under the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR), but it would apply to all preferential free trade agreements.

Describing customs enforcement as "a vital part of the textile industry's ability to compete," Cass Johnson, president of the National Council of Textile Organizations, said, "We have seen a sharp rise in fraud in the Central American area, we have alerted Customs to the problem, and very little is being done to correct it."

Dan Nation, president of Parkdale Mills Inc., the largest sales yarn spinner in the United States, said his company has been forced to close down 19 facilities, and 1,900 employees have been laid off as yarn fraud has increased throughout the CAFTA-DR region. He believes at least half of the plant closures could have been avoided if there had been better Customs enforcement. At a news conference following the hearing, he said, "The cheaters are winning and we are losing."

Harding Stowe, chairman of R.L. Stowe Mills, said his company was forced to close in January because Customs failed to act when Pakistani and Chinese falsely labeled yarn supplies surged throughout the CAFTA-DR area. Stowe said his company had regularly supplied Customs with information pointing out illegal yarns were being used, but Customs did not act.

Testifying at the same hearing, Eric Autor, vice president and international trade counselor for the National Retail Federation, warned members of the committee not to yield to pressure from the textile industry to step up their efforts to tighten enforcement of textiles and apparel imports, saying such actions could lead to "overzealous enforcement," with little or no oversight that will punish legitimate importers.

Autor said one-third of all Customs import specialists already are devoted exclusively to textile and apparel trade, and "forcing the Customs and Border Protection to devote more resources to textiles and apparel trade would have a "critical impact" on cargo security and drug interdictions.

Daniel Baldwin, assistant commissioner of Customs, also defended his agency's commitment to textiles and apparel, saying Customs has increased employment of textile specialists from 264 in 2006 to 329 today.

Richard Crichton, a retired Customs officer with more than 40 years experience in dealing with textile and apparel trade, said importers are using increasingly sophisticated tactics to get around trade preference rules. He outlined a number of steps he believes can be taken to improve the situation, including more funding for specialized training of textile and apparel customs agents in the United States and more training of enforcement agents in foreign countries. He believes there must be better ways for evaluating trade data, including better feedback from field offices to headquarters and a sophisticated electronic tracking system that would lead to rapid response when problems are identified.

The textile industry officials said the industry's support for legislation authorizing CAFTA-DR when it was pending in Congress was contingent on effective Customs enforcement, but that is not happening.

June 23, 2009

Related Files:
Click here to read testimony from Dan Nation, president, Parkdale Mills Inc.
Click here to read testimony from Harding Stowe, chairman of R.L. Stowe Mills
Click here to read testimony from Richard Crichton, retired customs officer
Click here to read a written statement to the hearing record from Cass Johnson, president and CEO, National Council of Textile Organizations