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Legislation Calls For Expanded Trade To Help Haiti

James A. Morrissey, Washington Correspondent

U.S. textile and apparel manufacturers will play a key role in helping Haiti's recovery from the January earthquake that shattered that nation's economy under legislation that has been introduced in both the House and Senate providing for extended and expanded trade preference programs covering textile and apparel trade. Because the legislation was introduced by the chairmen and ranking members of the House Ways and Means and Senate Finance Committees, it likely will receive quick consideration and enactment.

The legislation, called the Haiti Economic Lift Program (HELP), extends the expiration date for two existing trade preference programs and expands their coverage for duty-free entry of apparel. U.S. importers of apparel have strongly endorsed the legislation, and textile makers will not oppose it, although they have some lingering concerns over the legislation's impact on U.S. jobs.

Ways and Means Committee Chairman Sander Levin, D-Mich., said: "This legislation provides important incentives to expand trade and investment in Haiti, and it does so in a manner respectful of the complementarities of the industries of our two countries. It reflects careful consideration and collaboration with stakeholders here in the United States as well as Haitian industry representatives and provides a way forward that works to the benefit of workers and businesses in both countries."

Sen. Chuck Grassley, R-Iowa, the ranking member of the Senate Finance Committee, also underscored the  need to protect the interests of both nations, saying "the legislation will spur investment and create jobs in Haiti, and at the same time the legislation addresses the concerns that have been expressed by the U.S. textile industry with respect to both domestic and regional production of textiles and apparel."

As the legislation was being developed, U.S. textile lobbyists worked with committee staffers to find a way that would benefit Haiti but not have a negative impact on U.S. textile jobs. As the legislation was being developed, former Presidents George W. Bush and Bill Clinton called for the widest possible liberalization of trade, which made it difficult to oppose some of the proposals that were being made. However, the textile representatives were successful in minimizing the impact on particularly sensitive product categories such as trousers, knit T-shirts, pullovers and sweatshirts. This issue involved the so-called Tariff Preference Levels (TPLs) that permit use of yarn and fabric regardless of the country of origin. TPLs were broadened for certain Haitian knit and woven apparel items  from 70 million square meter equivalents to 200 million. The TPLs on  trousers, T-shirts, pullovers and sweatshirts will remain at the current levels.

The legislation also extends the expiration dates for the Caribbean Basin Trade Partnership Act and the Haitian Hemispheric Opportunity through Partnership Encouragement Act through Sept. 30, 2020.  It also expands the duty-free treatment to products that are wholly assembled or knit-to-shape in Haiti regardless of the origin of the inputs.

Under the legislation, U.S. Customs and Border Protection is directed to verify that goods under TPLs are not being unlawfully transshipped into the United States, and it authorizes the President to reduce the TPLs to account for unlawful apparel shipments.

Calling for quick enactment of the HELP Act, Kevin Burke, CEO, American Apparel & Footwear Association, said: "As the single largest sector of Haiti's  economy, the apparel industry will play a leading role in Haiti's overall recovery. By renewing soon-to-expire trade preference provisions and expanding existing programs, this bill works to ensure that all facets of the U.S. apparel and textile industry have the opportunity to participate in Haiti's short term recovery and long term growth."

May 4, 2010

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