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Wednesday, July 9, 2014

Trans-Pacific Partnership: Textiles & Apparel

The Trans-Pacific Partnership (TPP) is an ambitious, 21st century trade agreement that the United States is negotiating with 11 other countries throughout the Asia-Pacific region (Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam). When complete, TPP will unlock opportunities for American workers, families, businesses, farmers, and ranchers by providing increased access to some of the fastest growing markets in the world.

TPP will provide new market access for Made-in-America goods and services, strong and enforceable labor standards and environmental commitments, groundbreaking new rules on state-owned enterprises, a robust and balanced intellectual property rights framework, and a thriving digital economy. It will also include commitments that will improve the transparency and consistency of the regulatory environment to make it easier for small- and medium-sized businesses to operate across the region. By opening these new markets to American products, TPP  will help ensure that we are not left behind by our competitors in a vital region of the world.

The United States ships more than $1.9 billion in goods to TPP countries every day.  In today’s highly competitive global marketplace, even small increases in a product’s cost due to tariffs or non-tariff barriers can mean the difference between success and failure for a business.  That is why the United States is working to negotiate in TPP comprehensive and preferential access across an expansive duty-free trading region for the industrial goods, food and agriculture products, and textiles, which will allow our exporters to develop and expand their participation in the value chains of the fastest-growing economies in the world.

Below is a small portion of the Summary of U.S. Objectives in regard to the apparel and textile industry.

TEXTILES

U.S. textile and apparel manufacturers sold more than $10 billion worth of products to TPP countries in 2013, an increase of 5.4 percent from the previous year.  Many U.S. yarns, fabrics, and apparel currently face tariffs as high as 20 percent upon entering some TPP countries.  The goal of the TPP negotiations is to remove tariff and non-tariff barriers to textile and apparel exports to enhance the competitiveness of our producers in the Asia-Pacific region.

Specifically, in the TPP we are seeking:
  • Elimination of tariffs on textile and apparel exports to TPP countries;
  • A “yarn forward” rule of origin, which requires that textile and apparel products be made using U.S. or other TPP country yarns and fabrics to qualify for the benefits of the agreement, so as to ensure that non-qualifying textiles and apparel from non-TPP countries do not enjoy the benefits reserved for TPP countries;

  • A carefully crafted “short supply” list, which would allow fabrics, yarns, and fibers that are not commercially available in the United States or other TPP countries to be sourced from non-TPP countries and used in the production of apparel in the TPP region without losing duty preference;

  • Strict enforcement provisions and customs cooperation commitments that will provide for verification of claims of origin or preferential treatment, and denial of preferential treatment or entry for suspect goods if claims cannot be verified; and

  • A textile specific safeguard mechanism that will allow the United States and other TPP countries to re-impose tariffs on certain goods if a surge in imports causes or threatens to cause serious damage to domestic producers.

The above was retrieved from the TPP site July 9, 2014.  Please see there site for updates or revisions http://www.ustr.gov/tpp

Some people are for the TPP proposal and some are against.  Opponents of the deal say that the TPP would roll back the gains of almost every people’s movement, especially those concerned with labor and the environment.  You can read the article at As Trans-Pacific Partnership Falters, Opponents Go After Fence-Sitting Pols

Tokyo and Washington are seeking a two-way trade deal, regarded as a key part of the US-led Trans-Pacific Partnership (TPP) that is the center piece of Washington’s push to increase its Asian presence.  You can read more at the news article from April 2014 at Japan, US Face Off In Crucial Trade Negotiations.

Learn more about issues facing the apparel industry here on Apparel Search.

You can check the government information section or the customs relevant issues to learn more about importing and exporting relevant issues such as NAFTA and other trade agreements.

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