WASHINGTON — The Senate passed a bill last week that is intended to help U.S. retailers, importers and textile producers get back on track to do business in Central America.
The changes to the Central American Free Trade Agreement were in a pension bill that previously passed the House and now will be sent to President Bush for his signature.
Congress has now fulfilled commitments that Republican leaders and Bush administration officials made last year to House members from textile states to get them to vote in favor of the trade accord, which passed by two votes.
“The fact that the [CAFTA] fixes weren’t in place has been felt” by U.S. textile producers, said Missy Branson, senior vice president of the National Council of Textile Organizations. “Once you lose market share, it is always hard to get it back. Hopefully, with these fixes, our manufacturers will be able to stabilize production and … look at some growth opportunities.”
The bill gives the President limited authority to change the rules of origin for pocketing and lining to U.S. or regional origin only. As the trade law now stands, apparel manufacturers in the CAFTA region can use Asian pocketing and lining fabrics, which the domestic textile industry has argued severely hurts U.S. pocketing and lining producers.
The bill allows retailers and apparel importers that produce apparel in Central America to apply for retroactive refunds on unintended duties they have been paying due to the staggered implementation of the accord.
“Unquestionably, people pulled their business out of the region because CAFTA is not fully implemented or because of confusion,” said Stephen Lamar, senior vice president of the American Apparel & Footwear Association. “We’re very pleased the Senate passed it so quickly and we want the administration to very expeditiously put out the regulations on co-production refunds.”