NCC Commends Textile Safeguard Proceedings’ Initiation

MEMPHIS – The Committee for the Implementation of Textile Agreements (CITA) announced that the U.S. government will self-initiate textile safeguard proceedings against China in six product categories to determine whether they are contributing to U.S. market disruption.

“This is certainly good news,” said National Cotton Council Chairman Woods Eastland. “It demonstrates the government’s commitment not only to improve its monitoring of textile imports, as was announced earlier, but to take responsible action based on that timely data to curb market disruption when imports are excessive.”

Self-initiation of textile safeguards is authorized by terms of China’s World Trade Organization (WTO) accession agreement and expedites their implementation, more so than the process through which the industry submits petitions. Industry observers estimate that a final decision on the self-initiated petitions could be reached within five weeks. Provided the petitions are approved, a request for consultations with the Chinese would be made in an effort to reach agreement on the rate of imports into the U.S. market. If agreement cannot be reached, the United States is authorized unilaterally to limit import growth from China to 7.5 percent above the shipment rate during the first 12 months of the most recent 14 months preceding the request for consultations.

The six product categories cover three major types of cotton apparel:

• Cotton Knit Shirts and Blouses (categories 338 & 339)
• Cotton Trousers (categories 347 & 348)
• Cotton and Manmade Fiber Underwear (categories 352 & 652)

According to the U.S. government’s early monitoring data, knit shirt imports were up 1,258 percent during the first quarter of 2005 compared with the same period in 2004; for trousers the increase was 1,521 percent; and for underwear, 308 percent.

CITA is expected to publish a Federal Register notice shortly that will provide for a 30-day comment period, after which the agency has up to 60 days to render a final decision. If a decision cannot be reached within 60 days, CITA can extend the period but it must announce when the decision will be made.

NCC President/CEO, Mark Lange joined Chairman Eastland in commending the Administration’s action.

“We commend the Administration for this decisive action,” Lange said. “China has demonstrated in a number of trade categories its capability to dominate the U.S. market in a very short period of time. Self-initiation of textile safeguards is the only way that market disruption can be addressed timely and effectively. A single country’s domination of the U.S. market can damage the interests of the U.S. cotton industry, undermine regional trading arrangements and disrupt established marketing relationships with many less developed trading partners.”