Fashion Intel & Analysis
Today is the 90th anniversary of the enactment of the Smoot-Hawley Tariff Act. You may remember from history class that this legislation imposed high tariffs in response to President Herbert Hoover’s call to protect declining domestic industries. What you may not know is that American consumers continue to pay higher taxes on clothing and footwear even in 2020.
Over these 90 years, footwear and apparel companies and consumers have paid an incredible $309 billion in tariffs to the U.S. government. They have done so, even though the tariffs do not protect footwear and apparel jobs. Today’s leading footwear and apparel companies have global supply chains that depend on international trade and support U.S. workers. High tariffs negatively impact these American workers, and the U.S. footwear and apparel sectors have urged their removal for decades now.
Join us to urge the President and lawmakers to remember this lasting legacy. The fashion industry -- apparel, accessories, home textiles and footwear -- serve as key examples of why Smoot-Hawley’s idea of high tariffs on U.S. imports has not worked and fails to keep jobs here in the U.S. With the President’s constant rhetoric of more tariffs, we must also remember one of the most unfortunate legacies of Smoot-Hawley: Once a tariff is in place, it is almost impossible to take it away.
Today President Trump signed the Uyghur Human Rights Policy Act of 2020 (S.3744) into law. As you know, the legislation recommends the Administration take a tougher approach towards China and explicitly link the U.S. China policy to the treatment of the Uyghur ethnic minority. The bill also requires several reports on the situation, including a State Department report on human rights violations in Xinjiang Province.
Today U.S. Customs and Border Protection (CBP) issued a Withhold Release Order (WRO) for hair products manufactured by Lop County Meixin Hair Product Co. Ltd. (Meixin) based on "information that reasonably indicated the use of prison labor with additional situations of forced labor including, but not limited to, excessive overtime, withholding of wages and restriction of movement." Lop County Meixin Hair Product Co. Ltd. (Meixin) is based in the Xinjiang region of China. Brenda Smith, the Executive Assistant Commissioner of CBP's Office of Trade, said: "The use of forced labor is not just a serious human rights issue, but also brings about unfair competition in our global supply chains.”
USFIA joined more than 200 companies and industry groups to support Congressional action to renew the Generalized System of Preferences (GSP) program as soon as possible. GSP is scheduled to expire on December 31st. The June 16th letter went to the Congressional trade leadership - Senate Finance Committee Chairman Chuck Grassley (R-IA) & Ranking Member Ron Wyden (D-OR), and House Ways and Means Committee Chairman Richard Neal (D-MA) & Ranking Member Kevin Brady (R-TX). The coalition highlights the economic impact on U.S. companies, especially small businesses, if GSP is not extended before the end of the year. Without the GSP duty-free benefits, U.S. companies will face millions of dollars in new taxes while they are still struggling to recover from the COVID-19 shutdown. If your company is interested to join the campaign to renew GSP, please let us know at This email address is being protected from spambots. You need JavaScript enabled to view it..
Today USFIA submitted a pre-hearing statement to the U.S. International Trade Commission (USITC) on the probable economic impact of a U.S. - Kenya Trade Agreement. As part of the Administration's plan to begin talks with Kenya for a free trade agreement, the ITC will prepare an economic impact review and will also hold a hearing on July 7th. Kenya is the largest supplier of apparel imports from Sub-Saharan Africa. You can read the full statement here. Here is a quote from the conclusion of the statement
Fashion is made possible by global trade. That’s why the United States Fashion Industry Association (USFIA) raises these concerns that the negotiation of a Free Trade Agreement with Kenya must integrate the Rules of Origin and supply chain that has developed during two decades of AGOA benefits. Unlike any previous trade negotiation, the negotiation of this agreement will have a profound impact not only on trade with Kenya, but also on the opportunity to support economic development throughout Sub-Saharan Africa, and set a standard for future Free Trade Agreements that meet the high-standard 21st-century objectives we all support.
