In 2017, the United States Fashion Industry Association (USFIA) will continue our work to find opportunities to eliminate tariffs and open markets, to expand activities with U.S. Customs and Trusted Trader Programs, and to provide resources to help fashion brands, retailers, and importers source in cost-effective, efficient, and ethical ways. We look forward to engaging with the Trump Administration and the 115th Congress on these issues.
Open Markets Through Legislative Initiatives
American families pay unnecessarily high taxes on everything they wear. While the average duty on manufactured products is 2 percent, tariffs on clothing and footwear, including clothing for children and babies, can be as high as 32 percent for clothing and 65 percent for footwear. The elimination of these regressive taxes on American families—and lower prices—would be the best economic stimulus program we have ever seen.
How can we achieve this goal? We recommend starting with the duty reduction/elimination programs that are already in place.
Support Duty Suspension Petitions: USFIA will support our members who file petitions with the International Trade Commission (ITC) to reduce or eliminate duties on products that are not sensitive for the U.S. industry.
Support Initiatives to Expand the Generalized System of Preferences (GSP) to Apparel & Footwear: The current GSP program expires at the end of 2017. USFIA is working with development organizations and other associations to develop an enhanced GSP program. The new program should be based on the principle that all products will be eligible for the benefits.
Support U.S. Jobs
Retail supports 42 million jobs—or 1 in 4 jobs in the United States. And fashion brands and retailers offer high-quality design, product development, logistics, sourcing, and service jobs in the United States, in addition to manufacturing jobs. These jobs are supported by global value chains, and these jobs will be on track to grow if free trade agreements contain rules of origin and market access provisions that will decrease the cost of those fashion products. This would not only help the brands and retailers grow and create more jobs, but also help consumers by providing access to affordable, high-quality apparel.
Improve Supply Chains
Global supply chains are a major concern for the fashion industry. USFIA will continue to work with industry coalitions as well as congressional leadership to improve supply chains. Our goal is to discuss solutions before there are disruptions in the supply chain—such as support for an early negotiation of the next contract by the International Longshore & Warehouse Union (ILWU) and Pacific Maritime Association (PMA). USFIA will work to educate Congress and the Trump Administration about industry efforts to promote transparency in supply chains and to ensure that supply chains promote human dignity and labor rights—while also working to educate the Administration and Congress about the drawbacks of an onerous “one size fits all” approach to these issues.
Support the WTO Trade Facilitation Agreement
The World Trade Organization Trade Facilitation Agreement (TFA) is an opportunity to focus global resources to improve infrastructure and administration of supply chains by developing countries. USFIA is working with the Global Alliance for Trade Facilitation in support of this initiative.
Support and Enhance Sourcing from Developing Countries
In addition to support for the TFA, USFIA members support policies and agreements to encourage sourcing from developing countries. Expansion of trade with the African Growth & Opportunity Act (AGOA) countries is a priority. We also support expanded benefits for Nepal. USFIA will work with USAID and with the new Administration to enhance and promote these programs.
Open Markets Through Trade Agreements
USFIA continues to support the negotiation of trade agreements, with the goal to shift to 21st-century rules and improved market access for apparel and footwear. We recommend that trade negotiations focus on the opportunities created by global value chains instead of focusing predominantly on the source of the yarns to determine which products are eligible for duty-free access. USFIA will engage with the Trump Administration to identify and influence the launch of any new trade talks.
During the Obama Administration, most of the focus was on the Trans-Pacific Partnership (TPP) and the Transatlantic Trade & Investment Partnership (TTIP). USFIA will continue to support trade negotiations that will eliminate all textile, apparel and footwear tariffs, as well as eliminate technical and administrative barriers through regulatory convergence. FTAs and trade preference programs have a positive impact on the fashion industry global value chain, and on American consumers.
Cumulation for Free Trade Agreements
USFIA supports negotiation of cumulation provisions with all free trade agreements, which would allow retailers and brands to move inputs across free trade agreements and improve sourcing opportunities. The link between existing FTAs will support sourcing opportunities with key trading partners and will encourage the development of value chains between FTA partners. There currently are efforts to get support for cumulation between the FTAs with Colombia and Peru. We also support broader efforts to create cumulation for all Western Hemisphere FTAs.
Expand Industry Activities with CBP & Trusted Trader Programs
USFIA strongly supports the private-public partnership between U.S. Customs & Border Protection and the fashion industry. We also applaud the expanding role for the Center for Excellence & Expertise (CEE) for Apparel, Footwear and Textiles. The support for Trusted Trader programs and for CBP and industry to work together are key activities for USFIA.
There remain very important issues for the trade going forward, especially the full implementation of ACE and the requirements on the trade when entries involve Partner Government Agencies. In addition, USFIA and our members see several additional major issues in 2017. Some of the major issues are:
- Implementation of the forced labor statute
- Increased emphasis on enforcement
- False Claims Act expansion
- Increased scrutiny of First Sale
- Duty drawback updates
- Implementation of AD/CVD enforcement regulations
- Simplification of the Tariff Schedule
Help Companies Source in Cost-Effective, Efficient, & Ethical Way
Our educational events and publications provide the latest information to companies on how to source in a cost-effective, efficient, and ethical way. In addition to providing this education and training, USFIA will work to enhance the good work our members are already doing by providing information and serving as the link between brands and retailers, manufacturers, governments, NGOs, and other organizations across the value chain committed to human and labor rights and sustainability.
Tell the Story: As part of this initiative, USFIA will soon launch our Social Compliance & Sustainability Committee, bringing together a cross-section of the industry to share best practices and tell the story of how brands and retailers are creating change on key issues including factory safety and compliance, environmental sustainability and stewardship, global worker wellbeing and human rights, elimination of forced and child labor, conflict minerals compliance, and chemical management.