US Textile Bodies Suggest Actions to Tackle Trade Deficit

Outlining causes of the $95 billion US trade deficit in textiles and apparel, four US textile trade associations – the National Council of Textile Organizations (NCTO), American Fiber Manufacturers Association (AFMA), Narrow Fabrics Institute (NFI), and United States Industrial Fabrics Institute (USIFI) – have suggested remedial actions to tackle the same.

In their joint comments submitted to the US department of commerce, the coalition of domestic textile manufacturers have recommended six specific actions to tackle the US trade deficit and spur growth in US textile and apparel jobs and output. The recommendations are elimination of unnecessary exceptions in free trade agreements (FTAs), expansion and improving ‘Buy American’ programmes, prioritising customs enforcement, tackling currency manipulation, enacting comprehensive tax reform, and addressing regulatory burdens.

“The US textile industry strongly supports the (Trump) Administration’s desire to investigate the causes of our nation’s trade deficit and respectfully requests that the Administration take steps as soon as feasible to address the root issues associated with this persistent and severely damaging problem,” the associations said in their joint comments.

In addition, NCTO’s Upholstery Fabrics Committee (UFC) has submitted a separate statement detailing the reasons for the US trade deficit in upholstery fabrics, focusing on the imbalance with China in particular. The UFC recommended that the US government should self-initiate countervailing duty and dumping procedures against Chinese upholstery fabrics. “Doing so would provide a mechanism to assess appropriate penalty tariffs on Chinese imports of woven upholstery fabrics in roll form, in cut-and-sewn kits, and in upholstered furniture,” it noted.

Cut-and-sewn kits are comprised of upholstery fabrics that are cut, sewn and attached to furniture frames and filled with foam. Since they enter the US duty free, they are a huge issue and represented an estimated $829 million of Chinese exports to the US in 2016. “Addressing imported Chinese upholstery fabrics and cut-and-sewn kits would encourage increased imports of finished upholstered furniture, so the downstream finished product from China should be covered as well,” UFC said in its statement.

Praising President Trump for ordering review on causes of significant US trade deficits, NCTO president and CEO Auggie Tantillo said, “A trade deficit study like this should have been initiated years ago.”

“If America is to reverse its trade-related red ink and create more jobs, policymakers must have a better understanding of the policies and economic factors responsible for driving production offshore,” he added.