NCC Applauds Much-Needed China Textile Safeguard Decision

The National Cotton Council said approval of the textile/fiber coalition’s China safeguard petitions on knit fabric, brassieres and dressing gowns is a significant step toward stabilizing the U.S. textile, apparel and cotton sectors.

November 18, 2003
Contact: Marjory Walker
(901) 274-9030

WASHINGTON, DC – The National Cotton Council said approval of the textile/fiber coalition’s China safeguard petitions on knit fabric, brassieres and dressing gowns acknowledges the damage that has been done to the U.S. cotton industry by surges in Chinese imports. The Memphis-based organization said that action sends an important message from the Administration that trade agreements will be enforced.

The U.S. Commerce Department announced that the Committee for the Implementation of Textile Agreements (CITA) approved the petitions Monday night in accordance with the procedures established under the China World Trade Organization (WTO) accession agreement. The approval triggers a consultation process with the Chinese to limit the growth of imports to the United States in these categories. If no agreement on limiting imports can be reached, the United States may limit the level of shipments from China to a level no lower than 7.5 percent above the amount entered during the first 12 months of the most recent 14 months preceding the request for consultations.

The NCC joined with other fiber and textile organizations to encourage implementation of the China safeguards because cotton products on which quotas have been removed are among the fastest growing import categories. Of the 29 categories for which quotas were removed at the end of 2001, eight were cotton-containing products. During the first 12 months following the lifting of quotas, China’s exports of those eight product categories into the U.S. increased an average of 640 percent, while the average price was slashed 71 percent.

NCC Chairman Bobby Greene expressed the U.S. cotton industry’s appreciation for yesterday’s decision to Commerce Department Under Secretary for International Trade Administration Grant Aldonas during a meeting with him in Miami.

“This safeguard action is intended to get China to fully comply with its WTO obligations,” the Alabama cotton ginner said. “China has flooded the U.S. market with cotton textiles and been unwilling to implement regulations that provide consistent, predictable and transparent market access for U.S. agricultural products, including cotton.”

NCC Vice President Stephen Felker, CEO of Avondale Mills in Georgia, commended CITA for this decision – one he says will greatly assist the U.S. textile sector. “Jobs are at risk because the level of Chinese imports is excessive, disruptive and clearly in violation of the levels permitted in China’s WTO agreement,” Felker said.

Felker said the task is not over as textile workers will face substantial risk in January 2005 when all textile quotas are lifted. “This action, though, will set the stage for similar action then by the United States if necessary,” he noted.

In October, 139 Representatives and 26 Senators signed letters - and a number of Senators and Representatives sent separate letters - urging the Administration to invoke the special textile China safeguard provision included in China’s WTO accession agreement.

“These petitions would never have been approved without the help of our friends on Capitol Hill,” NCC Consultant Gaylon Booker said. “The coalition would especially like to thank U.S. Representatives Howard Coble, John Spratt, Virgil Goode and Bill Pascrell, U.S. Senators Lindsey Graham and Ernest F. “Fritz” Hollings, and all the Members of Congress who sent letters to President Bush and the Administration urging implementation of the China safeguard. This strong, bipartisan coalition really helped push the safeguard petitions over the goal line.”

There are about 730,000 Americans working in textile and apparel manufacturing and another 250,000 Americans working in the textile fiber complex, including cotton, wool and man-made fiber production.

In textile and apparel categories no longer under quota, China had nine percent U.S. market share in 2001, compared to 53 percent U.S. market share as of July 2003. The U.S. trade deficit in textiles and apparel totaled $60.6 billion in 2002. The trade deficit with China was $10.8 billion.