US textile industry becoming more protectionist — GTEB

The US textile industry is becoming more protectionist to the detriment of the local industry.

As a result, the country may not be able to get additional quotas or flexibilities from the US government.

This was the warning made by Felicitas R. Agoncillo-Reyes, executive director of the Garments & Textile Export Board (GTEB), to Trade and Industry Secretary Manuel Roxas II following a study on the US textile industry.

According to Reyes, the US textile industry is concerned about the rise in textile imports from Asia, specifically from six countries that include the Philippines, India, Indonesia, Pakistan, Sri Lanka and Taiwan.

Imports from six Asian countries alone, the report said, rose by 80 percent in just four years as Asian currencies weakened by an average of 40 percent.

The US textile industry cited the fact that the collapse of the currencies of almost all the major textile exporting Asian countries has caused a "shock wave of artificially low-priced textile and apparel products."

As a result, the report said, prices for US textile products have plummeted since 1997. It also said that US textile profits have "evaporated" and, last year, turned sharply negative.

Over the last 12 months, the textile crisis has intensified as Asian currencies have continued to fall, according to the report.

The US textile industry further reported that over 100 textile plants in the US have been closed and 60,000 textile workers representing more than 10 percent of the industry workforce have lost their jobs.

The US textile industry is suffering its worst downturn in 50 years.

The US textile industry is urging the US government to take a number of actions that include a crackdown on Asian smuggling along the US-Mexico border and Chinese transshipments through Asia; self-initiation of emergency surge controls; opening close export markets in Asia; a commitment not to reduce textile and apparel tariffs in the next Word Trade Organization (WTO) trade round; Federal loan guarantees and expanding tax loss carryback provisions to 10 years.

Reyes expressed the view that not all of the requests of the US textile industry would be granted.

However, their complaints, Reyes acknowledged, has gained considerable attention and would be difficult for the US administration and members of the US Congress to ignore.

Therefore, she warned, "the strong lobby of the US domestic industry has thus made it difficult for countries like the Philippines to gain increased market access to the US prior to the quota phaseout in 2005."