The Retail Industry Leaders Association (RILA) submitted written testimony to the Subcommittee on Trade of the Committee on Ways and Means, encouraging the U.S. to negotiate an ambitious Trans Pacific Partnership (TPP) agreement that facilitates new trade and investment in all sectors by eliminating trade barriers, reducing business costs, harmonizing rules among TPP partners, and including robust protections for intellectual property rights and investors. In particular, RILA called on Congress and the Administration to create a new framework to govern trade in apparel and footwear in the ongoing TPP talks with Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam.
At the Subcommittee hearing lawmakers reviewed the status and future of the ongoing TPP agreement negotiations as well as the potential benefits of the agreement for U.S. companies, workers, and farmers. The hearing also explored how the TPP agreement will be a "21st Century agreement" by addressing barriers to trade beyond tariffs and increasing trade facilitation.
RILA and other interested associations have formed the TPP Apparel Coalition to aggressively advocate to Congress and the Administration that the U.S. position on apparel should be updated in the TPP to adopt rules of origin for apparel that are simple, flexible, and accommodate global value chains.
"RILA supports open economic engagement and free enterprise, including in apparel trade. Open competition in apparel creates healthier industries in both the United States and in our trading partners," said Stephanie Lester, vice president of international trade. "It is time for U.S. trade policy to reflect the commercial reality that globally-competitive American apparel producers and retailers have embraced international trade and have created global value chains that increasingly depend on the free flow of goods across borders."
A global value chain describes the full range of activities that firms and workers do to bring a product from its conception to the final customer. Nearly three million American workers are employed in the ideation and orchestration of the apparel global value chain-research, design, production, marketing, distribution, retail and support to the final customer. These American jobs rely on trade and would benefit from more flexible rules governing trade.
"U.S. tariffs on clothing and home linens are some of the highest in our Harmonized Tariff System (HTS), and account for approximately 68 percent of all duties collected from the TPP countries. These duties inhibit job growth, rather than foster it, and the TPP provides a unique opportunity to establish a new framework to facilitate trade and investment in our sector," Lester said.
In October, 30 bipartisan Members of the House of Representatives sent a letter to USTR Kirk urging the United States to adopt a new approach on apparel trade in the TPP agreement.
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