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    Extending AGOA'S Third Country Fabric Terms To Promote The Development Of African Apparel Industry

    2012/5/16 10:57:00 14

    FabricAfrican Apparel IndustryGarment Industry

    The US Trade Representative Office (USTR) said that the United States is committed to promoting trade with African and Latin American countries through the African Growth and Opportunity Act (AGOA) and our sub Saharan trade preferences scheme and our Central American Republic of Dominica - the American Free Trade Agreement (CAFTA DR).


    The urgent modifications required by the African Growth and Opportunities Act and CAFTA-DR will be based on two key trade promotion measures in the United States, which will support more than 45 United States Trade and investment in Africa and Western Hemisphere developing countries, provide tax exemption for their products, promote regional integration, establish high standards of accountability, enhance pparency, establish good governance, create trade and economic opportunities, and promote sustainable growth and development.


    If they can grow through trade and investment, these countries can also provide some of the best markets for US companies to sell their products and services to American businesses.


    Extending the third country of AGOA

    Fabric

    clause


    The key to the performance of the African Growth and Opportunity Act: the African Growth and Opportunity Act is the cornerstone of trade and investment policies in the United States and sub Saharan Africa.

    The performance and effectiveness of the African Growth and Opportunity Act is closely related to the provisions of the third country fabric (TCF), which expires in September 2012.


      

    African apparel industry

    The development depends on AGOA.

    Clothing trade

    The TCF requirement.

    Global sourcing decisions are usually made 9 months in advance, so if the existing TCF regulations can not be extended, it means that garment buyers are preparing to move their production out of AGOA beneficiary countries, which may lead to a large number of unemployment and factory closures in Africa.


    The extension of AGOA's third country fabric clause will provide a helping group for US retailers, businesses and consumers: imports under AGOA, especially clothing imports, may help us retailers reduce the cost of clothing products through the TCF clause.

    The TCF clause also creates opportunities for retailers to diversify their supply and provide low-cost clothing for us apparel retailers and consumers.


    These countries, if they can grow through trade and investment growth, will also provide the best market for US companies to sell them.


    Modifications to sewing lines alone will help support about 1000 jobs in the United States, Central America and Dominica.


    The amendments to the CAFTA-DR agreement provide strong support for the domestic textile industry and the importers and retailers from the region.


    The US textile and apparel sector and the US partners in CAFTA-DR will benefit.

    In the 12 months ending February 2012, US textile and clothing exports to the CAFTA-DR region were US $3 billion 800 million, an increase of 15% over the same period last year.


    From March 2011 to February 2012, the United States imported textiles and clothing from CAFTA-DR for 8 billion US dollars, an increase of 10% over the same period last year.

    About 73% of these imports are made in the United States or yarns and fabrics produced in the area.


    For these reasons, the US Congress is in urgent need of action to extend the stipulation of the third country fabric (TCF) in AGOA and to implement CAFTA-DR technical modification related to textile and clothing as soon as possible.

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