The controversial Central American Free Trade Agreement (CAFTA-DR) was narrowly approved by the US House of Representatives early Thursday after intense White House lobbying.

The 217-215 vote ratified the trade deal championed by President Bush as a way of "strengthening democracy and advancing prosperity" in the western hemisphere, despite opposition from lawmakers in textile-producing states.

The Senate approved the trade agreement in late June, marking the first step towards removing trade barriers between the United States and Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and the Dominican Republic.

In a prelude to the CAFTA vote, key textile-state House members and the Bush Administration earlier this week reached an agreement to close several loopholes in the agreement covering Nicaragua tariff preference levels (TPLs), cumulation and pocketings.

US trade groups such as the National Council of Textile Organizations (NCTO) applauded the strong textile-state support for the agreement saying: "By voting for CAFTA, these members have given the US textile industry a platform to compete against China."   
NCTO continued: "Leading up to the debate on this agreement, key changes were made that make this an even stronger agreement for the US textile industry. 

"The primary concerns with pocketings and pocketing linings, TPLs and cumulation were addressed and will amount to almost $200 million in continued and new exports to the CAFTA region, already the second largest market for US manufactured textile goods." 
The American Apparel & Footwear Association (AAFA), whose members fought long and hard for CAFTA's passage, added that the agreement is critically important to secure jobs within the US and promote trade within the western hemisphere.

AAFA president and chief executive officer, Kevin M Burke, said: "It will provide fresh opportunities for the US textile, apparel, and footwear companies, and their US workers, to remain competitive in partnership with their Central American counterparts.
"By eliminating tariffs and other trade barriers, the agreement will help assure the future of US textile jobs and will enhance the stability of the economies and democracies of Central America.

"CAFTA-DR enjoys widespread support of the textile and apparel supply chain, and has been endorsed by more than a dozen trade associations representing cotton farmers, fibre manufactures, yarn spinners, fabric mills, and apparel companies."

However, the American Manufacturing Trade Action Coalition, which had opposed the agreement on the basis that it would increase imports and cost US jobs, said it was: "A sad day for US manufacturing workforce."