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January 21, 2019

Calls for US-UK trade pact to reduce access costs

The American Apparel & Footwear Association (AAFA) says a trade agreement between the US and the United Kingdom must ultimately expand trade between the two countries while reducing regulatory and market access costs currently associated with those trade links.

By Beth Wright

The American Apparel & Footwear Association (AAFA) says a trade agreement between the US and the United Kingdom must ultimately expand trade between the two countries while reducing regulatory and market access costs currently associated with those trade links.

The body, which represents US apparel and footwear retailers and importers, has submitted its comments to the Office of the US Trade Representative (USTR) and requested to testify at the 29 January hearing on the potential trade agreement.

An investigation to assess the likely economic effect of such a deal was started by the US International Trade Commission (USITC) last month. 

It follows the news earlier this year that the Trump Administration intends to negotiate three separate trade agreements with Japan, the European Union, and the United Kingdom.

The USITC expects to submit its report, which will be confidential, to the USTR by 8 May 2019.

In a letter addressed to Ed Gresser, chair of the Trade Policy Staff Committee, the AAFA set out a series of negotiating objectives for a US-UK Trade Agreement, the overarching goal of which should be to expand trade between the two countries.

“Not only should we be looking for increased market opportunities in the UK for US-made and US-branded exports, but we should also be looking for ways to increase opportunities to import inputs and finished products from the UK that we can use in our own manufacturing or sell to new and existing consumers in the US market,” the AAFA said in the letter. “Growing both sides of the trade equation with the UK will translate directly into growth at home, and our ability to sustain the millions of US jobs created and supported by trade.”

It added for these talks, as in all free trade agreement (FTA) negotiations, the Administration should set a goal to create more US economic opportunity and increase the percentage of duty-free trade relative to Normal Trade Relations (NTR) trade.

“Creating more opportunities to take advantage of FTAs will support far more US jobs and growth than restrictive rules,” it said, adding at the same time, the group wants to make sure that this trade is “expanded responsibly, by facilitating legitimate trade, thwarting illicit activities, and recognizing domestic sensitivities”.  

Within the letter, the AAFA outlined several recommendations to achieve this goal, including the immediate and reciprocal elimination of the high duties that both countries maintain on textiles, travel goods, footwear, crafting flexible rules of origin, and exploring cumulation provisions with joint FTA partners, including Mexico.

“Currently, many US yarn and fabric exports are sent to Mexico, where they are knit or woven into garments that are primarily re-exported back to the United States. How much more powerful would that supply chain be if apparel made in Mexico with US yarns and fabrics could be shipped duty-free into the UK? Likewise, consider the benefits if garments made in Mexico using British materials not found in the US could be enjoyed duty-free by US consumers,” the AAFA says.

Click here to read the letter in full. 

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