The President is outlined proposals for an economic assistance package to help support businesses and workers who have been harmed by the coronavirus (Covid-19) outbreak

The President is outlined proposals for an economic assistance package to help support businesses and workers who have been harmed by the coronavirus (Covid-19) outbreak

The National Council of Textile Organizations (NCTO) has welcomed proposals from the Trump administration on an economic stimulus package to gird the economy against the impact of the coronavirus outbreak, but urged officials to reject any attempts by importers to remove China 301 tariffs on finished products as part of any relief package.

In an address to the nation yesterday (11 March), the US President said he would take "unprecedented" emergency action to provide financial relief to ensure working Americans impacted by the virus can stay at home without fear of financial hardship.

"This will be targeted for workers who are ill, quarantined, or caring for others due to coronavirus. I will be asking Congress to take legislative action to extend this relief."

While Trump noted this is "not a financial crisis," he outlined a series of steps to provide extra support.

"I am instructing the Small Business Administration (SBA) to exercise available authority to provide capital and liquidity to firms affected by the coronavirus.

"Effective immediately, the SBA will begin providing economic loans in affected states and territories. These low-interest loans will help small businesses overcome temporary economic disruptions caused by the virus. To this end, I am asking Congress to increase funding for this programme by an additional US$50bn.

"Using emergency authority, I will be instructing the Treasury Department to defer tax payments, without interest or penalties, for certain individuals and businesses negatively impacted. This action will provide more than $200bn of additional liquidity to the economy.

"Finally, I am calling on Congress to provide Americans with immediate payroll tax relief. Hopefully, they will consider this very strongly."

The President also issued a proclamation to restrict travel to the United States from foreign nationals who have recently been in certain European countries. The restriction applies to foreign nationals who have been in the Schengen Area – 26 countries in Europe with open borders agreements – in the last 14 days. However, the measures will not affect the UK and Ireland.

"To keep new cases from entering our shores, we will be suspending all travel from Europe to the United States for the next 30 days. The new rules will go into effect Friday at midnight. These restrictions will be adjusted subject to conditions on the ground," Trump said.

Commenting on the economic stimulus package proposals, Kim Glas, president and CEO of Washington, DC-based NCTO, which represents US textile manufacturers, including artificial and synthetic filament and fibre producers, said the body supports the administration's efforts to bolster the economy but opposes add-ons that would "exploit the crisis."

She added: "Any push by importers and retailers to take advantage of the situation and press for removing China 301 tariffs on finished consumer goods – a penalty imposed by the administration in a separate investigation of China's illegal intellectual property (IP) abuses – should be rejected immediately. Tariff breaks on finished products will only pad the pockets of retailers that have long benefitted from China's trade abuses, and ultimately will not be passed on to the consumer.

"Granting importers a tariff break would essentially let China off the hook for systemic IP violations that have displaced US workers and undermined US leverage in negotiating a phase two agreement."

As part of the Phase One trade deal agreed with China, the administration halved duties on finished apparel and textile products from 15% to 7.5% on 14 February.

"NCTO has strongly supported applying tariffs on finished products as a key negotiating leverage but opposes keeping tariffs in place on certain inputs that are not made in the US such as select dyes, chemicals and textile machinery. NCTO has long-argued tariffs on these inputs hurt domestic competitiveness for US textile manufacturers," Glas said.

Finished apparel, home furnishings and other made-up textile goods equate to 93.5% of US imports from China in the sector, while fibre, yarn, and fabric imports from China only represent 6.5%, according to government data, NCTO states.