CAFTA

1
CAFTA The Current Situation Next Steps Apparel
Sourcing Show Guatemala Nate Herman Director of
International Trade American Apparel Footwear
Association May 2006
2
CAFTAThe Good, the Bad,and the Ugly

• The Good News
• The Bad News
• The Ugly
• How Do We Return to the Good?

3
CAFTAThe Good, the Bad,and the Ugly

• The Good News
• The Bad News
• The Ugly
• How Do We Return to the Good?

4
CAFTA The Good News

• El Salvador, Honduras Nicaragua Have
  Implemented CAFTA
• Guatemala Joining June 1
• Thanks to CAFTA, the region is experiencing
  growth this year in key categories
• Swimwear Exports on Rise
• Footwear Exports Up Double Digits from Some
  Countries
• Luggage/Briefcase Exports Up

5
CAFTAThe Good, the Bad,and the Ugly

• The Good News
• The Bad News
• The Ugly
• How Do We Return to the Good?

6
CAFTA The Bad News

• Almost Two Years After Agreement Signed, Only
  FOUR countries have joined CAFTA
• Implementation Delays
• Co-Production/Retroactivity Issue
• Washington is Calling
• Continued Uncertainty Also Caused by
• Last-Minute Deals in Washington
• Pocketing Fabrics
• Socks
• Technical Problems
• Cumulation

7
CAFTA The Bad News

• Almost Two Years After Agreement Signed, Only
  FOUR countries have joined CAFTA
• Implementation Delays
• Co-Production/Retroactivity Issue
• Washington is CallingAnd Saying No More CAFTA
• Continued Uncertainty Also Caused by
• Last-Minute Deals in Washington
• Pocketing Fabrics
• Socks
• Technical Problems
• Cumulation

8
Average Duty Collected on U.S. Apparel Imports
from El Salvador 2005-2006
Source U.S. International Trade Commissions
Trade Dataweb
9
CAFTA The Bad News

• Almost Two Years After Agreement Signed, Only
  FOUR countries have joined CAFTA
• Implementation Delays
• Co-Production/Retroactivity Issue
• Washington is CallingAnd Saying No More CAFTA
• Continued Uncertainty Also Caused by
• Last-Minute Deals in Washington
• Pocketing Fabrics
• Socks
• Technical Problems
• Cumulation

10
CAFTA The Bad News

• Almost Two Years After Agreement Signed, Only
  FOUR countries have joined CAFTA
• Implementation Delays
• Co-Production/Retroactivity Issue
• Washington is CallingAnd Saying No More CAFTA
• Continued Uncertainty Also Caused by
• Last-Minute Deals in Washington
• Pocketing Fabrics
• Socks
• Technical Problems
• Cumulation

11
CAFTAThe Good, the Bad,and the Ugly

• The Good News
• The Bad News
• The Ugly
• How Do We Return to the Good?

12
U.S. Apparel Imports from CAFTA Region
Source OTEXA, U.S. Commerce Department
13
U.S. Apparel Imports from CAFTA Region
Source OTEXA, U.S. Commerce Department 2006 is
an annualized figure based on Jan-Mar 2006
imports.
14
U.S. Apparel Imports from CAFTA Region
Source OTEXA, U.S. Commerce Department
15
U.S. Textile Exports to CAFTA Region
Source OTEXA, U.S. Commerce Department
16
CAFTAThe Good, the Bad,and the Ugly

• The Good News
• The Bad News
• The Ugly
• How Do We Return to the Good?

17
CAFTA Returning to the Good

• Most problems resolved when ALL countries join
  CAFTA
• AAFA and Others Pushing Congress for Temporary
  Fix
• Finish Pocketing Negotiations as Soon As Possible
  Work for Congressional Passage
• Implement Cumulation ASAP

18
Thank You!
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22209 703-797-9041 slamar_at_apparelandfootwear.org w
ww.apparelandfootwear.org