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The times, they are still "a-changing." While politics and accusations of wrongdoing continue to render some textiles and apparel markets difficult to tap, liberalized quotas, reasonably priced labor and increasingly sophisticated manufacturing capabilities are creating new opportunities for shippers and carriers. Here's the latest developments within specific markets:
CHINA
While China's share of U.S. textile and apparel imports now stands at 15 percent ($3.5 billion), myriad legislative and non-legislative developments could soon deflate these figures.
Notably, Most Favored Nation (MFN) status still permits China to remit the lowest possible general import duties. However, in June, the U.S. Congress will be reviewing a bill that would deprive China this privilege and impose higher Column II rates. Should the legislation pass, ad valorem duties may rise as much as 100 percent, thereby forcing shippers to source elsewhere.
"Whether China stays in the realm with stipulations, as I believe will happen, or is indeed stripped of its rights, recessionary conditions make it impossible to absorb the cost increases higher duties necessitate," said Sally Wread, import/export manager, Totes Inc., Loveland, Ohio. "Consumers are hurting and won't tolerate the higher prices we would consequently have little choice but to impose."
George Horowitz, president of Total Impact, New York City, expressed similar views. To him the idea of paying stiffer duties for Chinese goods gives shippers a rationale for patronizing nations with underutilized quotas. "The only product that could not be replaced elsewhere is silk," he observed.
Actions being taken by the United States under a law known as Special 310 are also expected to clog Chinese clothing/fabric pipelines. Enactment of Special 310 would permit American retaliation against continued Chinese patent and copyright piracy with punitive tariffs of 100 percent on silk blouses, silk dresses and footwear. Although a spokesperson for U.S. Trade Representative (USTR) Carla Hills said the final list of items facing trade sanctions is still being formulated, importers appear fearful to await the final verdict. "President Bush has promised to get tough on China about infringement. With the election coming up, he won't skirt the issue," one retail conglomerate's import director said. "As a result, we--like many organizations in our industry--are actively looking at places to find product at a rate we can bear."
Additionally, a statement...