The American Apparel & Footwear Association (AAFA) submitted comments to the U.S. Department of Commerce regarding President Barack Obama's commitment to double U.S. exports by 2015. Responding to a call for comments on the National Export Initiative (NEI), AAFA highlighted a ten-step plan that can help make the NEI's goal of doubling U.S. exports a reality.
“As an industry that makes everywhere and sells everywhere, the U.S. apparel and footwear industry stands behind the National Export Initiative,” said AAFA President and CEO Kevin M. Burke. “Opening new markets to the free flow of goods and improving current trade flows will allow U.S. companies and their goods to become even more competitive in the global market.”
“To achieve this goal, the Obama Administration and Congress must work in concert with stakeholders and the public to leverage and maximize every opportunity for growth,” Burke said. “We cannot afford to leave any option off the table. Whether improving access to export financing, continuing to open new markets, improving existing trade agreements, or even facilitating imports, every component is critical to realizing the final goal.”
Because one in five jobs in the United States is dependent upon international trade, embracing a forward-thinking and practical trade policy will have a direct and beneficial impact on our economy through job creation. It must be understood that creating jobs through trade means that those jobs will rely on trade as a sustaining factor. Closing markets and erecting barriers to trade either now or down the road will only erode job creation and cause a setback to the United States' overall economic health.
“AAFA applauds President Obama for committing to the goal of doubling U.S. exports by 2015 for the purpose of creating two million new jobs and sustaining countless others,” said Burke.
“The U.S. apparel and footwear industry will continue to educate all stakeholders about solutions to the many challenges ahead, including education about the important role that U.S.-branded products play in creating and sustaining jobs in the United States.”
AFA Ten-Step Plan Overview
As part of AAFA's comment submission today, AAFA would like to offer a ten-step plan that can help in achieving the goals of the National Export Initiative. AAFA's full comment submission can be found on the AAFA Web site.
- In order for our domestic manufacturers to step up to the plate and start filling double the orders, small and medium sized enterprises must be able to access the credit that serves as the lifeblood of their business.
- By Congress passing already negotiated pending trade promotion agreements with Colombia, Panama, and South Korea, our producers would have unfettered access to over 100 million new consumers who are eager to purchase our goods and services.
- Because 95 percent of the world's consumers live outside the United States, we need to open as many markets as possible. By participating in such initiatives like the Trans-Pacific Partnership, we will acquire the market access we need to double our exports.
- As times change, we need to ensure that our current agreements fit the bill with regard to technological developments, intellectual property protections, and new market opening opportunities.
- We must finally achieve a successful and ambitious conclusion to the Doha Round of trade negotiations at the World Trade Organization that started in 2001.
- A globalized economy is strongest when everyone adheres to the international rules-based trading system.
- Just as the United States expects its trading partners to play by the rules, the United States must live up to that same standard.
- U.S. exports are not just products made here at home. U.S. companies make U.S.-branded products everywhere. They also sell them everywhere – with those products sometimes never coming home before they are purchased by a customer in another country. However, U.S. workers still design, market, and sell those products. Further, those earnings still come home. To maximize those valuable exports, we must ensure that we are facilitating those transactions as well.
- If we do not appreciate and support the role that imports play in an export-driven economy, we lose our comparative advantage. We can make all the quality products in the world, but if we refuse to buy from others, others will refuse to buy from us.
- Setting our sights on the goal of doubling exports is great. But thinking and acting within the parameters of simply meeting a goal only limits the possibility of quadrupling our exports.
Domestic Industry Benefit
Domestic manufacturers of apparel and footwear products primarily operate under the Berry Amendment (USC, Title 10, Section 2533a), which requires 100 percent sourcing of military uniforms, footwear and other textile-based equipment for the Department of Defense. The domestic companies that manufacture these items are often small to medium-sized businesses (SMEs) who have little to no commercial business due to the specialty nature of the military items they produce.
AAFA surveyed its domestic manufacturers and found that only a small percentage actually export overseas. Of the companies who do export, less than five percent of their total sales resulted from their export business. When they do export, they reach several different countries including: China (and Hong Kong), Mexico, Italy, Japan, Saudi Arabia, the United Kingdom, Canada, Brazil, Korea, Israel and some European countries.
The types of products exported have included soling materials for footwear, waterproof fabric for footwear, broad nylon fabric, modacrylic fabric, coveralls, fire resistant treated cotton knit fabric, fire resistant treated viscose knit fabric and Nomex knitted fabric-inputs that go in to finished products made overseas.
Regrettably, despite the fact that these apparel and footwear manufacturers are producing some of the most technologically advanced apparel and footwear in the word, the predominant export in the apparel and footwear industry tends to come from the large suppliers, who ship fabrics overseas for the commercial market, not the end-item manufacturers.
Moreover, AAFA members for the most part did not utilize any U.S. government assistance, nor were many even aware that any U.S. government assistance was even available. This example highlights both the opportunity for growth and the need for a realistic strategy to achieve that growth.
