Friday, June 11, 2004

Bush Does the Right Thing on Trade

It's good to see the Bush administration stand up for free trade for once:

WASHINGTON, June 9 - More than 130 Republican and Democratic members of Congress asked President Bush on Wednesday to persuade the World Trade Organization to delay the phase-out of a global quota system on textiles and garments.

The administration swiftly rejected the request, which would mean breaking a 10-year-old global agreement to end the quotas on Jan. 1, 2005.

Ending the quotas could lead to a wide-ranging realignment of the industry and spell disaster for textile and apparel industries in dozens of nations, including those in the United States, according to officials of the American textile and apparel manufacturing industry.

Textile industries that were established in poor countries to take advantage of special quotas given by the United States or Europe are among those that the officials said would be threatened by the loss of special access to those huge markets.

Industry officials said that China and India could swamp the global market once quotas are lifted, destroying as many as 30 million jobs around the world and putting some of the world's poorest nations at risk.

In a letter to Mr. Bush, the 29 senators and 88 members of the House pointed to China as the biggest threat, accusing it of "unfair trade practices to heavily subsidize its exports."

"The U.S. textile sector, still the largest manufacturing employer in the United States, stands to lose almost 650,000 jobs," the letter stated.

But neither the W.T.O. nor the administration has endorsed the idea of revisiting the quota issue, and no country has agreed to raise it at the W.T.O.

The agreement to end the quotas was reached at the 1994 round of global trade talks in Uruguay and administration officials have pointed out that the developing nations asked for relief from the textile quotas during those talks.

Christopher Padilla, a spokesman for the office of the United States trade representative, said that the "United States will abide by its international obligations that were negotiated more than a decade ago to phase out remaining textile and apparel quotas at the end of the year."

Instead of fighting the quotas, the administration has been helping prepare the American industry for the new competition once the quotas are removed, Mr. Padilla said.

Recent bilateral and regional trade agreements have required nations to use American yarn and fabric if they want the benefit of duty-free access to the market in the United States.

But a new international coalition of textile and apparel industries and labor associations from 45 countries is asking the World Trade Organization to hold an emergency session next month to delay lifting the quotas.

Developing nations as diverse as Bangladesh, Mexico and Turkey are scrambling to devise some strategy that would preserve their textile industry without running afoul of global trade rules.

"We need fair trade so the global economy can be disciplined," Ziya Sukun, a representative of the Turkish textile and garment exports associations, said in a telephone news conference on Wednesday with American industry representatives.

"This is not protectionism but a fight against a monopoly by China," he said.
I'm still not happy about the agreements requiring other nations "to use American yarn and fabric", but at least Bush isn't caving in to the selfish demands of the US textile industry - a worse bunch of parasites it is hard to imagine.

What's even more interesting is the behavior of all the developing countries which have managed to carve out protected niches for themselves and are now scrambling about to prevent a supposed "monopoly" of the textile trade by China; who do they think they're fooling when they say this isn't protectionism?