TRADE IN THE TRUMP ADMINISTRATION AND NAFTA RE-NEGOTIATIONS · ADMINISTRATION AND NAFTA...

TRADE IN THE TRUMP ADMINISTRATION ANDNAFTA RE-NEGOTIATIONS

Steve Lamar, Executive Vice President, AAFA

About AAFA

Clothes, Shoes, and Travel

Goods47%Other Products

53%

Allocation of U.S. Import Duties Collected by U.S. Government - 2016

Source: USITCTotal Duties Collected: $32.4 billion

Clothes, Shoes, and Travel

Goods5%

Other Products95%

Allocation of U.S. Imports by Import Value

Source: USITCTotal Imports: $2.16 trillion

Apparel, Footwear, and Travel Goods - Tariffs

Clothes, Shoes, and Travel Goods Account for 5% of All U.S. Imports Yet Generate 47% of All

U.S. Duties Collected

Trade Policy (1)• Trade Policy Review/Overhaul/Studies

• Trade Remedies• Ex. Steel/Aluminum Section 232

• Enforcement• Ex. China IPR Section 301

• Buy American

• Trade Agreements Review• NAFTA• KORUS

• Focus on • Lowering Trade Deficits, • Increasing Enforcement, & • Growing U.S. Exports

Trade Policy (2)

• Generalized System of Preferences (GSP)

• GSP Footwear

• Miscellaneous Tariff Bill (MTB)

• Caribbean Basin Trade Partnership Act (CBTPA)

• African Growth and Opportunity Act (AGOA)

NAFTA: Terminate or Negotiate

NAFTA - TPA Timeline

You AreHere

Negotiation Next Steps?• First Round – Washington, DC (August 14-18)• Second Round – Mexico City (September 1-5)• Third Round – Ottawa (September 23-27)• Fourth Round – Washington, DC (October 18-24)• Fifth Round – Mexico City (November 17-21)• Sixth Round – Washington, DC (December?)

What Does NAFTA 2.0 Look Like?

Modernization TrumpTraditional

• ROO• TPL• Short Supply• Chapter Notes• Other

• Customs

• Safeguards

Issues at Stake

What Should Happen?• Do No Harm

• Keep It Trilateral

• Make It Seamless

• Make NAFTA Work Better

How American Are Your Mexican Jeans?

Labels/PackagingMade In:CA, NC, NJ, VA, PA, OH, FL

ZippersMade In:GA, NC, CA

YarnSpun In:NC, SC, GA

Sewing ThreadSpun In: NC, GA

CottonGrown In: 17 states, stretching from Virginia to California

DenimWoven In:NC, TX, GA

PocketingMade In:NC, SC, MS, GA

Buttons, Rivets, SnapsMade In:KY, GA

U.S. Apparel Import Snapshot

0

0.5

1

1.5

2

2.5

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*

Index of Apparel Imports (2000 to 2017)2000 = 1

ROW

NAFTA

CAFTA-DR

Source: OTEXA

U.S. Textile Export Snapshot

4.00

5.00

6.00

7.00

8.00

9.00

10.00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

U.S. Textile Exports to NAFTA/CAFTA(billions of U.S. dollars)

Source: OTEXA

Why Seamless Matters

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

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Effective Duty Rate of U.S. Apparel Imports From Colombia2012 (by month)

Colombia FTA Turns OnATPDEA Turns Off

Source: USITC

Four Scenarios• Withdrawal and Termination

• Withdrawal

• Changes

• Status Quo

Questions?

Steve LamarExecutive Vice PresidentAAFAslamar@aafaglobal.org571.332.6449