Presentation
1. China and the Quota Phase-out - 2. How to Counter3. Strategy
• World Pressure• Hill Pressure• Administration Outreach
4. Final Attempt• Voter Education Campaign - Grassroots
Pressure5. Coming Up….
Study: China’s Share of Apparel Removed From Quota in 2002
75-80%
53%
UPDATED72%
31%
9%
0%
100%
2001 2002 Jun 03 Jun 04 2004
30 months time - 72%
China 30 Months Later
2% 2% 2%4%
72%
3%2%0%
75%
China Thai Mexico CBI Taiw Bang Phil
China drops
prices 53%
Predictions Chinese shareCotton Sourcing Summit Survey – Miami 87% said: 50 – 90%
43% said: 75 - 90%
Past experience – other markets - apparel
Australia and Japan: 70 – 77%
Quota removed categories (as of June 04) 72% +
WTO Study (no recent data) 56% (China + India = 71%)
Analysis: Similar products70% – 85%
McKinsey Study & DHL Study 50% (safeguards)
ITC Study “Supplier of Choice”
World Bank Study (no recent data) 50%
How to Counter China
Government to use the “threat of market disruption” track of WTO safeguard clause to keep China under control until 2008
Aggressive use of trade remedies to go after Chinese and other countries unfair trade practices post 2005
China WTO Textile Safeguard
Takes until Aug 1 to get a decision – lasts only until Dec 31.
Process starts over again in January 05
5 month safeguard each year
“Threat” Case
File prior to China going off quota – decision in January.
Under “threat,” China will held to 2004 quota levels plus 7.5%;
Will force China to the table to negotiate a comprehensive agreement covering the next three years.
Government on using “Threat”
Big Confrontation with China / importers and retailers strongly oppose
Refused to consider in previous safeguard actions
Not released criteria to even file a case
Industry Strategy
1. Worldwide Coalition
2. Hill Pressure
3. Grassroots Campaign
Gov. Restrains
China Using
“Threat”
World Wide Pressure
Global Alliance for Fair Textile Trade (GAFTT)
• Begun March 2004• Now 102 trade groups from 51 countries• Events in Istanbul, Johannesburg,
Kampala, Brussels and Geneva
www.fairtextiletrade.org
Growing Global Effort 9 countries have announced at WTO
that something must be done about China – Mexico, Turkey, Bangladesh, Indonesia, Sri Lanka, Mauritius, Nepal, Dominican Republic, Madagascar
30 million jobs are predicted to be lost
Concerns about economic dislocation, instability, increased poverty, terrorism
WTO to meet Oct. 1st
Council on Trade in Goods
More countries expected to speak up
Make sure that they support use of “threat”
Increase pressure on White House to act on developing countries behalf
Hill Pressure
Two letters on China and safeguards – over 100 signatures on each
Unity DAY- July 20th – over 100 textile executives visited more than 40 offices to talk about China
High level meetings with DOLE and BURR to plan strategy re: White House
Administration Outreach
4 attempts (NCC, NCTO) to meet with Aldonas/Commerce over China & CAFTA since January
First meeting took place last week to begin to discuss criteria for “threat”
Meeting w/Zoellick – warning over confrontation
Outreach to White House
Gant has used personal channels Burr has called twice Dole has met with Zoellick and called
White House. Also wrote to Powell. Zoellick has called twice Aldonas has now called
NO RESPONSE TO DATE
Final Attempt
Voter Education Campaign Targeted on Trade and Loss of Jobs
Overseas – N. Carolina heavy + S. Carolina
Ramp Up Over Time: Billboards then Radio
Can be stopped at any time
Stop Sending Jobs
OverseasChange Trade Policy NowChange Trade Policy Now
Register…Vote!www.myjobcounts.orgwww.myjobcounts.org
Change Trade Policy Now
Grassroots Portion
“Textile coordinators” in every plant Voter registration drives 4 major rallies Website: www.myjobcounts.org Editorial boards/leafleting/letters to
editor/billboards/bumper stickers