US docks go into overdrive following agreement
Following an announcement on November 23 that the union and shipping companies had negotiated a new six-year contract, footwear and other products began flowing freely to department stores and other retailers with products created for the Christmas market.
When the unions and shippers failed to reach an agreement in October, the shippers locked the workers out for more than 10 days (see Leatherbiz.com ‘Bush administration intervenes in dock dispute’ 9/10/2002). The losses in fresh fruit were staggering, while non-perishable products were able to withstand the work stoppage.
The American Apparel and Footwear Association applauded the agreement, and noted that it was continually working to get the west coast ports to open. AAFA joined with the U.S. Chamber of Commerce and over 100 other trade associations to get the two sides to agree before the ports could be shut down again.
It is expected the agreement will be ratified by the 10,500 workers by mid-January. Meanwhile, the workers are moving products off the docks as fast as they can.
The U.S. Customs Service has released instructions for firms importing footwear or apparel duty-free from Bolivia, Colombia, Ecuador and Peru. Under the newly revised Andean Trade Promotion and Drug Eradication Act all Andean footwear except Class 17 (rubber/fabric and plastic/protective items can now enter the U.S. duty free).
It should be noted that the rules of origin for footwear only require that 35% of the value-added of the shoe must be done in the Andean region, the United States, and/or the Caribbean Basin region.
The U.S. Government announced on November 26 a new proposal that would see the elimination of all non-rubber footwear tariff and non-tariff barriers ending world-wide within 10 years.
This new proposal is to be submitted as part of the ongoing DOHA round of global trade negotiations. It calls for a worldwide, multi-phase elimination of duties on all non-agricultural tariffs between 2005 and 2010. By 2010 many existing duties would be eliminated entirely, while all other duties would be reduced to a level no greater than 8%.All remaining duties would be eliminated by 2015.
AAFA president and CEO, Kevin M. Burke noted: "This proposal not only removes U.S. import barriers, but also eliminates barriers that are imposed on U.S. branded footwear and apparel by other countries."
Participating in the 21st meeting of the Asian Footwear Federation in Hong Kong on November 18-19, the American Apparel and Footwear Association began discussions with these important associations to create an agreement to reduce nonrubber footwear tariffs worldwide in the context of the DOHA round of global trade talks.
Both apparel and footwear imports show signs of recovery for the first nine months of 2002. Apparel imports were said to have reached 12.89 billion square meter equivalents, an increase of about 4.2% over the same period last year, while footwear imports to have increased 3.9%over the same period last year, about 1.47 billion pairs. The value of the imports, according to the U.S. Department of Commerce, declined by 1.9% for the period to $11.5 billion.
China controlled 80.4% of the footwear market, while imports from Vietnam more than doubled last year’s effort. This makes Vietnam the seventh largest exporter of footwear to the U.S. Brazil, the second largest supplier of footwear to the U.S. also saw increases for the period.
While the top ten suppliers for the first nine months supplied 97.5% of the imports, the top five countries were: China 1.2 billion pairs); Brazil (81.7 million pairs); Indonesia ( 57.2 million pairs; Italy (33.8 million pairs); and Thailand (21.2 million pairs.
