AGOA Third Country Fabric Provision Extended to 2015

With the AGOA’s Favorable Duty Rates, Apparel Importers Can Find Greater Savings When Sourcing From African Countries

The cost of an imported product can vary tremendously when the amount of duty to be paid is factored into the equation, and in the case of apparel, it can run anywhere from an average of $16 to $32 extra for every $100 imported into the US, when made in a foreign country such as China.

The African Growth and Opportunity Act (AGOA) has a provision for imports of apparel when sourced from certain Sub-Saharan African countries, where such clothing originates from either African or US components.  It provides for the duty-free treatment of these products which means rather than paying the additional $16-$32 in duties for every $100 of imported apparel, $0 in duties is instead owed.

Within the AGOA is a “Third Country Fabric” provision which allows fabrics from other countries to be used in the manufacturing process and still qualify for the benefit of “AGOA treatment,” i.e., duty free treatment, of the product.

Last Friday, August 10, 2012, President Obama signed the bill (H.R. 5986) which had been passed on August 2, 2012 by the House and Senate to amend the African Growth and Opportunity Act’s (AGOA) “Third Country Fabric Program” as well as to add South Sudan to the list of countries eligible for designation under the AGOA.

With this passage, apparel importers can now continue to place orders with African manufacturers with the knowledge that these duty savings will continue for the next few years, saving them money, and perhaps saving us consumers some as well.

Questions/comments?  Post below or email me at clark.deanna@gmail.com

Africa Sourcing and the AGOA Extension

"AGOA Provision Related to the Third Country Fabric Provision Anticipated to Pass Congress Next Week"

    

     --  Staff Member, U.S. Senator Menendez' office in DC

This week I attended TEXWORLD in NYC, which is a textiles and apparel trade show open to those of us in the industry and the public at large. 

While Chinese suppliers made up a large majority, I was pleased to see others hailing from S. Korea, Turkey, and of course, India, among others, as well as a corridor for African sourcing, with a number of vendors from Mauritius, and Origin Africa (http://originafrica.org).

Together at the convention were a series of public seminars, one of which focused on trade and Africa, and particularly on sourcing from Africa. Many companies are interested in sourcing from Africa, and this interest has been steadily growing since the AGOA agreement came into effect.

Currently, we are awaiting the (hoped for and) anticipated passage of a special provision of the African Growth and Opportunity Act (AGOA) which allows fabrics from other countries to be used in the manufacturing process and still qualify for the benefit of “AGOA treatment, ” i.e., duty free treatment, of the product.  For more information on AGOA, check out my other articles here:

The African Fashion Industry – Can in Benefit From AGOA?

The African Fashion Industry and AGOA

I spoke with Senator Menendez’ (NJ state senator) staff in Washington DC yesterday, who assured me that there is a lot of bi-partisan support for the passage of the AGOA provision awaiting passage by the Senate, which involves the continued permission for imports into the US to qualify for the duty-free treatment accorded by the AGOA agreement when fabrics from non-African/non-US countries had been used in the construction of the garment.

I expressed to the staff member that these types of delays make it difficult for businesses to accurately make financial projections in the uncertain commercial environment created when company’s do not know if their cost of importation is going to rise, on average, from anywhere between 10% to 35%.  It therefore, could serve as a deterrent from sourcing from Africa which defeats the whole purpose of a program like the AGOA that is intended to promote increased sourcing from Sub-Saharan Africa.

He assured me that this was known but explained that the AGOA passage was tied up with other trade bills that likewise needed support and which, in their current forms, were not fully supported.

Many people are calling there to express their support for the passage and I encourage you to do the same.  The telephone nos. for Senator Menendez’ office is (202) 224-4744 and the general switchboard in order to be connected to any U.S. Senator’s office is (202) 224-3121.

Feel free to call over there and when connected to a Senator’s office, tell them you would like to speak to someone regarding the “Africa trade bill,” – they’re more likely to understand this comment than stating the "AGOA agreement" - and then express why continued legislative AGOA support is important to you.

Exercise your voice.  Isn’t this what a democracy is all about?

Questions/comments?  Post below or email me at clark.deanna@gmail.com

International Trade and Marketing for the Fashion Industries at FIT

The mission of ITM is to prepare students for entry-level managerial positions in international operations of fashion and related businesses, including import/export, legal and finance documentation, customs compliance, trade policies, management, marketing, sourcing, logistics, and international business ethics.

Last week I had the pleasure of meeting with Christine Pomeranz, the Chair of the International Trade and Marketing Program (ITM) at SUNY’s Fashion Institute of Technology. This is by far one of the coolest programs I have ever come across and given the volume of imports of textiles and apparel into the U.S., it makes perfect sense that this kind of program would be included in a school focused on fashion.

As soon as I walked onto the campus I instantly felt at home. The student body was lively, diverse and dynamic, and with student elections pending, I noticed creative fashion-focused “vote-for-me” signs, some of which were even inspired by famous designer logos. Seeing these surroundings completely put me at ease to discuss potential future adjunct faculty positions in the areas of International Trade Law or International Trade and Fashion Law with Chairwoman Pomeranz.

During our conversation I became evermore impressed with the ITM program’s focus and caliber. There are four (4) different “tracks” that students can follow. They are:

1. International Trade Law and Fashion Law
2. International Business Management
3. International Trade and Policy Management
4. International Marketing Management

Whichever track is chosen, all students in the ITM program must take core courses in international trade, international business transactions, global marketing, import/export regulations, and global sourcing, as well as taking a practicum in international trade or a senior internship. All of these are integral to a well rounded education in international trade if you ask me!

I truly enjoyed learning about the ITM program and look forward to the opportunity to be included as an adjunct faculty member. To learn more about the program click here. Check it out!

Questions/comments? Post below or email me at clark.deanna@gmail.com