Vietnam trade deal called threat to textiles

A new trade deal with Vietnam could threaten what’s left of the U.S. textile industry, Easley businessman Smyth McKissick told congressional lawmakers Tuesday.

President Barack Obama’s administration is negotiating the Trans-Pacific Partnership agreement, or TPP, with several other countries as a way to expand U.S. economic interests in the Asia-Pacific region.

McKissick, chief executive officer of Alice Manufacturing, said details of how the deal will treat textiles and apparel made in Vietnam will have a major impact on the American industry that employs 500,000 people nationwide.

“U.S. manufacturing jobs are at stake and it’s critical our negotiators get this trade agreement right,” McKissick told the House Small Business Subcommittee on Economic Growth, Tax and Capital Access. “A poorly negotiated TPP will cause widespread job losses in the U.S. and the Western Hemisphere.”

McKissick testified on behalf of the National Council of Textile Organizations.

A key issue is the “yarn-forward” rule, which means yarn and fabric must be manufactured and assembled in the free-trade partner country in order to enter U.S. markets tariff-free.

The American industry is worried that without the rule, China would route its textile products through Vietnam’s government-subsidized textile industry for final cutting and sewing, and use Vietnam’s favored-trade status to cheaply export the products to the U.S.

“If this occurs, Vietnam and China stand to gain billions of dollars in textile trade at our industry’s expense,” McKissick said.

McKissick, who lives in Greenville, also encouraged members of Congress to sign a letter to the U.S. trade representative, asking him to maintain the yarn-forward rule, which has been included in every major U.S. free trade deal for the last 25 years.

So far, more than 160 Democrats and Republicans have signed the letter, including six of the seven members of the S.C. delegation.

The only South Carolina member not to sign the letter this year is Rep. Mark Sanford, R-Charleston.

Sanford “has always believed in allowing the U.S. trade representative to negotiate the best deal possible for the U.S., and then Congress voting up or down at that time. When this trade pact comes to the Congress, he will make a determination as to whether or not that agreement is in the best interest of South Carolina and the United States,” said his spokeswoman, Jennifer Drogus.