Nicaragua Tariff Program Expiration Due to Devastate Supply Chains, Says AAFA Official
The expiration of a tariff preference program that allows the Nicaraguan apparel industry to incorporate 50 percent foreign fabric and still export to the U.S. duty-free will hurt U.S. jobs, businesses and consumers, said Rick Helfenbein, chairman of the board of the American Apparel and Footwear Association, in a Sourcing Journal Online op-ed. The program, due to run its course at the end of 2014 after 10 years in effect, allows Nicaragua to match U.S. fabric with fabric sourced elsewhere. The expiration will severely disrupt supply chains that have taken years and significant capital to shape, said Helfenbein.
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“For years, our apparel and footwear soldiers (non-uniformed) were courted by our government, and lured through trade agreements into [uncharted] territory. These pioneers built factories, provided jobs, sourced garment, and help stabilize third world countries,” said Helfenbein. “Bottom line: the powers in Washington should not invite us to the party, unless they plan to take a long term view of the situation. They shouldn’t ask us to invest, and then make our investment have a lesser value, because they lack continuity of the very trade prerogatives that put us there in the first place.”