[Congressional Record Volume 159, Number 82 (Tuesday, June 11, 2013)]
[Senate]
[Pages S4214-S4215]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN:
  S. 1136. A bill to authorize the extension of preferential tariff 
treatment for certain textile goods imported from Nicaragua; to the 
Committee on Finance.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce legislation 
to extend a critical textile and apparel trade program with Nicaragua, 
currently set to expire at the end of 2014 through the end of 2024.
  This is a unique program which benefits not only Nicaraguan apparel 
factories and U.S. apparel companies and retailers, but U.S. fabric and 
yarn mills as well.
  Let me explain.
  In an effort to promote trade between the United States and 
Nicaragua, the 2006 Central American Free Trade Agreement, CAFTA, 
allows Nicaragua to export to the United States a limited amount of 
apparel products duty free regardless of the source of the yarn or 
fabric.
  Specifically, this Tariff Preference Level, TPL, allows Nicaragua to 
export 100 million square meter equivalents, SMEs, of apparel made with 
fabric from non-CAFTA countries as long as the apparel is assembled in 
Nicaragua.
  In order to ensure that U.S. fabric producers could also take 
advantage of this program, it contains a special rule for trousers.
  It requires Nicaragua to purchase one square meter of U.S. fabric for 
every one square meter of non-CAFTA woven trouser fabric.
  That is, under this ``one for one'' rule, for each export of woven 
trousers made from non-CAFTA fabric, Nicaragua agreed to export to the 
U.S. an equal amount of woven trousers made of U.S. fabric, up to a 
certain level 50 million square meter equivalents.
  This ``one for one'' feature has been especially successful, 
resulting in an increase in U.S. fabric exports to Nicaragua and an 
increase in apparel production jobs in Central America.
  In fact, since 2006, when the program went into effect, U.S. fabric 
exports to Nicaragua have nearly doubled from $57.3 million to $110.2 
million.
  Nicaragua is now the fastest growing market for U.S. fabric exports 
to the CAFTA region.
  Nicaragua has also greatly benefited from this program.
  I would remind my colleagues that Nicaragua, with a GDP per capita of 
$3,300, is the poorest country in Central America and the second 
poorest country in the Western Hemisphere.
  Approximately 42.5 percent of Nicaragua's population lives below the 
poverty line.
  It is vital that Nicaragua develop and grow new export opportunities 
to help lift its people out of poverty. And that is what this program 
has done.
  Since 2006, total apparel exports from Nicaragua to the U.S. have 
doubled. The program now accounts for 25 percent of those exports.
  Between 2005 and 2013, jobs in the apparel sector in Nicaragua have 
grown

[[Page S4215]]

by 23 percent. That is, 13,236 new jobs have been created since CAFTA 
went into effect.
  With a program that has proven to be so successful and mutually 
beneficial, it is appropriate for Congress to extend it and ensure that 
these benefits continue.
  Some of my colleagues may wonder why I am introducing legislation now 
to extend a textile and apparel trade program that will not expire 
until the end of 2014.
  The simple answer is that an early renewal is critical for business 
planning purposes.
  U.S. companies that have taken advantage of this program are making 
decisions now about their long-term investments and where they will 
source apparel products.
  Extending this program several months before its expiration date will 
help give U.S. companies the necessary confidence to continue to invest 
in Nicaragua and take advantage of its benefits.
  If we wait until the last minute to extend the program, the ties that 
have been developed between U.S. and Nicaraguan companies and the 
benefits accrued will be put at risk.
  Simply put, U.S. companies will not make the commitments to Nicaragua 
if there is a chance the textile and apparel trade program will lapse.
  They will look elsewhere for new business opportunities to avoid what 
would in essence be a new trade barrier to U.S. textile exports and 
U.S. apparel companies in Nicaragua.
  And as U.S. apparel orders from Nicaragua decline, U.S. textile 
exports to Nicaragua will also decline. Jobs will be lost.
  U.S. companies are looking for assurances that the U.S. is committed 
to this program after 2014 and that is why this legislation is needed 
now.
  It is supported by the American Apparel and Footwear Association, the 
National Retail Federation, the Retail Industry Leaders Association, 
and the United States Association of Importers of Textile and Apparel.
  It is a win-win trade program promoting jobs and economic growth in 
both countries.
  Nicaragua will be able to continue to develop a vital export industry 
and U.S. apparel companies, retailers, and textile manufacturers will 
continue to access a growing, thriving market in Central America.
  I urge my colleagues to support this legislation.
                                 ______