US-Indonesian deal to stop illegal textile trade http://today.reuters.com/news/articlenews.aspx?type=politicsNews&storyID=2006-09-26T232302Z_01_N26380703_RTRUKOC_0_US-TRADE-INDONESIA-USA.xml&archived=False
Tue Sep 26, 2006
WASHINGTON (Reuters) - The United States and Indonesia signed an agreement on Tuesday to stop clothing from China, Vietnam and potentially other suppliers from illegally entering the U.S. market as Indonesian goods."Transshipments have jeopardized Indonesia's legitimate textile and apparel exports by taking up market space in the United States," U.S. Trade Representative Susan Schwab said at a ceremony to sign the pact.
The United States still has quotas on textile and clothing from Vietnam and China, creating an incentive for exporters in those countries to transship their goods throughout another country to avoid U.S. import curbs.
The new memorandum of understanding provides for customs cooperation between the two countries and allows for joint verification visits to ensure clothing and textile imports from Indonesia are legitimate, U.S. trade officials said.
Indonesian Trade Minister Marie Elka Pangestu said the textile accord was part of a "building block" approach to increasing trade ties with the United States.
Indonesia sees the United States as a potential free trade partner, but is approaching that goal gradually, she said.
Indonesia's textiles and clothing exports to the United States grew nearly 19 percent in 2005 to $3.13 billion, and the new pact could help increase that, Indonesian officials said.
The United States will be required to lift import quotas on textile and clothing from Vietnam, once that country enters the World Trade Organization. Hanoi hopes to do that by the end of the year.
Quotas on textiles and clothing from China are set to expire in 2008. However, preferential trade agreements, which allow some countries to export textiles and clothing to the United States without paying duties, create other opportunities for illegal transshipment, U.S. trade officials said.
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