Peru Next in Line for Free-Trade Agreement
If all goes according to plan, Peru could be part of the free trade–agreement club by this summer.
That means quotas and tariffs could be removed on most goods flowing between Peru and the United States, including Peruvian apparel made from U.S. or Peruvian textiles.
The free-trade accord agreed upon late last year would replace the Andean Trade Preference Act, which allowed many products, including textiles, to enter the United States duty free. The Andean agreement expires at the end of the year.
The White House notified Congress on Jan. 6 of its intent to sign the Peru agreement within 90 days. After signing, the Bush administration will send it to Congress, which has 90 working days to vote on the matter.
As part of the agreement, a special textile safeguard measure would provide temporary tariff relief if imports to the United States prove to be damaging to domestic producers.
The U.S. government had wanted to include Colombia and Ecuador in the free-trade agreement, but negotiations stalled last year with those two countries. The U.S. Trade representative’s office, which negotiates free-trade agreements, is trying to schedule a new round of talks with them.
Peru’s apparel and textile industry has been hanging on despite fierce competition from China. Peru’s textile and clothing exports jumped 18 percent, or $1 billion, during the first 10 months of 2005 compared with the same period in 2004, according to Peruvian foreign trade association ComexPeru.
Peru is known for the long-staple Pima cotton that it uses to make men’s and women’s blouses, T-shirts, underwear and pants. Almost all of Peru’s apparel exports are cotton clothing. More than half of it goes to the United States. —Deborah Belgum
