California Apparel News

The Obama administration wants the Los Angeles apparel and textile industry to help the country double its exports by the end of 2014.

Deputy U.S. Trade Representative Demetrios Marantis made his first trip to Los Angeles as a member of the Obama administration, visiting key apparel and textile factories on April 2 and then holding a round-table with about 30 apparel and textile executives to urge them to take advantage of the various free-trade agreements negotiated by the U.S. government.

“The whole point of my being here is to talk to the industry about how to take advantage of the ‘Made in USA’ label and how do we use our trade agreements to help the industry export,” said Marantis, who was named deputy U.S. trade representative in 2009. He has been active in negotiating the Trans-Pacific Partnership, a regional trade agreement between the United States and eight other countries—Vietnam, Brunei, Malaysia, Australia, Chile, New Zealand, Peru and Singapore. 

This was Marantis’ first trip to Los Angeles in his role as a trade negotiator. He toured the facilities of Karen Kane, a well-known womenswear maker, as well as denim sewing contractor New Fashion and the wash and dye house Blue River Denim Inc. 

He then met with industry executives at the offices of the nonprofit Fashion Business Inc. to encourage Los Angeles’ apparel makers to take advantage of the fast-growing markets of Asia.

For example, Vietnam has a population of 90 million people, and most of them are under the age of 30. “Our mission in life [at the Office of the U.S. Trade Representative] is to grow exports that support new jobs,” Marantis said.

He noted that the recently enacted free-trade agreement with South Korea means that U.S. exports will be boosted by $10 billion to $11 billion a year. With that free-trade agreement, apparel exports to South Korea are no longer subject to an average 13 percent tariff. 

“The role of the industry here is producing high-fashion, high-style items. There is not only a market here, but 95 percent of the world’s consumers live abroad. There is a market [for California fashion] in Singapore, Malaysia and South Korea,” he said.

Marantis spoke to industry leaders including Lonnie Kane, president of Karen Kane; Bryan Kang, president of Rhapsody Clothing Inc.; Rob Greenspan, head of Greenspan Consult Inc.; Ken Wengrod of FTC Commercial; Ilse Metchek, president of the California Fashion Association; Frances Harder, founder of business incubator Fashion Business Inc.; and Joe Rodriguez, executive director of the Garment Contractors Association of Southern California.

Accompanying the trade ambassador was Gail Strickler, the assistant U.S. trade representative for textiles and apparel.

Many were pleased that two high-ranking officials from the Obama administration made the trip to Los Angeles. “In all the trade agreements that have been negotiated, this is the first time someone in the trade representative’s office has come to Los Angeles to discuss what we think,” Kane said.

But some were concerned that it was overly optimistic that the local apparel industry would start employing large amounts of people to make clothing for export.

Rodriguez said two things had to be done for that to happen: The U.S. government needs to find some way to grant visas to the hundreds of illegal apparel sewing workers who populate many of the sewing contractors in town and the United States needs to raise apparel tariffs to protect the industry.

Rhapsody Clothing's Kang also felt something had to be done to accommodate the legions of illegal sewers working here. He used to make all his clothing in Los Angeles. Then three years ago, he moved everything offshore. Last October, he brought 5 percent of his production back to Los Angeles to have that “Made in USA” label for some retailers. “The true reality is that without the [illegal] sewing workers, we cannot cut and sew,” he said. “I wish I could do more here, but there is not enough capacity in Los Angeles.”

Marantis said negotiations are still ongoing for the Trans-Pacific Partnership, which could be wrapped up by the end of this year and sent to Congress next year. It creates huge opportunity for U.S. apparel exporters, he said, even though it has a yarn-forward provision. 

There are ways of getting around the yarn-forward provision by making a short-supply request for yarns not produced in the region. Those requests can take as little as 45 days to enact, Strickler said.

Many Los Angeles apparel makers weren’t aware of the short-supply-request provision, which opens up the possibility of qualifying apparel for a duty-free classification.—Deborah Belgum