Under Secretary of Commerce For International Trade Francisco SÁnchez
New Western Hemisphere Supply Chain - Way Beyond the Basics
Sunday, August 21, 2011
Las Vegas, Nevada
As prepared for delivery
Thank you, Kim. Good afternoon everyone. It’s great to see all of you here at MAGIC’s first “Sourcing in the Americas Summit.”
I had the pleasure of walking around earlier, and took a look at many of the exhibits— in fact, there are more than 70 companies represented here today. And, I must tell you, I felt an incredible amount of excitement and energy in the room. That’s because we all see the possibilities that this new event will lead to new partnerships, new ideas, new markets for your products, and new opportunities for success.
That’s why, on behalf of:
- The Commerce Department and our International Trade Administration’s Office of Textiles and Apparel;
- The National Council of Textile Organizations; and The U.S. Association of Importers of Textiles and Apparel
It’s my pleasure to welcome you, as we identify ways to work together to build stronger economic partnerships that benefit us all.
First, I want to thank all those who made this possible, starting with our hosts at MAGIC who joined with Commerce’s International Trade Administration, or ITA, to create this landmark event.
I’d also like to recognize the textile and apparel regional organizations that are supporting the Americas Sourcing Summit and Pavilion.Their work was critical to this event’s success.
I also want to thank the Cotton Board for funding the Pavilion Resource Guide you received as you entered. Information is perhaps the most powerful tool for success, and this guide will serve as an important resource for you in the future.
Finally, I want to extend a warm welcome to our friends and trading partners from Central America, Mexico, Peru, Haiti, the Dominican Republic, and Colombia.
I know that many of us here look forward to participating in the Americas Competitiveness Forum which is being held in the Dominican Republic this October – and in Colombia in 2012.
What that event will represent — like this gathering represents today — is the recognition that today’s global challenges require global solutions. In other words, all of us are going to have to work together — across city lines, state lines, boarders and oceans — to position ourselves for success in the 21st century economy. We’ve got to be in constant search of fresh ideas, opportunities and partnerships.
Recognizing this, industry leaders approached us to host the first “Americas Sourcing Summit and Pavilion.” MAGIC is the preeminent trade event in the international fashion industry. It attracts people in the textile, apparel, and footwear trade from all over the world.
So we saw the staging of this Americas event as a great way to highlight sourcing opportunities in the U.S. and the Western Hemisphere, and to develop new commercial partnerships.
And I’m pleased to see all the domestic manufactures of yarns and fabrics, foreign manufacturers of apparel, and global retailers, who import finished products, with us today.
You’re in the right place at the right time.
In his State of the Union last year, President Obama announced his National Export Initiative, or NEI, which mobilizes departments throughout the federal government to double U.S. exports by the end of 2014, in support of several million new jobs.
The logic behind the NEI is simple: The more goods and services U.S. businesses export, the more they need to produce. And the more businesses produce, the more workers they need. And that means jobs.
When President Obama first took office, he made some tough decisions that pulled the U.S. economy back from the brink. Today, there is good news out there. The economy has created more than 2.4 million jobs in the last year and a half. We’re seeing a comeback in manufacturing and new strength in the clean energy sector. Household debt is back to where it was before the bubble of the 2000s, consumer spending is starting to rise and corporations are making record profits.
Exports have been a key driver of America's ongoing economic recovery.
In 2010, U.S. exports of goods and services totaled $1.84 trillion, an increase of nearly 17 percent over 2009 levels.
And exports have been growing at a strong pace overall this year.
In the second quarter of 2011, exports accounted for 14 percent of all U.S. economic output, which is the biggest portion of our economy since the Commerce Department began tracking quarterly figures in 1947.
The Americas are the largest market for U.S. textile and apparel export goods. In total, the region represents 64 percent of U.S. textile and apparel exports to the world.
In 2010, the U.S. exported nearly $13 billion worth of textile and apparel goods to the Americas. And there’s still plenty of room to grow. And one thing our partners in the Western Hemisphere are keenly aware of is that trade is NOT a zero sum game. Benefits flow both ways.
U.S. domestic yarn spinners and fabrics manufacturers produce quality goods, and they are here because they are eager to develop new commercial partnerships in the Americas.
At the same time, importers, brand representatives and retailers who are participating will be able to revisit the opportunities in the region, allowing for more sourcing options.
State of U.S. Industry
While technology and global competition have gained momentum throughout the years, forcing U.S. textile and apparel enterprises through profound transformations, the industry remains a critical part of our national workforce and economy.
The U.S. textile industry is one of the largest manufacturing employers in the United States, employing nearly 600,000 workers sector-wide, with shipments totaling more than $50 billion last year. And it is the anchor of many rural economies, especially in rural and small towns throughout the Southeast.
A key focus of these textile manufacturing companies is on expanding commercial relationships with our neighbors to the north and the south, whose markets offer tremendous, mutually beneficial opportunities.
The textile and apparel trade is extremely important to many of the countries in the Western Hemisphere, especially Central America and the Caribbean. In Nicaragua, for example, 51 percent of their exports to the U.S. are apparel. And as I said The Americas are the largest market for U.S. textile and apparel.
Much of the U.S. textile exports to the region, especially to Mexico and CAFTA-DR, are converted into apparel that is shipped to the U.S. duty-free under the benefits created by our free trade agreements with those countries.
That regional integration encourages us to continue to work closely with those trading partners to maintain and increase the textile and apparel trade flow.
And, in fact, regional cooperation is one of the biggest motivating factors for getting our textile and apparel manufacturers, importers, and retailers together here this week.
Not surprisingly, regional trade in textiles and apparel was negatively impacted by the end of global textile quotas in 2005 and the economic contraction that hit in 2008.
However, U.S. textile and apparel trade with the Western Hemisphere rebounded in 2010, with imports growing by 11 percent and exports growing by 20 percent.
We’ve been told by various firms that orders are coming back to the region. Quality, reliability, speed-to-market, tariff benefits, and cost structure play an important role.
And in the near future, there may be opportunities for manufacturing of certain textile and apparel products that have traditionally been manufactured in other parts of the world.
In short, the textile trade in the Americas region has a strong foundation. And we believe it is well positioned to grow.
This event is intended to help make that happen.
First, it brings together the region’s buyers and suppliers of textile products in one forum to establish business relationships, discuss future opportunities and buy and sell goods.
Second, the strong representation of manufacturers and retailers here will generate discussions about the possibilities, as well as the challenges involved with sourcing from the region.
For example, the World Bank reports that it takes an average of 20 days for goods to be imported into Latin America at a cost of nearly $1,500 per container.
Third, our colleagues at the office of the U.S. Trade Representative and the Inter-American Development Bank (IADB) are unveiling a new online sourcing database and directory for the CAFTA-DR region.
This will be a user-friendly, comprehensive directory of companies offering products in the textile and apparel supply chain.
It’s a terrific project. And we hope to see the directory expand to cover other countries in the region or other industries.
You can see a demonstration of the database in the Sourcing Pavilion.
I’ll close with this: We saw a dramatic demonstration of our interdependence with the fallout from the world financial crisis, starting in 2008. I know many people in this room still bear the scars of that downturn.
And even today, as we work to maintain the momentum of the global economic recovery, we witness almost daily how the fluctuations in one market can spill into the next.
But expanding and strengthening trade in this region and in this sector can take advantage of our integration for the good of our nations – creating economic growth and new jobs. The Obama administration is committed to a new era of regional engagement and cooperation. Our vision for the region is one of growth and prosperity for all, a vision where the benefits of trade are shared on all sides.
That’s why we are here at MAGIC and why we are proud to be co-hosting the Sourcing in the Americas Pavilion and Summit.
Thank you again for joining us today.
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