Under Secretary of Commerce For International Trade Francisco SÁnchez
NEI and Sourcing in the Americas Seminar
Monday, August 22, 2011
Las Vegas, Nevada
As prepared for delivery
Thank you, Julie, and good morning everyone. It’s great to see all of you here at this early hour … especially in Las Vegas.
I’d like to begin by thanking our hosts at MAGIC who joined with Commerce’s International Trade Administration, or ITA, to create the first Sourcing in the Americas Pavilion and Summit.
I’d also like to thank our guest speakers today, who will be sharing their stories on doing business in the Americas.
And I want to offer a special welcome to our friends and long-standing trading partners from South and Central America and the Caribbean. Our work together has been a tremendous success, and is proof of the power of partnerships. That power is also evident today at this inaugural event.
We’ve been planning this two-day Summit since last year, when representatives of the U.S. textile industry and an association that represents brands and retailers approached ITA to do an event focused on sourcing textiles and apparel in the Americas at MAGIC.
Despite their diversity of interests, they recognized that this initiative advances shared goals and interests.
On one hand, the industry is continuously seeking ways to increase its exports of yarns and fabrics along its supply chain. On the other, brands and retailers are seeking options closer to home for sourcing.
That’s why we thought this event was a great idea on a couple of levels.
First, President Obama and this Administration are committed to a new era of regional engagement and cooperation. And,
Second, Commerce, and ITA in particular, has a leading role in supporting the President’s National Export Initiative goal of doubling U.S. exports by 2014 to support millions of jobs here at home.
The NEI is a full-court press, government-wide effort, with a focus on:
- Improving trade advocacy and export promotion efforts;
- Increasing access to credit, especially for small and medium-sized businesses;
- Removing barriers to the sale of U.S. goods and services abroad;
- Robustly enforcing trade rules; and
- Pursuing policies at the global level to promote strong, sustainable, and balanced growth.
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.
Some 2.4 million private sector jobs have been created over the past 17 months, despite a slowdown in economic growth from substantial headwinds in the first half of the year.
But too many people in our nation are still hurting. There’s too much uncertainty and too many people still looking for work. As the President said, we have more work to do.
That’s why this administration is making unprecedented efforts to facilitate trade and help U.S. companies find commercial partners beyond our borders.
We’re already off to a good start. Exports have been a key driver of America's 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 14.0 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 NEI has helped spur this progress.
But 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.
This is why we were so pleased to work with MAGIC and industry to put this Americas sourcing forum together.
It’s an opportunity to not only highlight this important supply chain, but also to encourage brands and retailers to continue to look at the Americas as a sourcing option with a view to further strengthening our commercial and regional links.
Status of U.S. Industry
While technology and global competition have gained momentum over 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.
Textile and apparel trade is also 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 the Americas are the largest market for U.S. textile and apparel export goods -- representing 64 percent of our exports to the world, totaling nearly $13 billion.
Exports of U.S. textile and apparel goods to the Americas region continued last year to rebound from the global economic downturn – growing by nearly 20 percent in 2010 over 2009. Exports to the CAFTA-DR region grew by 30 percent during the same time period.
And based on data from the first quarter of 2011, it appears that the growth in regional trade we saw in 2010 is continuing.
U.S. imports of textiles and apparel from the Western Hemisphere increased 12 percent during the first quarter of 2011 over the same quarter in 2010, while exports increased by 21 percent.
And recent studies show that typical cost differences have narrowed measurably this year.
Sourcing has become more cost competitive in the region as we’ve seen increased raw material prices, rising labor costs in Asia, higher productivity in the Americas and duty-free access to the U.S. market under free trade agreements.
Sourcing in the Americas also offers speed-to-market, which allows for inventory reduction and other supply chain efficiencies.
In an intensely competitive world, where ‘time-is-money,’ and the demand for shorter lead times and reliability will only increase, creating a greater demand for regional sourcing options in the future.
Which makes this forum especially timely.
Participants in the Americas Sourcing Pavilion – which I strongly encourage you to visit – include more than 75 textile and apparel companies from the U.S. and our free trade agreement and trade preference country partners, and they all appear eager to meet new sourcing demands.
At the Pavilion, you can also see a demonstration of the new online textile and apparel sourcing database and directory for the CAFTA-DR region. This is being launched by our colleagues in the office of the U.S. Trade Representative and the Inter-American Development Bank.
I’ll close with this: We think there is tremendous potential for the textile and apparel industries in the Western Hemisphere to be doing more business together.
The benefits are threefold: Partnering in regional production enhances comparative advantages, Western Hemispheric competitiveness and the economic prospects of the company and its workforce.
At the International Trade Administration, our mission is to work with U.S. businesses seeking regional and global partners. We think of it as match-making for exporters.
We have trade specialists in over 100 cities across the United States and commercial service officers in 77 countries around the world. And we have people from our Office of Textiles and Apparel here today who’d be happy to answer your export-related questions.
We see more Hemispheric trade as a win-win, helping to make our region stronger and our people more prosperous. I’m sure you see this too. So, let’s work together to make this vision a reality.
This summit is an important start — but it’s only the beginning. Our work is not over once we exit these doors. ITA wants to work with you — tomorrow and into the future — to build on the work we’ve done these past two days; to seize the enormous opportunities in the global marketplaces; to support your businesses; and to strengthen the US economy so that it paves new paths to prosperity for all.
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