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Major textile groups disagree on new trade pact

WASHINGTON—Two of the nation's biggest textile groups declared contradictory positions on the Central American Free Trade Agreement on Monday.

Sectors of the declining U.S. textile industry, along with sugar interests, have led the charge against CAFTA, which faces an uncertain reception in Congress this spring. It may approve it, reject it or drop it.

That made the National Council of Textile Organizations' endorsement Monday a coup for the treaty's supporters, including President Bush and the Republican congressional leadership.

"We commend the leading American textile industry organization for having the vision to recognize the benefits of this free trade agreement in responding to competition from Asia," United States Trade Representative Rob Portman said in statement.

But also on Monday, the National Textile Association issued a press release denouncing the treaty and NCTO's decision to support it.

NCTO includes a group of suppliers of yarn and other fabric components whose export businesses are likely to grow if Central America's textile industry grows. U.S. fabric makers, however, would risk more under increased competition from Central America.

"It is astounding that the yarn suppliers and other supplier members on the NCTO board could act with such extreme short-sightedness," said NTA President Karl Spilhaus, whose organization is dominated by weavers, knitters and other fabric-making companies.

"Their support for CAFTA is directly contrary to the interests of their customers, the companies who weave, knit, or finish fabric in the U.S."

The U.S. textile industry exported more than $5 billion in yarns, fabric and component parts to CAFTA's six Central American and Caribbean nations last year, according to NCTO. Those countries—Honduras, Nicaragua, El Salvador, Guatemala, Costa Rica and the Dominican Republic—are not significant markets for finished American textiles.

The U.S. textile industry's division over CAFTA is set against a backdrop of closing plants and scarce jobs. In the past decade, the U.S. textile industry has lost nearly 900,000—or 57 percent—of its jobs, according to the Bureau of Labor Statistics.

NCTO officials said they came to support CAFTA after recent Bush administration promises to cushion the treaty's effect on parts of the industry that seemed bound to suffer under it. One such promise would close a loophole that permitted duty-free imports of clothing from Central America that included pockets made from Chinese fabrics.

But opponents of the treaty aren't impressed.

Safeguards have been promised before, said Jock Nash, a Washington lobbyist for the South Carolina textile firm Milliken & Co.

"Collecting on those promises may be difficult. Members of Congress have been trading hard votes for soft promises for years," he said.

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(c) 2005, Knight Ridder/Tribune Information Services.

GRAPHIC (from KRT Graphics, 202-383-6064): CAFTA TRADE

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