#1 Why or why not do you think the used clothing import ban truly can help East African countries better develop their local textile and apparel industry? (please provide detailed examples, if possible)
#2 If U.S. citizens donate clothing to local charity organizations and second-hand clothing stores, in hopes to better the community, why are these organizations exporting the clothes overseas?
#3 Used clothing imports were seen as a threat to the EAC but were also viewed as having a positive environmental impact because the clothes were being up-cycled and recycled. Do you think if there was more emphasis put on the benefits of importing used clothes, due to its positive environmental effect, that the EAC would put more thought into their decisions to ban all used apparel imports?
#4 Notably, almost none of the used clothing exported from the United States to EAC countries are actually “Made in the USA”—they were originally imported from Asian countries such as China, Vietnam, and Bangladesh. Also, most U.S. used clothing exports to EAC were “free giveaways” by U.S. consumers. Is it ethical for SMART to oppose the used clothing import ban so that its own can make a profit? What is your evaluation?
#5 Why or why not do you agree with U.S. government’s response to the EAC import ban on used clothing? What could be done differently and why?
#6 Given the debate on used clothing trade and its impact on East African nations, will you continue to donate used clothing? Why or why not?
[For FASH455: 1) Please mention the question number in your comments; 2) Please address at least TWO questions in your comments]
U.S. fashion brands and retailers are deeply concerned about the negative impacts of the tariff war on their businesses. According to the 2019 U.S. Fashion Industry Benchmarking Study released by the U.S. Fashion Industry Association, even without considering the upcoming 10-15% tariffs to be imposed on around $35.7 billion Chinese textiles and apparel covered by tranche 4:
The trade diversion effect of Section 301 has accelerated U.S. fashion companies’ pace of reducing sourcing from China. About 83 percent of respondents expect to decrease sourcing from China over the next two years, up further from 67 percent in 2018.
The Section 301 action is pushing up the price of U.S. apparel imports across the board, making “increasing production and sourcing cost” the top business challenge for respondents in 2019. As much as 63 percent of respondents explicitly say the U.S. Section 301 tariff action against China “increased my companies’ sourcing cost” in 2019. As companies are moving sourcing orders to Bangladesh, Vietnam, and India, the average price of U.S. apparel imports from these countries – the main alternatives to China — have all gone up very quickly.
No evidence shows that Section 301 has benefited near-sourcing from the Western Hemisphere and reshoring from the United States significantly. Instead, respondents say Section 301 has increased the production costs of textiles and apparel “Made in the USA.”
Respondents say they are reluctant but may have to increase their retail prices, should the U.S.-China tariff war escalate further.
As described in the video, transshipment is one form of illegal import activities and occurs when false country-of-origin information is provided for imported goods in order to evade U.S. customs duties. Transshipment was a major issue in textile and apparel trade back in days when the quota system was still in place.
According to the media, because of the escalating U.S.-China tariff war, customs fraud such as transshipment is thriving again. Some fashion companies are also using tariff engineering to avoid paying the punitive tariffs in a legal way. Indeed, how to label “Made in ___” can be much more complicated, technical and subtle than we realize.