Mainland textiles in for boost as quotas go
Illegal shipments of Chinese garments worth millions of dollars to the US via third countries will cease after textile quotas are lifted in January, a senior American customs official said yesterday.
But for other Chinese goods affected by US anti-dumping actions or other trade barriers, illegal transshipments to the US via third countries would continue, said Janet Labuda, director of textile enforcement at US Customs and Border Protection.
The US Customs Service seized more than US$200 million of textiles smuggled into the US last year, including $130 million with fake documentation, said Ms Labuda.
'It's my opinion that 100 per cent of the (textiles) with fake documentation were of Chinese origin.'
About 28 per cent of clothing shipped to the US from Asia last year was labelled with the wrong country of origin, US officials were earlier reported saying.
'We're aware of Chinese apparel companies making illegal transshipment of goods to the US via Vietnam,' said Steven Feniger, chief executive of Linmark Group, a Hong Kong trading company. 'Unscrupulous manufacturers would send containers of goods made in China to sit in docks in Vietnam, with the label 'made in Vietnam'.'
Linmark hired hundreds of people to inspect and audit manufacturers and the supply chain in Asia, said Mr Feniger: 'We guarantee for our customers that illegal transshipments don't happen with us, but we know it happens for other companies.'
Last month, the US reduced its garment quota allotted to Vietnam by 4.5 per cent, or US$80 million, because of the high proportion of illegally mislabelled Chinese garments transshipped through the country, said James Leonard, deputy assistant secretary of the US Department of Commerce.
'Some US manufacturers were unhappy because they wanted a 30 per cent cutback on Vietnamese quotas, but some US retailers didn't want any cutback. We did a good job because we got everyone mad at us,' Mr Leonard said.
Ms Labuda said: 'A lot of enforcement [against illegal transshipments of textiles] would go by the wayside as quotas go as well.'
Mr Leonard said: 'When quotas go away, it won't matter what country a product comes from. However, if there are safeguard quotas put in place on certain Chinese apparel goods, there could still be an incentive for China to transship these goods via third countries. We are working with customs to deal with that.'
Despite the lifting of quotas next year, the US is entitled to impose one-year quotas on certain hot-selling Chinese garments under a safeguard mechanism.
All products will still be subject to penalty tariffs if US authorities find they are being dumped on the market at below fair value.
In recent weeks the US has declared that Chinese manufacturers were dumping televisions, metal-top ironing boards and wooden bedroom furniture.
'I believe there will be illegal transshipments of Chinese goods affected by US anti-dumping action, and I don't expect that to stop. We have seized quite a number of times a number of products smuggled into the US with fake documentation that were under US dumping action,' said Ms Labuda.
