Responding to an announcement by the United States Trade Representative (USTR) Katherine Tai that Vietnam has addressed US concerns in the Vietnam Timber Section 301 investigation, American Apparel & Footwear Association (AAFA) president and CEO Steve Lamar said the organisation is pleased that American apparel, footwear, and accessories imports from Vietnam will not be subjected to additional tariffs.

“At a time when we are focusing on getting more vaccines to this key trade partner and unlock snarled supply chains, removal of this tariff threat is welcome indeed,” Lamar said.

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“We are also pleased to see Vietnam and the US solidify their work to guard against illegal timber harvesting – an important step for Vietnam’s sustainability journey.”

He added: “As the second-largest supplier of apparel, footwear, and travel goods to the US market, Vietnam has experienced dramatic growth since 2016. Additionally, Vietnam has become an important supplier of personal protective equipment (PPE).”

“All tariff relief and removal of tariff threats is good trade policy, as taxing Americans to get dressed each day is never a good negotiating tactic.”

A statement from the office of the USTR on Friday (1 October) said Tai has announced an agreement with the Socialist Republic of Vietnam that addresses US concerns in the Section 301 investigation.

“The Agreement secures commitments that will help keep illegally harvested or traded timber out of the supply chain and protect the environment and natural resources,” it noted. “Ambassador Tai determined that the Agreement provides a satisfactory resolution of the matter subject to investigation and that no trade action is warranted at this time. Going forward, the Office of the USTR will monitor Vietnam’s implementation of the Agreement.”

Tai said: “I commend Vietnam for its commitment to address our concerns regarding the importation and use of timber that is illegally harvested or traded. With this Agreement, Vietnam will provide a model – both for the Indo-Pacific region and globally – for comprehensive enforcement against illegal timber. USTR looks forward to working with Vietnam to deepen collaboration and information exchange, including through a newly created Timber Working Group.”

 

The Agreement contains multiple commitments by Vietnam on issues related to illegal timber, including commitments to improve its Timber Legality Assurance System; keep confiscated timber (i.e., timber seized for violating domestic or international law) out of the commercial supply chain; verify the legality of domestically harvested timber regardless of export destination; and work with high-risk source countries to improve customs enforcement at the border and law enforcement collaboration, the USTR statement noted.

“Illegal timber in the supply chain damages the global environment and the natural resources on which we all depend, and is unfair to US workers and businesses who avoid such timber,” Tai added.

She said: “USTR’s first use of Section 301 in this investigation shows the strength of using this tool to address concerns regarding environmental risks or the enforcement of environmental laws.”

The USTR investigation was initiated in October 2020 under Section 301 of the Trade Act of 1974.

AAFA has continuously pressed the Biden administration for additional Section 301 tariff exclusions and retroactive renewal of all expired exclusions. Last week, AAFA penned a letter to Katherine Tai on this issue and the simultaneous shipping crisis causing “out-of-control” freight rates, historic log-jams at ports, delays, and costs that are wreaking havoc on supply chains and America’s economic recovery.

AAFA has also been continuously pushing for vaccine access to trade partners in Vietnam, and other key supplier countries, as well as longer-term exclusions of tariffs on critical PPE.

It recently applauded Biden’s promise to double US donation of Covid-19 vaccines and calls for support of hard-hit Vietnam and Bangladesh.