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A Stitch in Time: Helping Vulnerable Countries Meet the Challenges of Apparel Quota Elimination

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Abstract:

On January 1, 2005, the United States and other members of the WTO eliminated all quotas limiting the amount of textiles and apparel developing countries can send abroad. Analysts predict that China and a handful of other efficient, low-cost producers will dominate the global market within a few years, shutting smaller, less industrialized countries out of an industry that created millions of jobs and often was the first step in the process of industrialization.

In this new Policy Outlook, Carnegie associate Viji Rangaswami gives detailed prescriptions in four areas: 1) enhanced trade preferences for vulnerable countries; 2) targeted technical assistance to help affected countries improve competitiveness (for example, through infrastructure improvement and customs facilitation); 3) assistance to help countries differentiate their exports in the global marketplace; and 4) assistance to help affected countries manage inevitable dislocations.