The National Council of Textile Organizations (NCTO) has expressed serious concern regarding a proposed ‘textile mechanism’ outlined in the Office of the US Trade Representative’s (USTR) recent Section 301 forced-labor findings. While the USTR implemented 10 per cent to 12.5 per cent ad valorem tariffs across 60 economies to penalize forced-labor compliance gaps, the agency proposed allowing overseas apparel manufacturers to enter imports at reduced Section 301 rates if they purchase US-made yarns or fabrics. Domestic textile producers argue that allowing conditional tariff relief creates enforcement loopholes that could enable third-country circumvention for goods incorporating illicit inputs.

Enforcement vulnerabilities in global apparel supply chains

According to federal findings, over 92 per cent of China's cotton originates from Xinjiang, where forced labor risks remain prevalent. American textile manufacturers argue, duty reduction schemes undermine existing protections, including the Uyghur Forced Labor Prevention Act (UFLPA). Kim Glas, President and CEO, NCTO, states, a duty-mitigation mechanism risks opening backdoor avenues for non-compliant foreign apparel while diluting the structural impact of Section 301 tariffs on unfair trade practices. The sector urges strict enforcement without preferential offsets to protect domestic spinning and weaving assets.

Advocating supply-chain transparency across manufacturing hubs

The National Council of Textile Organizations represents the full spectrum of the US textile sector, from raw fibers to technical fabrics. Operating in a market with over $65 billion in annual output, the association advocates for trade policy enforcement and supply-chain transparency across domestic and Western Hemisphere manufacturing nodes.