Department of Trade and Industry to meet with US lawmakers on Save Act

MANILA, Philippines - The Department of Trade and Industry (DTI) will be meeting with United States Congressmen and Senators this week in a final bid to pass the Save the Industries Bill before the end of this session.

Trade Undersecretary and concurrent Board of Investments (BOI) Managing Head Cristino L. Panlilio is in Washington to speak with members of both Houses of Congress in order to convince them to pass the bill.

The Save Act is expected to save the ailing Philippine garments industry. Under the Save Act, US-made textile will be sold to the Philippines duty free and then converted into garments for re-export to the United States. This agreement is similar to the agreements with the US to its territories like Guam and Saipan.

“This week is the last session for Congress,” Panlilio said. The US will be holding their midterms elections. “If they pass it this week they will come up with the implementing guidelines and we can have it by second quarter next year.”

Panlilio said that they are confident that they will be able to convince US lawmakers to pass this bill. “The chances are very good. We have convinced many Filipino American community leaders to join us in this crusade and they are talking to their congressmen and senators.”

Among the Filipinos helping the government in this are philanthropist Loida Nicholas Lewis, leading US designer Josie Natori and serial entrepreneur Diosdado Banatao.

Panlilio said his week-long stay in Washington will be dedicated to convincing congressmen and senators that the Philippines is a worthy partner for the Save Act. “The Philippines is a worthy partner for the Save Act.”

Should the Save Act be approved, Panlilio said that the local garments industry will be able to regain lost ground. He said that for four decades until the 90’s, garment was one of the leading exports of the country. He said that in the 70’s garments exported P3 billion worth of goods and employed 600,000 people.

Unfortunately, free trade agreements and the World Trade Organization (WTO) has dulled the local garments industry as the Philippines lost out its competitiveness in garments to Vietnam, Bangladesh, Honduras and Costa Rica.

The SAVE Act Bill, the bill touted to save the ailing Philippine garment industry, is now filed in both Houses of US Congress. The SAVE Act (HR 3039) was introduced by Congressman Jim McDermott and Congressman Brian P. Bilbray in June 2009 which had a total of 10 sponsors. A companion bill S. 3170 was introduced by Senators Kit Bond and Daniel Inouye. 

Under the 809 component of the program, US made fabrics and yarns cut and wholly assembled in the Philippines would qualify to reenter the United States free of duty. In addition, garments made of US spun yarn or extruded yarn formed in the Philippines, may re-enter the United States at 50 percent of the most favored nation (MFN) duty.

The Philippine garments export industry, during its peak, employed around 600,000 workers but was whittled down to 150,000 as cheaper garments are being manufactured from neighboring countries.