Mexican textiles re-exported to US tariff-free

Applying the "country of origin" clause, clothing made in Central America from Mexican textiles will not be subject to U.S. import duties.

Tuesday, June 17, 2008

The measure, negotiated in 2003, allows U.S. imports of up to 100 million cubic meters per year of clothing made in Central America with Mexican textiles, under the country of origin clause.
Of the 100 million cubic meters, 45 million can be pants and skirts made of cotton or synthetic materials, 20 million of blue denim, a million woolen jackets, suits and skirts, and 34 million garments classified as "other."
As a reciprocal measure, Mexico will import 70 million cubic meters of textiles from the United States.



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Nicaraguan Textiles Lead in Central America

July 2011

Between January and May sales grew by 25% compared to the same period in 2010.

The rise in sales to the U.S. was higher than to countries like El Salvador, Honduras and Guatemala, which increased by 19%, 17% and 13% respectively in the same period.

With the 25% increase, Nicaraguan exports went up from $381.1 million to $476.7 million.

Tariff Preferences for Textiles At Risk

April 2013

The preferential system which allows Nicaraguan textiles made with raw materials from countries outside of the DR-CAFTA to enter the U.S. without tariffs will expire at the end of 2014.

"... By the end of next year the nine-year grace period given by the United States to Nicaragua will expire, a benefit known as tariff preference level (TPL) which allows the country to export clothing made from yarn and fabrics from third countries for a maximum annual volume of one hundred million square meters." noted an article in Laprensa.com.ni.

Free Trade spurs sales of Accesorios Textiles S.A.

June 2008

Accesorios Textiles S.A. invested 1.5 million dollars to provide labos to manufacturers of garments sold in the United States under the free trade agreement.

This Guatemala company is an example of the multiplier effect of free trade. Since the middle of 2006, when the agreement went into effect, it has invested more than 1.5 million dollars to buy machinery, expand facilities, and hire personnel to diversify its production.

Nicaragua and DR-CAFTA

April 2011

Nicaragua is one of the countries which has benefited the most from the Free Trade Agreement.

Robert Callahan, U.S. Ambassador in Nicaragua, added that the Central American country currently has a positive trade balance of $1.078 with the U.S.

Additionally, exports to the North American country have increased 71% in the past five years, from $1.170 million in 2005 to $2.012 million in 2010.

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