Footwear and Travel Goods Sector

An Expert's View about Textiles, Apparel and Accessories in Panama

Posted on: 26 May 2012

The footwear and travel goods sector accounted for over $14 million in U.S. exports to Panama over 2008-10 (average).

The U.S.-Panama Trade Promotion Agreement Opportunities for the U.S. Footwear and Travel Goods Sector The U.S.-Panama Trade Promotion Agreement would provide signicant commercial opportunities for U.S. exporters: • The footwear and travel goods sector accounted for over $14 million in U.S. exports to Panama over 2008-10 (average). • Estimated duties paid on exports of U.S. footwear and travel goods to Panama from 2008 to 2010 were over $4.8 million. • Over 54 percent of U.S. exports of footwear and travel goods to Panama would receive duty-free treatment immediately upon implementation of the U.S.-Panama Trade Promotion Agreement. Footwear and Travel Goods Sector Overview U.S. Footwear and Travel Goods Exports to • The footwear and travel goods sector accounted for over $14 1 Panama Averaged $14 Million million in U.S. exports to Panama over 2008-10 (average). • Top U.S. footwear and travel goods exports to Panama include leather hand bags, rubber shoes, and leather boots and shoes. $16.0 • In 2009, U.S. production of footwear and travel goods was over $15.5 2 $2.4 billion. • The U $15.0.S. footwear and travel goods sector employed over 29,000 3 workers in the United States in 2009. $14.5 $14.0 Improved Market Access for U.S. Footwear and Travel $13.5 Goods Exporters to Panama 2008 2009 2010 • Panama’s footwear and travel goods taris average 11.4 percent, ranging from 0 to 15 percent. 4 • Over 54 percent of U.S. footwear and travel goods exports to Panama would receive duty-free treatment immediately upon implementation of this Agreement. ? ver ? 4? o? U.S. Footwear and • Taris on the remaining 45 percent would be eliminated in 10 years. Travel Goods Exports to Panama Selected Sub-sectors: ? o?l d ? e D?t ? ? Free ? mmediatel? • Footwear: Panama will eliminate taris on 40 percent of U.S. footwear exports immediately upon implementation of the Agreement. Taris on the remaining 60 percent will be eliminated over ten years. Immediate • Travel Goods: Panama will eliminate taris on all U.S. travel goods exports immediately upon implementation of the Agreement. 45.26% 54.74% 10 Years U.S. Footwear Industry Concerns Addressed by the U.S.-Panama Trade Promotion Agreement • U.S. taris on sensitive rubber/fabric and plastic/protective footwear items imported from Panama would be eliminated in ten non-linear annual stages following implementation of the U.S.-Panama TPA. 1 Global Trade Atlas. Calculations by the U.S. Department of Commerce based on import data as reported by Panama. The denition for footwear and travel goods used in this report, unless otherwise cited, is based on HS chapters 42 and 64. 2 U.S. Department of Commerce, U.S. Census Bureau, within NAICS 316. Shipments used as best proxy for production. 3 U.S. Department of Labor, Bureau of Labor Statistics, within NAICS 316 (non-seasonally adjusted). 4 Data based on three-year average for 2008 to 2010. in Million USD • Tari elimination under the non-linear ten-year staging category will proceed with a 3 percent cut in the tari in years one and two, a 5 percent cut in years three through six, an 18 percent cut in years seven and eight, and a 19 percent cut each in years nine and ten. Key States Exporting to Panama • Top U.S. states exporting footwear and travel goods to Panama include: California, Virginia, Wisconsin, Florida, New York, and Ohio. Foreign Competition in Panama’s Market EU Footwear and Travel Goods • Since the conclusion of negotiations with the United States, Exporters Could Immediately Get Panama has concluded separate negotiations with Canada and the EU. The EU-Central America Association Agreement which a 1 Percentage Point Advantage includes Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua in Panama and Panama successfully completed negotiations in May 2010. 12% This agreement will provide the EU with increased regional 10% opportunities in Central America through lower taris, increased 8% government procurement market access and elimination of 6% certain non-tari barriers. Panama also concluded free trade 4% agreement negotiations with Canada in May 2010. As part of 2% this agreement, Panama will eliminate taris immediately on 90 0% percent of Canada’s exports. • EU footwear and travel goods exporters will immediately enjoy EU MFN-If U.S.-Panama Agreement is not enacted an average tari of 10.3 percent upon implementation of the EU- Central America Association Agreement, while U.S. exporters will face an average MFN tari of 11.4 percent until implementation of the U.S.-Panama Trade Promotion Agreement. Other Key Commitments by Panama for the Footwear and Travel Goods Sector Customs Administration: The U.S.-Panama TPA requires measures designed to increase transparency and eciency in administering customs procedures. The Agreement will allow exporters to obtain advance rulings on tari classication, origin of goods, and other customs matters. The Agreement addresses industry’s demand for express delivery services by requiring that, within one year after the date the Agreement takes eect, Panama must provide a separate, expedited customs procedure for express shipments. Rules of Origin: The U.S. Panama TPA rules of origin allow only U.S. and Panamanian originating goods to receive preferential tari treatment under the Agreement. The trade agreement rules of origin provide clear requirements for a good to be considered originating, including that a good must be wholly obtained or produced entirely in the territory of the United States or Panama, as well as requirements for materials that are used in the production of the good. Average Tari May 2011 The International Trade Administration - Your Global Business Partner The International Trade Administration (ITA) – a division of the U.S. Department of Commerce – strengthens the competitiveness of U.S. industry, promotes trade and investment, and ensures fair trade through the rigorous enforcement of our trade laws and agreements. ITA also utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. For more information on exporting to Panama, please contact: • The ITA office of the U.S. Embassy in Panama at enrique.tellez@trade.gov, or 011-507-317-5000, or by visiting our website http://www.export.gov/panama. • You can also locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://www.export.gov/eac. For more information on the U.S.-Panama Trade Promotion Agreement, please visit www.export.gov/fta/panama and www.trade.gov/fta/panama. For more information on industry-specific issues, please visit http://trade.gov/mas/index.asp.
Posted: 26 May 2012

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