Profile of U.S.-Caribbean Apparel Trade

Among the 24 potential CBI member nations, Honduras, the Dominican Republic, and El Salvador together accounted for over 70% of U.S. apparel imports from this region in 1999 (see Figure 1).

The U.S. cotton, apparel, and textile industries appear to be more interested in the CBI legislation than in the SSA legislation, as the United States last year imported 3.4 billion square-meter equivalents of apparel from the Caribbean Basin, compared with only 128 million from sub-Saharan Africa. For every square-meter equivalent of apparel entering the United States from sub-Saharan Africa, the Caribbean Basin sends over 26. 

The highly competitive retail market in the United States has motivated many U.S. apparel firms to begin or expand assembly operations in the Caribbean Basin and Mexico, in order to cut production costs. Both the Caribbean and Mexico offer competitively priced labor for labor-intensive sewing operations, and their proximity to the United States gives firms greater management and quality control over production, lower shipping costs, and shorter turnaround times than with Asian operations.

Mexico and the Caribbean Basin have gradually increased their market share in apparel exports to the United States for several years. Their proximity offers advantages over sourcing from Asia, which has correspondingly lost market share (see Figure 2). In the four years preceding implementation of NAFTA (1990 to 1993), Mexican apparel exports to the United States increased an average of 16.8% annually; in the five years since NAFTA, they have grown 39.2% annually. Similarly, in the four years preceding implementation of TDA 2000 (1996 to 1999), apparel exports from the Caribbean Basin to the United States increased an average of 15.1% per year.