US Trade Lapse on Haitian Textiles Undermines Security Efforts
In a move that highlights a profound disconnect between security initiatives and economic stability, the United States allowed a critical trade preference for Haitian textiles to expire, mere hours after spearheading a United Nations resolution for an international "gang suppression force" to stabilize the embattled Caribbean nation. This lapse in a two-decade-old law, which permitted Haitian textiles to enter the U.S. duty-free, occurred amidst a government shutdown in Washington, creating immediate and severe repercussions for Haiti's most reliable industry.
The textile sector stands as one of Haiti's few functioning and stable industries, serving as an indispensable source of revenue and employment. According to Maulik Radia, president of the Haiti Industrial Association, it directly employs over 24,800 people, with exports to the U.S. reaching $538 million in the 12 months leading up to July. Without the tariff-free arrangement, these companies face an existential threat, as their products will now be subject to U.S. duties ranging from 14% to 30%, in addition to a standard 10% reciprocal tariff.
The implications of this economic blow extend far beyond mere business losses, directly impacting Haiti's dire security situation. Radia warned that the impending job losses will create "fertile ground for gangs to recruit more people." This comes at a time when Haiti, the poorest nation in the Americas, is grappling with rampant gang violence that has intensified significantly since the 2021 assassination of President Jovenel Moise. Gangs currently control an estimated 90% of the capital, Port-au-Prince, and the United Nations reported over 3,000 murders this year alone, underscoring the urgent need for stability rather than further destabilization.
The expired legislation, known as the Haitian Hemispheric Opportunity Through Partnership Encouragement Act (HOPE), was originally established in 2006 and amended in 2008. Historically, these trade preferences have enjoyed consistent extensions with broad bipartisan support and minimal controversy, including a ten-year renewal by Congress in 2015. However, this time, the efforts of lobbying groups, such as the American Apparel and Footwear Association (AAFA), which had worked for two years to secure an extension and hoped for a last-minute continuing resolution, were ultimately stymied by Washington's political gridlock.
Following the expiration, the AAFA promptly urged lawmakers for retroactive approval of a new deal. Beth Hughes, the organization's vice president of trade and customs, expressed profound disappointment, stating, "Despite persistent and constructive engagement from a wide range of stakeholders, Congress has fallen short in renewing these mutually beneficial programs, ultimately surrendering further strength to China’s manufacturing influence by placing unnecessary obstacles in the way of viable sourcing alternatives." Radia further highlighted the lack of economic rationale for letting the deal lapse, noting that the U.S. maintains a $437 million trade surplus with Haiti, which is also a significant importer of U.S. rice, and its textile industry largely relies on U.S. cotton.
The irony of the situation is not lost on industry leaders. Just five years ago, Haiti’s textile sector employed over 60,000 individuals, and there were aspirations that the Trump administration's emphasis on near-shoring industries might provide a boost. Instead, the current expiration is expected to displace these jobs, pushing them towards the "Far East and Asia," as Radia pointed out. This outcome not only undermines the U.S.'s own stated economic priorities but also tragically exacerbates the very instability that its diplomatic efforts, like the recent UN security resolution, are purportedly designed to combat.
