Economic meet confirms vital role of apparel industry

At the recently concluded “Planning for the CNMI’s Economic Future” conference, the facilitators and panelists upheld the Saipan Garment Manufacturers Association’s contention that without a strong garment industry continuing to contribute to government revenues, the CNMI is headed for an economic disaster.

During the “Presentation on the Forecasting and Simulation Model of the CNMI Economy, ” and the plenary session entitled “Existing Industry Development Opportunities for the CNMI,” conference economists and consultants outlined the garment industry’s situation and trends.

Outside experts presented the industry’s revenue contributions, showed the growth of other businesses because of the industry and reported that the price of imported goods stayed down because of the garment industry.

Figures were shown that for every garment industry job there are 1.52 other jobs outside the industry created in the CNMI, that the industry contributes $50 million directly to the CNMI coffers each year and that the garment industry now plays a larger economic role than the tourism sector toward government revenue.

In addition, illustrations of the catastrophic effects to the CNMI economy should the garment industry slowly withdraw were given in a “worst case scenario.” This equated to a total job loss of 1,500-2,000 per year (outside of the garment industry) for the next five years, were the industry to leave in 2005.

If the garment industry were to shut down next year for instance, it was theorized that approximately 20,000 other jobs would disappear as well.

The experts reported the problem areas in the garment industry as a dependency on guest workers, control by outsiders, a tarnished image, strained relations with the U.S. and solid waste problems.

The CNMI was encouraged to find ways to reap the benefits of the garment industry within the next three to five years as the industry will phase out of Saipan, instill confidence in the state-side buyers by working on the industry’s image and effectively protect and manage human resources in the industry.

During his presentation to the conference audience, SGMA Executive Director Richard A. Pierce agreed with many of the economic assertions made by the expert economists. Particularly those on revenue contributions, supporting job creation and the “worst case scenario” presented.

Pierce agreed with Governor Tenorio’s assertion that most of these economic realities were outside the CNMI’s control, when he said that “the major affecting factors in the future of our economy arrives from the shores of Japan and the global marketplace for our apparel manufacturing tax and job base.”

Pierce restated the model presented was a purely economic model, not politically or socially persuaded, specifically with respect to the CNMI’s apparel industry and the alien labor issues.

“This is why the CNMI must take all efforts at combating those influences which would federalize wage and immigration laws, counter stateside union activity unknowingly aimed at the CNMI instead of truly foreign countries, and inform the decision makers in the U.S. that our system does self-correct,” Pierce provided.