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Pete A: CNMI retains Headnote consultant
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Posted on Apr 22 2006
The CNMI government continues to get assistance from a consultant in Washington D.C. for the amendment of the Headnote 3(a) of the U.S. Harmonized Tariff Code, said Washington Rep. Pete A. Tenorio.
In an interview after Friday’s State of the Commonwealth Address, Tenorio said that the government has retained the services of the consultant that was hired by the previous administration.
“We still have the consultant,” said Tenorio.
The Babauta administration had hired Sandler, Travis, and Rossenberg to help the CNMI lobby Congress for the tariff amendment, which would help boost the local garment manufacturers’ competitiveness in the world market.
The consulting firm was receiving $15,000 for a month’s work.
This developed as Tenorio expressed confidence that the Headnote3(a) bill would pass Congress within the year.
He said that after a recent public hearing, U.S. Sen. Pete V. Domenici, chairman of the Senate Committee on Energy and Natural Resources, had indicated to him that he would push for the approval of the amendment.
“These are great words of encouragement and, with the assistance of the Governor’s Office, I continue to feel positive that we have a good—although guarded—confidence of seeing this amendment pass this year,” said Tenorio.
The amendment would allow the local manufacturers to reduce the local added value requirement for garment products from 50 percent to 30 percent.
Reducing it to 30 percent would greatly cut Saipan’s costs as this would allow factories the flexibility to cut garment pieces overseas at a lower cost, assemble them on Saipan, and export the end-product to the U.S. duty-free.
Currently, the U.S. Tariff Code requires Saipan manufacturers to have a maximum foreign content of 50 percent to be able to enter the U.S. tax-free. Due to this requirement, apparel manufacturers buy foreign fabric that is then cut, sewn and packaged as final goods in the CNMI.
