With the lifting of quota restrictions on apparel entering the United States now in effect, Saipan\u2019s garment sector leaders met with the Babauta administration this week to hammer out a plan to keep the industry\u2019s viability amid tougher international competition.<\/p>\n
Industry officials met with Gov. Juan N. Babauta and other administration officials on the possible fate that awaits the CNMI\u2019s garment sector\u2014the biggest contributor to the government\u2019s revenue\u2014with the new World Trade Organization setup.
\nSaipan Garment Manufacturers Association executive director Richard Pierce said that the Babauta administration pledged to enhance the local apparel industry\u2019s competitiveness, as world players await possible restrictions on Chinese exports to the United States.<\/p>\n
Local industry players, like domestic U.S. players and foreign countries, fear that China would further dominate the U.S. market\u2014the world\u2019s largest market for apparel\u2014with the lifting of quota restrictions. With its cheap labor cost, China produces apparel at substantially lower cost than other countries and territories, including the CNMI.<\/p>\n
\u201cWe can always get our goods to America, but we just don\u2019t know if we can meet other countries\u2019 price offers. Our selling prices have dropped 20 percent in the past four years, and we expect that the U.S. consumer will expect another 5-10 percent drop within a year. Without \u2018reworking\u2019 our tariff formula, there\u2019s really no other way to get our prices down, barring paying less salary or eliminating local taxation, which is something no one really wants to think about,\u201d Pierce said.<\/p>\n
\u201cPrice advantage and the ability to compete brought us to Saipan, and it is the inability to compete in pricing that will slowly move the industry elsewhere,\u201d he added.<\/p>\n
Pierce said the SGMA board led by its chairman, James C. Lin, met with Babauta, attorney general Pamela Brown, governor\u2019s legal counsel Steven Newman, and other administration officials last Monday and Tuesday.<\/p>\n
Part of the discussions include the garment industry\u2019s request in seeking amendment to the U.S. Tariff Code and local labor regulations, as well as assistance in addressing retail shops on Saipan selling stolen goods from Saipan factories.<\/p>\n
Saipan\u2019s garment industry wants a congressional amendment to the U.S. Tariff Code so that garment products coming from the insular areas such as the Commonwealth could enter the United States duty-free.<\/p>\n
SGMA also wants the federal government to grant petitions that would limit China\u2019s growth rate to 7.5 percent annually. It lauded the federal government\u2019s move to extend by 30 days the imposition of certain restriction on China\u2019s garment exports in January 2005, giving more time until the petitions are decided.<\/p>\n
\u201cIt\u2019s paradoxical, even ironic, how things are working out for us in our quest for industry survival here in the CNMI,\u201d Pierce said. \u201cWe are a part of the United States of America, yet we are competing with foreign countries for a \u2018market share\u2019 of American consumer purchases in apparel, when, as foreign countries, their access to the U.S. marketplace, through their new quota and tariff treatment, now threatens our existence as a business in one of America\u2019s insular areas.\u201d<\/p>\n
For instance, new trade partnerships between the United States and Egypt, which allow U.S. companies to import apparel products from the latter\u2019s industrial zones, gives more reason for the federal government to reduce the value-added requirement for apparel coming from the insular areas, including the CNMI, the SGMA earlier said.<\/p>\n
The new qualified industrial zones in Egypt are authorized by an extension to the U.S.\/Israel Free Trade Agreement, which provides duty free access to products made in QIZs subject to certain requirements, including a rule that the goods undergo substantial transformation in the QIZ and that they satisfy a 35 percent minimum value requirement, including the use of Israeli content.<\/p>\n
Under the Egyptian QIZ program, goods manufactured in designated industrial zones in Egypt, which utilize Israeli inputs, will receive duty-free treatment when exported into the United States. Designated QIZs include those in Greater Cairo, Alexandria, and Suez Canal Zone.<\/p>\n
A similar trade partnership with Jordan has reportedly been in existence since 1998.<\/p>\n","protected":false},"excerpt":{"rendered":"
With the lifting of quota restrictions on apparel entering the United States now in effect, Saipan\u2019s garment sector leaders met with the Babauta administration this week to hammer out a plan to keep the industry\u2019s viability amid tougher international competition.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-86955","post","type-post","status-publish","format-standard","hentry","category-local-news"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/86955","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=86955"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/86955\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=86955"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=86955"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=86955"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}