Saipan factories report gains

The Saipan Garment Manufacturers Association reported consecutive months of increased sales in Saipan factories as fall and winter orders arrived, and as predicted, Asian countries exhausted their annual quota allocations from the U.S. government.

CNMI Customs Service provided figures for the month of July represented slightly over $80 million in sales, after June’s $72 million in goods shipped to the U.S. marketplace.

To the CNMI Finance Department, this yielded $5,648,966. collected user fee payments for the two months. User fees collected so far in FY 2004 are at $25,141,474, a 3.5 percent increase for the first 10 months of FY 2003.

SGMA spokesman Richard A. Pierce attributed the spike in sales to expected seasonal activity.

“Traditionally, orders for the fall and winter holidays are shipped beginning now, and these goods are always higher priced. And, except for last year, sales always pick up at the end of the calendar year as Asian countries expend their valuable quota for goods shipped to U.S. department stores,” he said.

“The increase in sales and revenue to the CNMI, and we expect this slight surge for the remainder of the year, should only be interpreted with the full understanding that we will not see another year finishing like this probably ever again. Foreign countries are using their allocations of U.S. quota as the last they will ever see. When quota restrictions on foreign countries are eliminated January 1, 2005, is when we will see the emergence of the new world order in apparel and textile power.”

After consulting with about 20 countries on Aug. 3, World Trade Organization Director General Supachai Panitchpakdi decided against calling an emergency to discuss the effects of the pending elimination of quotas. However, the issue is expected to be raised at a previously scheduled October 1 meeting of the WTO’s Council on Trade in Goods.

Pierce said, “We still do not expect to see an extension of the quota system, but what developing countries will do to adjust to the post-quota environment. SGMA will deliver an industry statement to Governor Babauta in a meeting scheduled on August 11, and at that time we will make our best estimate on how our factories will adjust to that same post-quota environment.”

SGMA is comprised of 25 of Saipan’s 27 licensed apparel manufacturers. The industry accounts for nearly 16,000 jobs and yields a third of CNMI budget income.