‘Inaccurate’ info about garments’ future scored

SGMA executive director Richard A. Pierce took exception yesterday to comments made by Finance Secretary Fermin Atalig that garment user fee collections this year would remain “near or at the same level” as in previous fiscal years as buyers from tsunami-stricken areas in Asia could shift to Saipan.

“With all due respect to CNMI Finance Secretary Atalig, SGMA members are quite sensitive to inaccurate information being broadcast that, in turn, may hamper efforts by those that would otherwise assist us, in the name of protecting the CNMI economy, as a whole,” said Pierce.

He said he seriously doubts that any factory on Saipan would receive additional orders as a result of the recent tsunami in Asia.

He pointed out that, in the time it would take to redirect lost orders, ship in fabric and accessories, assemble the apparel products and ship them to America, not only would the goods be out of season, the “unnamed” factories in the tsunami-stricken areas would have already been repaired and back in production.

As for Atalig’s assertion that the factories on Saipan are mostly owned by Chinese shareholders, Pierce said, “This is also inaccurate.”

“Of the 25 licensed factory operations in Saipan, 14 are Korean owned, six are Chinese owned, four have U.S. shareholders and one is a joint Korean/Japanese ownership,” he said.

“What is most inaccurate, and potentially more damaging for providing government services and jobs, is that the Secretary states, ‘I’m hoping we can maintain user fees of $30 million in fiscal year 2005.’”

“SGMA unequivocally states, ‘If wage rates, tax structure and trade privilege status remains unchanged in FY 2005, the income to the CNMI will drop by 10 percent automatically without a lost factory. And, believe me, we will lose a factory. The CNMI will lose from 10 to 50 percent of current factory revenue depending upon the number of factory closures. By the end of FY 2006, this figure will rise to from 50 to 80 percent.”

At the same time, Pierce said the attorney general’s contention that as long as the CNMI has duty-free status, this will guarantee the factories’ existence “is wrong.”

“Duty-free access brought the factories to Saipan, it will not keep them here. And, the idea that a bonded warehouse will somehow benefit us is inaccurate, as well,” he added.

“We will continue to do our best to provide the CNMI the most accurate information about our industry and its benefit to the CNMI. We just wish more of our leaders would attend when we do our public presentations.”