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2005 user fee total plunges
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Posted on Jan 09 2006
The Customs Division’s user fee collections from Saipan garment factories jumped back over the $2 million mark in December 2005, netting the CNMI $24.1 in collections for calendar year 2005.
Compared with 2004 collections, however, the $24 million collected represents a drop of 21.5 percent. Comparing collections from the factories, the 2005 totals are down 38.6 percent against collections in 2000.
Price point competition and the elimination of quota restrictions upon member countries of the World Trade Organization cost the CNMI approximately $44.8 million in user fee collections alone since 2000.
“It is no coincidence that our loss, like everyone else’s, is China’s gain. Despite ongoing trade disputes and a devaluation of the yuan, China’s textile industry grew roughly 20 percent in 2005. According to the Xinhua news agency, a report from the China Chamber of Commerce for Import and Export of Textiles estimated that sales revenue totaled $250 billion in 2005, with profits of about $8 billion,” said Richard A. Pierce, the former governor’s special assistant for trade relations.
There were 34 factories operating in Saipan in 1999. Today there are 20 in operation, with two more scheduled for closure within two months. It is generally accepted that a number of smaller firms will be closed within 2006.
“To preserve what revenue we collect from the remaining factories, and to provide jobs and commerce for other businesses that service the industry, our sole focus remains on a reduction in operating costs through a change in the tariff privilege granted by the U.S. federal government,” said Pierce.
“I have confidence, with the work of those sincere in addressing members of the U.S. Congress about our economy and its industries, the federal government will eventually grant us relief from the disproportionate advantage China and other foreign countries now command,” Pierce added.
