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Headnote3(a) amendment still being pushed
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Posted on Feb 08 2006
The Fitial administration supports efforts to amend Headnote 3(a) of the U.S. Tariff Code to help local-based apparel manufacturers compete globally, but it has no budget to hire lobbyists who will push for it in Washington D.C., said press secretary Charles Reyes Jr. yesterday.
“It’s extremely difficult to hire lobbyists. It’s quite a challenge, especially at this time. That [hiring lobbyists] may not be the best approach,” said Reyes.
The Babauta administration hired last year a consultancy firm to lobby for the amendment, which would lower the value-added requirement on CNMI export garment products from 50 percent to 30 percent. This would result in less production cost for the local industry.
The consultant’s services reportedly expired last November.
Reyes said that the new administration relies mainly on the Washington Representative Office on the issue. There is no update so far on the matter, he added.
He said the Fitial administration believes that the amendment would help the CNMI rely less on nonresident labor since it would allow up to 70 percent of work to be done abroad.
“Currently the requirement is 50 percent. The amendment would raise this [foreign content] to 70 percent. It means that more work can be done abroad,” he said.
For his part, Saipan Chamber of Commerce president Charles V. Cepeda expressed hopes that the Headnote3(a) amendment bill would be introduced again in the U.S. Congress.
“We really hope that this can be done soon to help the local industry. It has a great impact on the overall economy,” he said.
A bill, S. 1954, the Insular Possessions Act of 2005, was introduced in the U.S. Senate for the Headnote 3(a) amendment by Democrat Sen. Daniel Akaka from Hawaii and Idaho Sen. Larry Craig but it was not acted on prior to the adjournment of Congress last year.
