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Shoe firm exec checks out NMI
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Posted on Feb 14 2006
A top official of Yue Yuen Industrial (Holdings) Lt. was on Saipan last week on a fact-finding trip to look into the feasibility of establishing a footwear manufacturing industry on Saipan. With operations in China and Los Angeles, California, Yue Yuen is one of the world’s largest manufacturers of high quality athletic footwear.
Yue Yuen executive vice president Allen Lee met with Gov. Benigno R. Fitial to discuss the possibility of establishing a shoe manufacturing operation in the CNMI. Lee indicated that if the company finds the cost of doing business on Saipan to be competitive, they may look into developing selected, non-sensitive lines of athletic shoes here in the future.
While Saipan enjoys duty-free access to the U.S. market, it has a relatively high cost of doing business.
The company is reportedly looking into incentives under the Free Trade Zones Act or CDA Qualifying Tax Certificate to help give this potential new industry an opportunity to establish itself on the island.
OPA (outward processing arrangement) shoe manufacturing is not labor-intensive, but it generates a high volume of shipping. Fitial believes it might be an excellent alternative to diversify Saipan’s economy. Because the volume of shipping generated is high, shoe manufacturing could be a very attractive industry to help protect certain volumes and level of service in the shipping industry as the garment industry declines.
Unlike the garment industry, jobs that would be created in shoe manufacturing do not require specialized sewing or technical skills and may be of interest to some local residents. Training to work in such a facility on Saipan might be provided by Los Angeles-based personnel, where Yue Yuen now employs 1,200 making famous international brand footwear.
During the 2001 and 2005 gubernatorial election campaigns, then Speaker Fitial repeatedly highlighted the possibility of diversifying the CNMI economy by attracting new industries such as a shoe manufacturing operation. The Governor’s Office said that Fitial is now “working hard to realize that goal” for CNMI residents struggling in a depressed economy. (PR)
