On Wednesday, April 14, 2004, Saipan Garment Manufacturers Association’s (SGMA’s) spokesperson, executive director Richard A. Pierce, presented supplemental information to CNMI House and Senate Members, in response to an invitation by House Speaker Benigno R. Fitial to provide Members with revenue totals and projections in considering the Administration’s Integrated Fiscal Plan.

“SGMA presented House and Senate Members with an economic industry overview in mid-February. New statistics and the effects WTO quota elimination were offered yesterday to assist our leaders with their plans for providing essential public services in FY 2005”, stated Pierce.

Other material, (incorrectly attributed as delivered by SGMA in an April 15 Saipan Tribune article), was presented by other factory representatives at that meeting. The material was a power point presentation entitled “What’s At Stake If the Saipan Garment Industry Leaves ?”, which was delivered by Concorde Garment’s Eloy Inos.

“Mr. Inos did a commendable job, from what I saw of his presentation. I had to leave prior to his show, but I understand that much of what SGMA has been offering to the public was presented within their material. I appreciate what Mr. Inos did to convey all of our concerns about our industry’s future health and place in the Commonwealth”, reported Pierce.

Pierce offered rebuttal to recent press coverage on increases in industry sales and user fee payments to the CNMI Government. He reported that the industry’s taxes paid to CNMI Customs shows only a 2.8% increase over the first half of this fiscal year, when compared to last year’s same period.

Pierce further stated that the association expects FY 2004 annual totals to reach FY 2003 totals, and perhaps slightly exceed those numbers. According to the industry spokesperson, this is only due to their buyers’ uncertainty in placing orders in foreign countries where quota will be exhausted before the end of the year.

“Saipan gets its annual windfall at the end of the foreign country quota year. Buyers are even more willing to place their orders here, as the uncertainty increases the nearer we approach the World Trade Organization’s elimination of quota at the end of 2004”, says Pierce.

“Next year, no one knows where these orders will go. The slight increase we may experience for the next 7 months may disappear. We get orders now from quota exhaustion, while next year there’s no quota to exhaust”.

Pierce also added that any increase in user fee payments to the CNMI does not mean business is better for the factories. It means that the factory employees are working additional hours, companies are paying more overtime, and, therefore, are less profitable. With Saipan’s version of quota, its limitation on the number of non-resident workers allowed to enter and work in the factories, there’s not much sense in taking orders they could easily land if they just had the employees.

SGMA also reported that foreign countries, and textile groups, are banding together to seek government endorsements for extending the current quota systems into 2007.

In attempting to delay the elimination of quotas among WTO members, groups from Europe, North America and Africa representing 26 countries have signed onto the “Istanbul Declaration” over the past four weeks. There is, generally, little chance expected to delay the quota changes as many countries have received their own governments’ assistance in bracing for the 2005 changes through tax reductions and other support.

SGMA reported to its CNMI elected leaders that it would not support any increases in user fees, taxes, or wage rates when its very existence is threatened by its foreign competitors in China who will have no quota restrictions next year.

“We are a sunset industry, and an industry that can be eliminated even quicker without our Government understanding our economics. I have faith that our leaders will protect their garment industry, and more confidence in their decisions the more we discuss what needs to be done.”