American Apparel Companies Interested in Investing in Haiti
By Dialogo April 30, 2010Prior to the January earthquake that devastated Haiti, textile manufacturing accounted for three-quarters of the country's export earnings. The sector employed more than 25,000 people. After the quake, estimates suggest the industry is operating at about 50 percent capacity. If U.S. companies begin manufacturing in Haiti, experts say the industry there could support 100,000 jobs. John Park is manager of the Astro Embroidery company in Port au Prince. The company is based in the Caribbean. In 2008, the U.S. Congress passed a law, commonly known as Hope II, granting duty-free access for Haitian textiles. Astro Embroidery, which owns factories in Honduras, moved quickly to start operations in Haiti. "First of all, we come here to Haiti because HOPE regulation passed in Congress, USA. And we expected a lot of textile company come to Haiti," Park said. "And then we [are] coming here to prepare service for them." Two years later, most of his machines are silent. Only four employees are still working. "If we have 100 percent productivity, there will be 70 to 80 employees can be here," Park said. The American apparel manufacturers have not come. He says they fear Haiti is not stable enough for business. Stephen Lamar is executive vice president of the American Apparel and Footwear Association. He says U.S. apparel firms are interested in manufacturing in Haiti but are reluctant because current legislation, including The Caribbean Basin Initiative, is short term and the volume of goods allowed into the U.S. is too low. "What you have right now is people are placing orders on the hope, no pun intended, on the hope that we are going to have the Caribbean Basin Trade Act extended," Lamar said. "Now, it has been extended a couple of times before, but that is no guarantee that it will be extended." But hope is on the horizon. When former President Bill Clinton visited Port au Prince in March he promised to pressure Congress to extend the trade laws and raise the ceiling on duty-free imports. "So we pledged to do what we could to get the changes adopted by Congress that will enable you to make maximum use of this law. And I think it could create a 100,000 jobs in Haiti in short order," he stated. For John Park, the extensions will not come soon enough. He says the company had to dip into savings to stay afloat. "We need help. But so far we are okay. We can survive," he said. "But I am really concerned now. One more year if we don't have enough work, we could be out of business." Some question whether textile jobs are the best option for Haitian workers. Haiti's minimum wage is about $3 (US) a day. Astro Embroidery pays its employees a salary and bonus equal to about $6 (US) a day. But garment worker Fifi Rico told us that is not a living wage. "Because what they get is enough for them to eat. They don't have enough to pay for housing," he said. The American Apparel And Footwear Association told us the industry has strong interest in helping to rebuild Haiti. Lamar says work has begun on Capitol Hill to extend both trade acts.