WITH U.S. OCCUPATION, MAKERS CONSIDER RETURN TO HAITI

Byline: Joanna Ramey With contributions from Jim Ostroff

WASHINGTON — The expected political shifts in Haiti have some apparel manufacturers thinking about the possibility of returning production there.
With the U.S.’s occupation targeted at returning democratically elected President Jean-Bertrand Aristide to power, U.S. apparel firms who previously sent their goods to Haiti for assembly say the embattled nation still holds promise as a place to source. The makers say they would consider going back if the United Nations lifts its trade embargo. But even if the U.S. occupation of the country results in a return to a democratic government, there is still some nervousness among manufacturers given Haiti’s past turmoil.
“Once we see that things are quieting down, we would definitely consider returning,” said Sam Benson, vice president, Elsie Undergarment Corp., Miami, which once produced about 30 percent of its apparel in Haiti. That production was relocated to Guyana and Jamaica.
“It was a good place to manufacture, and when the country is stable, we will evaluate going back,” said a spokeswoman with Kellwood Co., St. Louis. Kellwood operated a women’s lingerie factory in the capital of Port-au-Prince for nine years until it was shuttered in April.
President Clinton has said lifting the trade embargo is essential to getting the country back on its feet, but neither he nor U.N. officials have said when sanctions will be lifted. A broad trade embargo has been in place on and off since a September 1991 military coup unseated Aristide.
Assembly operations were exempted from the embargo until May 21 when all trade was ordered to come to a halt.
One manufacturer who expressed uneasiness about a return was Sid Sobel, president, Ocean Blue Designs, New York. Sobel argued that to facilitate the return of smaller businesses to Haiti there should be financial incentives. He said he would like some of the expected $1 billion in foreign aid to Haiti to be targeted at low-interest business loans.
In addition, the U.S. government could offer special tariff breaks for Haitian imports, he said, other than those already offered for assembly of U.S.-cut fabrics in the Caribbean.
“I’m really looking for assurances from the U.S government before I can make an intelligent decision on Haiti,” Sobel said. Sobel’s swimwear and activewear company owns a factory in Haiti, its only foreign facility.
Before shuttering, it employed about 300 Haitians. The company still has 300 sewing machines in the plant. Ocean Blue has been hit hard by the embargo, despite being able to relocate some of its production to a rented facility in the Dominican Republic, Sobel said. Because of the added start-up costs and the fact that 20,000 swimsuits are stranded in Haiti because of the embargo, Sobel said he has had to lay off 40 people at the company’s headquarters. Now four remain.
“If that embargo isn’t lifted quickly, companies in our position are going to be faced with tremendous hardships,” Sobel said. “We are hopeful of a successful solution, and we’re hopeful the U.S. government will give us some kind of guarantees our capital investments will be protected.”
“It’s in everyone’s interest in Haiti to get people productive again,” said Sally Yerwood, director of special programs with Caribbean Central American Action, an advocate of encouraging foreign investment in the country. “Haitians will want to feel that a return to democracy also means a return to work.”
Yerwood agreed that a portion of the relief money should be focused on business loans. “This would allow manufacturers to start at full capacity instead of half because of cash flow,” she said.
Until the full trade embargo, Haiti had become a growing supplier of U.S.-made apparel. Last year the value of shipments increased 49.2 percent to $91.7 million from 1992’s level of $61.45 million.
Eugene Milosh, president of the American Association of Exporters and Importers, said Haitian apparel production could be up and running within a year.
“We’re not talking about jump-starting an economy like Russia, but a small country close to the U.S., where companies had no qualms before about investing,” Milosh said.
The always competitive apparel industry could indeed spur this return to Haiti, he said. “You have emerging companies all the time that are looking for production and cost advantages. So while firms may have left Haiti for the Dominican Republic, Mexico or Chile, you can expect some of them will return and other new ones will set up operations in Haiti,” he said.
— Fairchild News Service

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