PORT-AU-PRINCE, HAITI
As former U.S. President Bill Clinton looked on,
Haiti's government signed a deal Tuesday with a
South Korean garment manufacturer to create an
industrial park that will export clothing to the
United States.
The deal on the eve of the one-year anniversary
of Haiti's devastating earthquake will make Sae-A
Trading Co. Ltd. the largest private employer in
an impoverished Caribbean nation desperate for
work.
Officials said it will create 20,000 jobs -- though
many who work in Haiti's few existing garment
factories today say their low wages are not
enough to feed their families.
"I know a couple places in America that would
commit mayhem to get 20,000 jobs today,"
Clinton said at the gathering in a Port-au-Prince
industrial park.
Haitian Prime Minister Jean-Max Bellerive said the
agreement will help break Haiti's dependence on
foreign aid as a substitute for a functioning
economy.
"Aid had never been able to bring sustainable
economic prosperity to any nation, including
ours," Bellerive said. He called the signing "the
best day of my life."
The deal was in negotiation long before the
earthquake, moving forward after Clinton was
named U.N. Secretary-General Ban Ki-Moon's
special envoy to Haiti in 2009 and given
responsibility for increasing private investment.
Garment factories were identified as a key area for
growth because under the relatively stable rule of
dictators, and before the political upheaval that
followed their ouster, Haiti was an important
regional manufacturer of cheap clothing and
other goods.
The agreement will create an industrial park near
the northern city of Cap-Haitien also open to other
factories. It is scheduled to open in early 2012.
Sae-A said it will invest $78 million on equipment
and agreed to adhere to International Labor
Organization standards.
The United States, represented at the signing by
senior State Department official Cheryl Mills, will
provide $120 million for generating electricity,
housing for workers and improvements to the
port.
The Inter-American Development Bank will
provide $50 million for building factory shells and
infrastructure. The European Union is separately
spending to improve roads in the region.
Haiti's government will own the park and contract
its management.
Clinton said he hopes the deal will encourage
other investors to move forward with projects in
Haiti.
"We took a big step in the right direction today,"
he said.
Clinton identified Gap, Wal-Mart and Hanes
Brands as likely major participants, as they have
agreed to purchase at least 1 percent of their
inventory from Haitian sewing factories. An
expert from Gap helped consult on the deal.
Sae-A chairman Woong-Ki Kim said the deal will
increase the company's capacity. Among the
company's 20 existing factories are plants in
Nicaragua, Guatemala, Indonesia and Vietnam.
There are mixed opinions about the quality of life
for workers in the factories. Few Haitians have
formal work and many jump at the chance to
receive any regular wage.
The key report by economist Paul Collier,
commissioned by Ban and quoted in press
materials given out at the signing, identified Haiti's
low wages as a competitive advantage, saying it
has "labor costs that are fully competitive with
China."
Attempts to significantly raise the minimum wage
in Haiti's factories have since been stymied.
Under a compromise law passed over street
protests in 2009, Haitian garment factories must
pay workers at least $3 a day -- less than two-
thirds the minimum wage for other jobs in the
country. The Haitian congressman who
championed a further increase won a rare
senatorial victory as an independent against
President Rene Preval's Unity party in the Nov. 28
election.
The deal signed Tuesday was furthered by U.S.
legislation that expanded duty-free access to the
American market for Haitian textile and apparel
exports through 2020. Rep. Ileana Ros-Lehtinen,
the new Republican chairwoman of the House
Foreign Affairs Committee, was at the signing.
The deal is one of the few significant plans toward
the government's post-quake goal of reversing
decades of migration from the desiccated
countryside to Port-au-Prince.
Sae-A has also been considering putting factories
in a largely undeveloped area north of Port-au-
Prince.
The head of a Haitian firm that was active in those
negotiations also led the government's post-
quake relocation commission. He identified his
company's own land near the proposed site to
put Haiti's first official quake relocation camp, an
Associated Press investigation found last year.
Built by the U.S. military, U.N. and aid groups, the
camp is largely considered a failure -- too remote
from services and suffering floods from summer
storms. Plans for further relocation camps were
scrapped.
Source: Http://www.businessweek.com/ap/financialnews/D9KMGUI00.htm
As former U.S. President Bill Clinton looked on,
Haiti's government signed a deal Tuesday with a
South Korean garment manufacturer to create an
industrial park that will export clothing to the
United States.
The deal on the eve of the one-year anniversary
of Haiti's devastating earthquake will make Sae-A
Trading Co. Ltd. the largest private employer in
an impoverished Caribbean nation desperate for
work.
Officials said it will create 20,000 jobs -- though
many who work in Haiti's few existing garment
factories today say their low wages are not
enough to feed their families.
"I know a couple places in America that would
commit mayhem to get 20,000 jobs today,"
Clinton said at the gathering in a Port-au-Prince
industrial park.
Haitian Prime Minister Jean-Max Bellerive said the
agreement will help break Haiti's dependence on
foreign aid as a substitute for a functioning
economy.
"Aid had never been able to bring sustainable
economic prosperity to any nation, including
ours," Bellerive said. He called the signing "the
best day of my life."
The deal was in negotiation long before the
earthquake, moving forward after Clinton was
named U.N. Secretary-General Ban Ki-Moon's
special envoy to Haiti in 2009 and given
responsibility for increasing private investment.
Garment factories were identified as a key area for
growth because under the relatively stable rule of
dictators, and before the political upheaval that
followed their ouster, Haiti was an important
regional manufacturer of cheap clothing and
other goods.
The agreement will create an industrial park near
the northern city of Cap-Haitien also open to other
factories. It is scheduled to open in early 2012.
Sae-A said it will invest $78 million on equipment
and agreed to adhere to International Labor
Organization standards.
The United States, represented at the signing by
senior State Department official Cheryl Mills, will
provide $120 million for generating electricity,
housing for workers and improvements to the
port.
The Inter-American Development Bank will
provide $50 million for building factory shells and
infrastructure. The European Union is separately
spending to improve roads in the region.
Haiti's government will own the park and contract
its management.
Clinton said he hopes the deal will encourage
other investors to move forward with projects in
Haiti.
"We took a big step in the right direction today,"
he said.
Clinton identified Gap, Wal-Mart and Hanes
Brands as likely major participants, as they have
agreed to purchase at least 1 percent of their
inventory from Haitian sewing factories. An
expert from Gap helped consult on the deal.
Sae-A chairman Woong-Ki Kim said the deal will
increase the company's capacity. Among the
company's 20 existing factories are plants in
Nicaragua, Guatemala, Indonesia and Vietnam.
There are mixed opinions about the quality of life
for workers in the factories. Few Haitians have
formal work and many jump at the chance to
receive any regular wage.
The key report by economist Paul Collier,
commissioned by Ban and quoted in press
materials given out at the signing, identified Haiti's
low wages as a competitive advantage, saying it
has "labor costs that are fully competitive with
China."
Attempts to significantly raise the minimum wage
in Haiti's factories have since been stymied.
Under a compromise law passed over street
protests in 2009, Haitian garment factories must
pay workers at least $3 a day -- less than two-
thirds the minimum wage for other jobs in the
country. The Haitian congressman who
championed a further increase won a rare
senatorial victory as an independent against
President Rene Preval's Unity party in the Nov. 28
election.
The deal signed Tuesday was furthered by U.S.
legislation that expanded duty-free access to the
American market for Haitian textile and apparel
exports through 2020. Rep. Ileana Ros-Lehtinen,
the new Republican chairwoman of the House
Foreign Affairs Committee, was at the signing.
The deal is one of the few significant plans toward
the government's post-quake goal of reversing
decades of migration from the desiccated
countryside to Port-au-Prince.
Sae-A has also been considering putting factories
in a largely undeveloped area north of Port-au-
Prince.
The head of a Haitian firm that was active in those
negotiations also led the government's post-
quake relocation commission. He identified his
company's own land near the proposed site to
put Haiti's first official quake relocation camp, an
Associated Press investigation found last year.
Built by the U.S. military, U.N. and aid groups, the
camp is largely considered a failure -- too remote
from services and suffering floods from summer
storms. Plans for further relocation camps were
scrapped.
Source: Http://www.businessweek.com/ap/financialnews/D9KMGUI00.htm
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