23 May 2007

Raising minimum wage in CNMI will erase garment industry - Chamber of Commerce

9:20 am on 23 May 2007

The president of Saipan's Chamber of Commerce, Juan Guerrero, says moves by the U.S Congress to raise the minimum wage will erase what's left of the garment industry in the Commonwealth of the Northern Marianas within months.

The controversial minimum wage bill, if enacted, will eventually more than double the U.S. minimum wage on CNMI from its current $3.05 to $7.25, over a number of years.

Mr Guerrero says it can't afford any wage hikes, given the Commonwealth's ailing economic situation.

He says many factories have already closed because they can't compete with the low wages paid by developing countries that can now export their cheaper garments to the U.S.

Garment sales in CNMI dropped 42 percent or about 16.7 million US dollars in April, compared to the same period last year.

"As the President of the Chamber of Commerce, y'know sometimes I see this as a major problem because smaller smaller garments are still here, but we really don't know. If there's any increase in the minimum wage, then definitely the garment industry is history, in less than 60 days."

Mr Guerrero says the garment industry is one of the main industries for the Commonwealth, next to tourism.