Originally: Haiti struggles to save its apparel industry

 March 28, 2005

Haiti’s once vibrant apparel industry is shrinking amid changes in the garment business, instability in the island nation and rising competition from low-cost China.

The poorest country in the Americas has lost about 5,000 garment jobs in the last year, or one in six in its top industry.

That leaves only about 25,000 people in the business that employed at least twice that number at its peak in the 1980s, executives said at a recent trade show in Florida.

Hardest hit: small manufacturers, who used to rely on U.S. companies sending them piecework to be assembled into clothes and shipped back to the United States.

The trend today is for U.S. buyers to ask factories to take on more responsibility. Contractors increasingly must find and buy fabric, zippers and supplies; cut patterns; sew garments; pack clothes and in some cases, ship them to specific stores, in what is called “full-package” production. Those tasks require more cash, technical know-how and managerial skill than assembly.

Many Haitian factories can’t make the switch. With small volumes, they can’t afford to buy and run fabric-cutting machines and the high-tech equipment needed to track more complex inventories and tasks.

Furthermore, they face brutal competition. The system of quotas on world apparel trade ended Jan. 1, giving China and other nations with low-cost labor and strong fabric industries more U.S. access.

To avert steeper losses, some Haitian companies are joining to offer “full-package” between them. The months-old Astralis Group spans about a dozen firms, including manufacturers and banks. They’re working with U.S. consultants specializing in full-package production, said Astralis President Marie Louise Baker.

“We’re hoping we can save jobs and keep many factories open,” she said at Haiti’s booth at the recent Material World trade fair in Miami Beach.

Haitian leaders also are pushing a new bill in the U.S. Congress that would let Haiti import some non-U.S. fabric and sell clothes made with that fabric to the U.S. market without duties. Current law lets Haiti sell U.S. duty-free only when garments use U.S. cloth.

Supporters, including Rep. Charles Rangel, D-N.Y., say the legislation would help make garment manufacturing in Haiti more attractive, since a mix of cloth from Mexico and other specified nations may be cheaper than all-U.S. fabric.

Haiti has been pushing similar legislation for several years, but faced opposition from some U.S. fabric makers. They feared imports of non-U.S. cloth could hurt their sales in Haiti and could set a precedent for other nations.

But Astralis consultants said they hope U.S. fabric makers will see the bigger picture and back the bill known as HOPE.

“Haiti’s production is so small that it’s not going to have any effect on the United States,” said apparel specialist Don Truluck of High Point, N.C., noting some factories in China produce more than all Haiti combined.

Plus, reviving Haiti’s garment industry can help a nation where 80 percent of residents live in abject poverty. A stronger Haiti long term will boost future sales of all U.S. goods to a neighbor that trades mainly with the United States, added Barry Horowitz of Boca Raton-based Linbar Group.

“The enemy for the U.S. textile industry is not Haiti. It’s China,” Horowitz said, charging Beijing with subsidizing its fabric industries to drive down prices and unfairly compete with U.S. producers.

To be sure, Haitian companies still face hurdles convincing buyers that their troubled island — with its interim government, violent clashes and weak transport systems — can handle apparel contracts.

But Baker and others note Haiti’s factories are filling orders now, and business should be smoother after elections set for late this year and if the HOPE legislation is approved.