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U.S.

Department of State Factsheet: North Industrial Park in Haiti

BUREAU OF WESTERN HEMISPHERE


PHERE AFFAIRS

Fact Sheet

January 11, 2011

State Department Counselor Cheryl Mills participated in the signing of an agreement between Sae-
Sae
A Trading Co. Ltd., the Government of Haiti, the U.S., and the Inter
Inter-American
American Development Bank to
develop a 623-acre industrial
ial park in northern Haiti. The fact sheet below was provided by the U.S.
Embassy Port-au-Prince
Prince at the event.
The Government of Haiti, the United States Government through the Department of State, and the Inter- Inter
American Development Bank closed a deal to b build
uild an industrial park in the Haiti’s North Corridor with
Sae-A A Trading Co. Ltd., Korea’s leading garment manufacturer, as the anchor tenant. The North
Industrial Park, which is projected to create 20,000 permanent jobs through Sae Sae-A’s
A’s investment alone,
fulfills
ulfills priorities in the Government of Haiti’s National Action Plan to create centers of economic
development outside of Port-au- Prince for Haiti’s future growth and to bring much needed jobs to Haiti’s
underserved regions. The IHRC facilitated and appro approved
ved this effort, marking the first major public-private
public
partnership to bring permanent jobs to Haiti since the January 12, 2010 earthquake. The U.S. Congress’s
passage of the Haiti Economic Lift Program (HELP) Act in May 2010 was a critical catalyst by significantly
sig
increasing U.S. trade preferences for Haitian apparel, which in turn made Haiti more attractive to large
scale manufacturing operations like SaeSae-A.
A. Each signatory has committed to investments in the
development of the Park and the surrounding ar area,
ea, including park infrastructure, housing, waste-water
waste
treatment, port modernization and electrification. This agreement brings to fruition the Memorandum of
Understanding signed in September on the margins of the United Nations General Assembly, where the th
parties agreed to explore the viability of a globally competitive industrial park and major manufacturing
operation in Northern Haiti. Park operation and manufacturing activity is projected to begin in the first
quarter of 2012.
About the North Industrial Park:
The Park will:
 Create 20,000 full-time
time Haitian jobs in the first phase with Sae
Sae-A’s
A’s investment alone, making it the
largest private employer in Haiti.
 Create in excess of $500 million in wages and benefits over ten years, with each worker earning
3-4
4 times Haiti’s current GDP per capita (per capita GDP is approximately $640, whereas apparel
jobs will pay approximately $2,400).
 Directly support the livelihoods of 100,000 to 120,000 Haitians.
 Grow to support 65,000 permanent jobs once the Park is full
fully developed—increasing
increasing Haitian
garment industry related jobs by more than 200%.
 Grow the number of formal registered private sector jobs in Haiti by at least 20%
 Create Haiti’s first textile mill with knitting & dyeing.
 Be the first manufacturer to produce apparel with textiles made in Haiti, reducing dependence on
imported raw materials and dramatically increasing the value added component in Haiti for each
garment manufactured.
 Grow the tax base through increased employment and trade flows.
Investment in the Park will also:
 Include local housing development in nearby communities, including at least 5,000 homes
 Result in a modern port for the Northern region and a rehabilitated road network benefitting the
Park as well as other industries such as tourism and agriculture.
 Provide electricity beyond the Park’s grounds in surrounding areas that currently lack access to
an electric grid.
 Create, in addition to the first 20,000 jobs created by Sae-A, and additional 15,000 or more jobs
as the first phase of the park is built out in microenterprises, smallholder farming, food vending or
financial services.
 Double, through Sae-A’s investment, the Foreign Direct Investment Haiti received in all of 2009.
Each party’s commitments:
 Sae-A will commit at least $70 million for facility development, machinery and equipment. It will
occupy 50 hectares and employ 20,000 Haitian workers in compliance with International Labor
Organization standards.
 The Government of Haiti will, as owners of the Park, contract for park management and provide
support and oversight, including ensuring new construction adheres to earthquake and hurricane
resistant standards.
 The United States Government will provide more than $120 million in grant funding for the
Park’s power generation, housing in communities in proximity to the Park and port improvements.
 The Inter-American Development Bank will invest at least $50 million in grant funding for the
development of factory shells and inside-the-fence infrastructure.
 While not party to the agreement, the European Union is making grant funding investments to
support road improvements, including critical access roads and major arteries in the North.
Background on the garment industry in Haiti:
 Twenty years ago, Haiti’s apparel industry was a reliable supplier of assembled goods to the U.S.
market and employed as many as 100,000 workers. Today, the industry employs approximately
28,000 workers.
 The value of Haitian apparel exports to the United States ($512 million) was approximately 10
percent of Haiti’s GDP in 2009, constituting approximately 90 percent of the country’s exports.
 With the passage of the HELP Act by the U.S. Congress, firms in the apparel industry have
expressed interest in expanding sourcing in Haiti to benefit from improved duty-free access to the
U.S. market.
 Garment manufactures operating in Haiti have added over 4,000 jobs to the industry since the
January 12 earthquake. Not only have jobs lost immediately after the disaster been recovered,
the industry now employs more people than before the earthquake. The largest companies have
outlined aggressive investment plans to expand further to benefit from enhanced trade
preferences.
 Daily instruction and information in garment factories has also successfully kept incidences of
cholera at bay in the industry. Educating the workforce on hygiene and sanitation, along with
distributing water purification tablets, has resulted in only two cases of cholera being reported and
treated in Haitian factories.
Haitians need something more fundamental than relief from the present situation; they need jobs that they
can count on for years ahead. For this, the private business sector is essential. --Paul Collier, Economist,
1/28/10