Garments exporter Luen Thai puts PHL investment on hold

A garments exporter will put on hold its $5-million commitment to produce 150,000 pairs of Ralph Lauren jeans a week and generate 2,000 jobs in the Philippines, until the US approves a bill granting special treatment to Philippine apparel. Luen Thai, a garments company based in America, Asia, and Europe, will put the investment on the backburner until the US Congress passes the Save our Industries or SAVE Act, which will waive or reduce the duty imposed on Philippine garments that use American textile, yarns, and fabrics. “Unless we can get this bill moving, there’s no point investing in a denim facility," Rick Helfenbein, Luen Thai USA president, told a press conference. “The sooner it gets passed, the better." Through a memorandum of understanding, Luen Thai committed three projects in the Philippines during the visit of President Benigno Aquino III to the US last year. The company has made good on two commitments: the expansion of Luen Thai’s Clark facility in Pampanga and its new Coach bag production investment. Trade Undersecretary Cristino Panlilio on Monday said a leaner version of the SAVE Act will be refiled in the 112th US Congress. To be deleted in the new version is the component seeking reduced tariff on Philippine garments made of US yarn, in response to the opposition of some American trade groups who tagged it as “unfair competition." The number of categories to enjoy duty-free entry to the US regardless of the fabric’s source will also be trimmed down. “We would lean towards more lines using US fabric than third-party fabric," Panlilio said. Seventeen lines that would use US fabric were proposed to enter the US duty-free. Another change would provide for allowing Philippine exporters to source from non-American supplier if the US fabric runs short. — With Paterno Esmaquel II/VS, GMANews.TV