Hello, I have been researching doing business in the DR for over a year and have desired to make a visit to Santo Domingo for sometime now. My partner and I will be arriving early March and would like very much to have a business professional show us around the city. We are looking for someone that is well informed and can explain both the pros and cons of doing business in the DR. I would be further pleased if this person had knowledge of setting up free zone business (not essential) . We are interested in the history of city, universities, points of interest, hot spots, and not so hot spots. We are young professional business men but like to have fun too. Is there anyone on this discussion groups that can assist us? Your time and knowledge will be compensated. Thank you. ? Bart and Adrian
- Thread starter BizWiz
- Start date
expert in Santo Domingo area
Ok, 1st Welcome to DR1!!!!
Ok, 1st Welcome to DR1!!!!
I'm going to move this to the Business Forum.
That said.
I Moderate the Living Forum.
My handle is Timex, my name is Tim H.
I live 15min, outside of the Capital.
Your asking about a Free Trade Zone?
BizWiz, I have not recived 1 e-mail or pm from you. :ermm:
I couldn't agree more! Free Trade! But it's not just China, it's the whole dam World, Mexico-India-The Banana Republics, the Caribbean?s, and so-on & so-on.
NO WORKERS COMP, OSHA, EPA, HAZMAT,UN-EMPLOYMENT INSURANCE, LIABILITY INSURANCE, FAMILY MEDICAL LEAVE ACT.
And everything else that can put a guy out of business. Like Law-suits for age/race/sex discrimination.
20 years ago, the largest job market in NY was manufacturing, today it's one of the smallest, under 400,000 people employed in this field for the year 2000.
I am in the Dominican Republic working for an American company. In a Free Trade Zone. The people I pass on my way to work......
Cutler Hammer, AVON, Allen Bradley, G.E. power equipment, Johnson & Johnson, TYCO INDUSTRIES.And many others, in this park established by the AMERICAN CHAMBER OF COMMERCE, yep my tax dollars were hard at work all those years.
Most of these companies have 500 to 800 employees, earning about $150. @ Month for a machine operator, operating machines like chip shooters, for manufacture of PC-boards for INTEL, and Wave Solder machines, assembly people earn a little less.
And while the economy has collapsed here in the last 2 years, and their version of the Federal Reserve( BANCO CENTRAL) is down to 75 million, in U.S. dollars, guess who came to the rescue with a loan for 1.25 Billion dollars??? WITH NO HOPE OF EVER SEEING IT BACK! George Bush & the IMF. Again there are soooo busy with those U.S.tax dollars, they can just add it onto the 87 billion they are taking out of future taxes for rebuilding Iraq.
As I work here, and my weekly paycheck is direct deposited from HQ in NY, to my NY bank account. I still pay S.S. and Medicare, but $0 on the State & Federal, because I am working outside the U.S. 320 days a year.
I have received allot of request's about this. Below is a portion of the IRS 593, (2555-EZ)exemption. At the bottom is a link for the full publication. As always, consult a professional for your tax advice, I did this, just out of courtesy.
Full Text
Scroll down to Publication 593
http://www.irs.gov/formspubs/lists/0,,id=101466,00.html
I still file my State & Federal Taxes every year, but the 1st $ 80,000. comes right off the top. Then I start getting taxed like I was living in NY.
When I run out of deductions, (ie: home owner, kids, travel for work.), and I see, I am starting to pay too much, I shift the balance of my pay to this side.
****************************************
1 company made of 2 parts.
Part 1 USA.
Has a large engineering staff, all disciplines 70 people.
Has a purchasing, logistics, and shipping department, 10 people.
Has a ware-house for out going ,incoming materials and merchandise, 20 people.
Has a small engineering rework department, 20 people.
Has an international sales staff of 30.
And the rest that would make up management.
These people are very well paid, have stock options, and the median for time employed is 15 years, better than most companies.
Everything needed for manufacturing, must be shipped by Part 1, to Part 2, by ocean going container, 2 containers a week leave the USA with raw materials. 2 containers a week arrive with finished goods. Machinery must be shipped in from Part 1, in the USA, to Part 2. Old equipment must be shipped back to the states, there is no exceptions to these rules. I can not sell an old chip shooter, or dispose of it in any way, here. That could cause an unfair advantage with the local manufacturers, who compete here and also ship goods to the states.
Logistics.
At all times, there are 2 containers in NY, being loaded.
There are 2 containers on the pond, on their way to NY, with finished goods.
There are 2 containers on the pond, on their way here with raw materials.
There are 2 containers here being loaded, with finished goods, to ship.
All containers are loaded and locked, at their perspective loading docks, and bypass the usual customs inspections. Once in awhile they are inspected, far and few in-between.
$ 300,000. of raw materials arrive every week.
$ 1,000,000. of finished goods, ship every week.
All assets, capital equipment, loss & depreciation, labor, utilities, property lease, are treated tax wise, as if being manufactured in the facility, in NY.
PART 2
My Company is a Fortune 500 and in this location.
And outside of the weekly payroll, we pay almost 800 people weekly, not bi-weekly like most do. The electric bill is our highest expense. We run 7 disciplines of manufacturing under 1 roof.
We have,
A Metal shop with a 60 Ton CNC Turret Punch Press, 15 OBI Punch Presses, 4 Guillotines, for cutting to size, 4 Brake presses for small runs. Also in there is 8 industrial Spot Welders, busy all day long.
Then there is a Powder Coating line with Wash Down and Drying Ovens all on a continuous conveyer.
We have a Printing Dept, that cuts and prints every thing from Packing boxes, Merchandise boxes, Instructions, every single piece of cardboard and paper we use.
The PCB Department, 10 lines of CNC Circuit board, component placement machines (Chip-Shooters), that to feed Wave solder?s. We go to 06/03, that would be .060 X .030, sized components, surface mounted.
A Microwave & RF assemby dept, for wireless communication devices.
A Molding Dept, 12 Injection molding machines, what doesn?t go in metal, goes in plastic.
A huge Assembly Dept, where all of the stuff is made into final finished goods.
This is all suported by a central Engineering and QC Departments.
We are now ISO 9002.
A Maintenance Dept, to support the auxilleries and each department.
Four 50Hp Air compressor?s, Two 50Hp Vacuum generators, and Four 3000Kw Standby Generators.
I have not seen such a variety of Engineering Disciplines, under 1 roof, anywhere else in the DR, yet. I?m still looking.
Labor Costs
Locale employees in the Free Trade Zone, earn 30% above their counterparts outside the AFTZ.
The average salary, for a technical operator( CNC chip shooter), maintenance man, machinist, is between $8,000. to $12,000. pesos @ month. $200 to $300 US dollars @ month.
A good department manager $20,000. to $30,000. pesos @ month. $500 to $750. @ month U.S.
A Section Leader, we have 7, about $50,000. pesos @ month. $1250 @ month U.S.
These salaries are 30% or more in difference outside the AFTZ.
1 example would be, an operator, at Magnachem, a Glaxo-Wellcome, pharmaceutical subsidiary, that did not set up in the Free Trade Zone, gets paid $2500. pesos @ month,
or $62. U.S. @ month.
Manufacturing outside the FTZ, allows you to market you goods, locally on the Island.
We can not.
The Free Trade Zone, is exempt for most locale laws and restrictions. It is treated like an Embassy, it has sovereignty recognition of its SPONSER
This island has over 50 Free Trade Zones. AFTZ (USA), Zona Franca (France), Zona Oriental (China), and so on, and so on.
Below is cut and pasted from this web site. If they don't work for you, let me know.
**************
WORKING IN THE DR / AND WORK RESOURCES.
*CLICK ON THE LINK BELOW TO VIEW*
*GETTING DOWN TO WORK!*
A GREAT 1 page primer, too read before the search for WORK.
*FREE TRADE ZONE LIST*
17 PAGES IN PDF FORMAT, BROKEN DOWN BY
FREE ZONE PARK-COMPANY-CONTACT- PHONE/FAX-EMAIL- ACTIVITIES
*NATIONAL FREE ZONES COUNCILE*
WEB SITE FOR THE D.R. GOVERMENT CNZFE.
If you have the labor cost, stuck in you head, please note the following.
The Pesos, is valued at the amount of U.S. Dollars, in reserve at the Banco Central.
From 1993 to December 2001, the peso, was rock solid at 16 to 1, U.S. dollars.
Since January 2002, the Newly Elected Government, has emptied the Central Bank (their Federal Reserve) from 2 Billion U.S. dollars, reserve, to 78 Million U.S. dollars reserve.
The Islands biggest bank has collapsed, and the peso has gone from $16 to 1, all the way to $40 to 1, U.S. dollars. Had been forecasted to go to $50 to 1, by January, by many, many Talking Heads!!!!
The problem, the more U.S. dollars that leave the Banco Central, the further the pesos slide.
As the peso has fallen over 100%, electric, gas, propane, food, has risen accordingly.
But salaries, have only grown 3 to 4% from the before era to now.
*******************************************
FOREIGN FREE TRADE ZONES
Benefits for location in a Free Trade Zone.
Passed in 1998 New Free Zone legislation, by the U.S. Congress.
100% exemption on import duties on raw materials, equipment, parts, components, samples and capital goods necessary for the production of the final product.
-100% exemption of taxes on remittances abroad
-100% exemption on export taxes
-100% exemption on sales tax of local purchases
of goods and services
-100% of municipal and capital taxes
-Exemption from import duties on vehicles necessary for operation
-No restrictions on capital repatriation
-No restrictions on sales to local exporters
-Companies may sell production in local market
-Management of foreign currency with complete independence from the local banking system
-Underdeveloped areas get additional benefits
Back in the Middle Ages the ports along the key trading routes were bursting with activity, and the conditions for storing and transshipment of goods played a substantial role in how successful they were.
And all over the world today, similar free-trading zone still exist. But since the middle of the last century a new type of zone has emerged: the export processing zone.
There are more than eight hundred free trade zones around the globe. The exact figure, however, depends on the kind of definition you use.
Free trade zones, in the new concept, are also termed economic zones, areas where export oriented companies that locate there can enjoy favorable terms and conditions.
They are exempted from custom duties and may even benefit from other tax and financial advantages like no income tax, low tax on profits and subsidized building.
The government determines the size of the zone: it could be a warehouse or a factory, an industrial estate or a whole region.
But more important than the numbers is the choice of location itself. They tend to be located in developing countries, particularly in Southeast Asia, Central America and North Africa. Countries where there is a need to boost the economy for their people.
By improving their export position with a free trade zone, a country can attract the kind of business economy that will provide work for its population.
? This happened in Europe at the beginning of the 1960s when Ireland, whose economy was in decline and whose unemployment was high, established a free trade zone. The area around Shannon airport still abounds with call centers and computer companies.?
If you look, for instance, at the Bahamas, you see the country has the highest scores for the tax regime and tax benefits component but scores very low in terms of regional integration and infrastructure.
The Dominican Republic is a very attractive free trade zone from the point of view of labor, pay and infrastructure.
Panama has a fantastic port and Jamaica the best papers in terms of regional integration and trade agreements.?
Singapore is exemplary. The island state has developed into a super hub over the centuries. Despite its size and its home market, Singapore has managed to become a world class transshipment port. Many major company?s have their headquarters there and there are distribution centers that operate all over the world.?
Just look at neighboring Trinidad, which has a very good link with the United States. English is the common language and both countries share the same time zone. So many American companies opt for Trinidad as the cheap manufacturer in preference to Southeast Asia.?
*****************************
DOMESTIC U.S. FREE TRADE ZONES
Inside the U.S., there are 100?s of them, the following is right from a web page in Florida
Foreign or "free" trade zones are secured areas considered to be legally outside a nation?s customs territory, although physically located within it.
They are usually in or near Customs ports of entry, at industrial parks, or terminal warehouses facilities.
Foreign exporters planning to expand or open up new US outlets may forward their goods to a foreign trade zone in the US.
It can be held there for an unlimited period while awaiting a favorable market in the US or nearby countries, without being subject to customs entry, payment of duty or tax, or bond. However, Federal laws are applicable to products, such as the Federal, Food, Drug, and Cosmetic Act.
Merchandise lawfully brought into these zones may be stored, sold, exhibited, broken up, repacked, assembled, distributed, sorted, graded, cleaned, mixed with foreign or domestic merchandise, or otherwise manipulated or manufactured.
The goods may be transferred into a customhouse after being processed.
There are many advantages and uses of Foreign Trade Zones.
Among them:
? You can release your goods according to market demand or a favorable change in duty rates.
? You can save on transport costs by shipping goods to the FTZ in bulk and repacking or assemble them there. Goods may even be processed and upgraded to meet requirements of federal regulatory agencies. Goods may be labeled following US specifications.
? Goods in excess of quotas may be held in the zone until the next quota period.
? A sample of your product can be withdrawn from the zone and forwarded to Customs for a classification ruling, thus avoiding possible disputes over the classification of the product.
? You can borrow money on the goods stored in the zone, using negotiable warehouse receipts as collateral.
? You may exhibit goods for an unlimited period without bond. You can establish showrooms either on your own or join with other importers in displaying merchandise in a permanent exhibit in the zone.
? Merchandise may be withdrawn from a zone for exhibition at a trade fair without payment of duty or taxes for three months.
? Your goods are under federal protection ?it is a federal offense to steal from a FTZ.
? Goods in an FTZ may be exported to another country without your having ever paid duty on them.
? You do not have to complete your invoices until your goods are sold, so that you do not have to show the sale in your books until it is actually made. Thus, you may be able to postpone taxes to another period that is more to your advantage.
General information on US Foreign Trade Zones may be obtained from the Foreign Trade Zones Board, Department of Commerce, Washington, DC 20230.
Questions relating to legal aspects of Customs Service responsibilities in regard to foreign trade zones should be addressed to Chief, Entry Rulings Branch, US Customs Service, 1301 Constitution Avenue, NW Washington, DC 20299.
You may purchase the Foreign Trade Zones Manual for grantees, operators, users, and Customs brokers from the Superintendent of Documents, US Government Printing Office, Washington, DC 20402. Refer to GPO stock No. 048-002-00111-7 and Customs Publication No. 559.
In Florida there are several Foreign Trade Zones:
# 32 Miami Free Zone Corporation
2305 N.W. 107th Ave., Miami, FL 33172
Tel. (305) 592-4300 Fax: (305) 591-1808
The trade zone has 51 acres, 625,000 square feet of warehouse space in two buildings, 140,000 square feet for office or showroom space, and a trade center for distribution to South America, Central America and the Caribbean.
#64 Jacksonville Trade Zone
2831 Talleyrand Ave., Jacksonville FL 32206-0005
Tel. (904) 630-3053/ 1-800-874-8050 Fax: (904) 630-3011
It has 147 acres at Jacksonville International Airport, 54 acres of warehouse. It also has rail, ocean carrier and interstate access. Sponsored by the Jacksonville Port Authority.
# 65 Panama City Trade Zone
P.O. Box 15095, Panama City, FL 32406
Tel. (904) 763-8471 Fax (904) 769-5673
It has 15,092 square feet of general purpose warehouse space and 58,481 square feet outside general purpose space. Additional space is available at the Bay Industrial Park, Hugh Nelson Industrial Park and Port Panama City Industrial Park. Sponsored by Panama City Port Authority.
# 135 Palm Beach County Trade Zone
P.O. Box 9935 Palm Beach, FL 33419
Tel. (561) 842-4201
Sponsored by the Port of Palm Beach District
#198 Volusia and Flagler Counties Trade Zone
c/o Daytona Beach International Airport
700 Catalina Dr. Suite 300, Daytona Beach Fl 32114
Tel. (904) 248-8030 Fax (904) 248-8038
Sponsored by the County of Valusia, Fl
From South Dakota
South Dakota Companies Outside the Boundaries of Sioux Falls Zone
While it is easier and less expensive for a company to receive FTZ benefits within Sioux Falls area sites, any company in South Dakota can apply to the U.S. Department of Commerce for subzone status.
South Dakota International Business Institute and Sioux Falls Development Foundation will gladly assist you in securing FTZ space within the Sioux Falls area sites or with a subzone application.
Foreign-Trade Zone Advantages
1. Cash Flow - Customs duties are paid only when imported merchandise is shipped into the U.S. Customs territory. Merchandise may be held in inventory in the FTZ without Customs duty payment.
2. Merchandise Processing Fee - Fees are owed only when and if merchandise is transferred to the U.S. Customs territory.
3. Harbor Maintenance Fee - Fees are paid quarterly on merchandise received in the FTZ.
4. Exports - No customs duties are paid on merchandise exported from a FTZ. While drawback law allows the recovery of Customs duties previously paid after the merchandise is exported, payments may be delayed for a variety of reasons. In a FTZ, the duties are simply never paid.
5. Defects/Damage/Obsolescence/Waste/Scrap - Customs duties are significantly reduced or eliminated on merchandise subject to these accountable losses.
6. Inverted Customs Duty Savings - In a FTZ, uniquely, the FTZ user may elect to pay the duty rate applicable to either component materials or the finished merchandise produced from the component material, depending upon which is lower. Many articles have different duty rates for component materials and finished merchandise, offering substantial Customs duty savings.
7. Nondutiability of Labor, Overhead and Profit - Customs duties are not owed on labor, overhead and profit attributed to production operations in a FTZ. If the same production operations were done overseas, the value of the labor, overhead and profit would be subject to U.S. Customs duty. The substantial Customs duties savings may create additional incentives to undertake activity in the United States rather than in a foreign country.
8. International Returns - A number of firms that export have a percentage of the exports returned to the United States. Customs duties are owed each time merchandise of foreign origin that has not been registered with Customs is returned. This further avoids the problem of American Goods Returned that are not American. By being returned to a FTZ, no Customs duties are paid upon return.
9. Spare Parts - To service many products, spare parts must be on hand in the United States for prompt shipment. However, it is impossible for most firms to know the requirements for spare parts, especially in the start-up mode. Spare parts may be held in the FTZ without Customs duty payment, generating cash flow savings. If it is determined that the spare parts are not needed, they may either be returned to the foreign vendor free of duty or destroyed, avoiding Customs duties.
10. U.S. Quota - Most merchandise may be held in a FTZ, even if it is subject to U.S. quota restriction. When the quota opens, the merchandise may be immediately shipped into U.S. Customs territory. Voluntary restraint and orderly marketing agreements are not impacted by FTZ use.
11. Quota Avoidance - Quota merchandise may be substantially transformed in a FTZ into a non-quota article that may be entered into the U.S. Customs territory free of quota restrictions.
12. Simplification of Import/Export Procedures - Delays relating to Customs clearances and duty drawback procedures are eliminated. Cash flow savings accrue as well from simplification of these products.
13. Quality Control - The FTZ may be used for quality control inspections to insure that only merchandise that meets specifications is imported and duty paid. All other materials may be repaired, returned to the foreign vendor, or destroyed under Customs' supervision.
14. Country-of-Origin Marking/Labeling - No country-of-origin labels are required on merchandise admitted to the FTZ. Merchandise shipped into U.S. Customs territory must have appropriate labeling which will vary depending on the circumstances.
15. Security - The FTZ is subject to U.S. Customs Service supervision and security requirements. Unauthorized withdrawal of merchandise, such as employee pilferage or stealing, is a violation of 19 U.S.C. 549, carrying a penalty of two (2) years in a federal penitentiary and a $5,000 fine per offense. Many firms have found the security and federal penalty provisions to be of substantial benefit.
16. Inventory Control - Operations in a FTZ require careful accounting of receipt, processing and shipment of merchandise. Firms have found that the increased accountability cuts down on inaccurate inventory, receiving and shipping concerns, and waste and scrap.
17. Consumed Merchandise - Merchandise consumed in processing in a FTZ generally is not subject to U.S. Customs duties.
18. Production Equipment - Production equipment and components thereof may be admitted to a zone without depositing Customs duties until the time it is completely assembled, installed, tested and used in full-scale production.
19. Entireties Provision - An importer can choose whether or not the entireties provision is applicable to merchandise admitted to or withdrawn from a foreign trade zone.
20. Exhibition - Merchandise may be held for exhibition without Customs duty payment.
21. Reduced Insurance Costs - The insurable value of merchandise held in a FTZ need not include the Customs duty payable on the merchandise. Therefore, insurance costs will be less.
22. Cargo Insurance - Some users of FTZ's have negotiated up to a 40% reduction in cargo insurance rates because imported merchandise is shipped directly to a FTZ without the opportunity for potential pilferage at deepwater ports or major international airports.
23. Zone-to-Zone Transfer - An increasing number of firms are making use of the ability to transfer merchandise from one zone or subzone to another. If the transfer of the merchandise is in-bond, Customs duty is not owed until the product is finally shipped into the U.S. Customs territory. A number of suppliers of materials, components and subassemblies store or produce a product in one zone and ship it to their customer that incorporates the merchandise into a final product, in many instances having a lower duty rate than the duty rate of the materials, components or subassembly produced in the first FTZ. In this manner, the supplier totally avoids Customs duties.
***************************
The Front
Losing Jobs to 936
AMID THE POSTURING and pontificating in the U.S. Congress this summer over the budget reconciliation process, lawmakers passed restrictions on what Senator David Pryor, D- Arkansas, calls
"the Mother of All Tax Shelters:" Section 936 of the Internal Revenue Code.
But the changes are too little, too late for the 483 workers laid off in May 1993 when Acme Boot closed its Clarksville, Tennessee plant. These workers are only a few of the nearly 24,000 in the mainland United States who have lost their manufacturing jobs due to Section 936, according to a recent study by the Midwest Center for Labor Research (MCLR).
Also known as the Possessions Tax Credit, Section 936 exempts U.S. corporations from paying federal income tax on profits generated by a qualified Puerto Rican subsidiary at the cost of $3 billion a year to the U.S. Treasury and at the expense of high-wage jobs in the mainland United States.
Yet the extent to which Section 936 benefits the Puerto Rican economy is questionable. Companies accounting for 12.6 percent of Section 936- related employment received 63.5 percent of the loophole?s benefits, according to the April 1993 testimony of Samuel Sessions, Deputy Assistant Secretary of the U.S. Treasury.
The pharmaceutical industry alone - including Pfizer , Merck and American Home Products - reaped a tax benefit of $66,281 per Puerto Rican employee in 1989, according to the U.S. Treasury Department.
With such a tax break, says Richard Leonard, director of special projects for the Oil, Chemical and Atomic Workers Union (OCAW), "mainland U.S. workers could work 80 hours a week for nothing and would not come close" to competing on wages with jobs in Puerto Rico.
Congress, in its 1993 budget, placed caps on how much profit corporations can exempt under Section 936. Corporations must now choose between an income-based limit (60 percent now, to be phased down to 40 percent by 1998) on their tax exemption or a limit based on a fixed percentage of the credit allowed currently under 936 rules.
The Puerto Rico/USA Foundation, a Washington, D.C.-based membership organization of 70 manufacturing corporations, financial institutions and other businesses with operations in Puerto Rico related to Section 936, says the congressional action "is an improvement to the approach originally taken by the Clinton Administration and the House of Representatives," but "represents a substantial reduction in the economic incentive" for U.S. companies to locate in Puerto Rico.
But Leonard of the OCAW, whose members have lost thousands of jobs due to Section 936, says that the new rules will affect only a few dozen of the more than 500 U.S. corporations benefiting from the tax break. "Most corporations, including Acme Boot Company, won?t be affected - the caps will end only the worst abuses of the largest corporations, particularly pharmaceuticals, which have enormous intangible assets" currently sheltered under 936.
The OCAW favored a runaway plant bill introduced by Representative George Miller, D-California, that would restrict Puerto Rico from granting to any company any incentive that would have an adverse effect on a related mainland enterprise. This is the "ideal way" to go about protecting mainland jobs, says Leonard, because it gives workers and communities cause of action to sue runaway corporations in federal court.
The provision would let the Puerto Rican government off the hook as long as it secures an annual statement of compliance from corporations to which it grants local tax breaks. Congress did not enact any of several proposed runaway plant provisions.
MCLR?s The Impact of Internal Revenue Code Section 936 on Manufacturing Jobs in the United States identifies 50 cases - involving 23,664 jobs at a total of 59 plants - of layoffs and major plant closings in which work was transferred to U.S. possessions.
California was the state hardest hit with 4,295 job losses at 10 locations, followed by Pennsylvania (3,660 jobs), New Jersey (3,450 jobs) and Maine (2,515 jobs). Most of the jobs were directly shifted to Puerto Rico.
The majority of those job losses have occurred since 1985, although some of the cases occurred in the 1970s (36 of the 50 cases occurred within the 1985-1993 time period).
Although Congress enacted Section 936 in 1921, the loophole became more popular as a result of the Tax Reform Act of 1986 and new Puerto Rican laws granting local tax exemptions. The 1986 Act created a "twin plant" initiative, allowing U.S. subsidiaries in Puerto Rico to shelter investments in "twin" plants in certain Caribbean countries.
By 1992, U.S. corporations had established 50 twin plants in the Dominican Republic largely due to geographical proximity and low-wage labor (available at approximately 40 cents per hour).
The MCLR report, commissioned by the OCAW, estimates that as a result of the 23,664 jobs lost directly because of Section 936, an additional 56,342 mainland workers lost their jobs due to a ripple effect. A total of 80,006 job lossess - direct and indirect - have cost local, state and federal governments between $71 and $94.7 million in the form of fewer taxes collected, reduced business taxes and increased social benefits for workers, including unemployment compensation, welfare and food stamps. The report offers a profile of the circumstances of each of the cases cited.
Workers at Acme Boot Company became the latest to suffer the impacts of a runaway corporation when Acme closed its Clarksville, Tennessee bootmaking plant in May 1993.
Acme began hiring workers for its new Puerto Rican facility in January 1993. The United Rubber Workers (URW), which represented workers at the Tennessee Acme plant, petitioned the Puerto Rico Office of Industrial Tax Incentives for a hearing on the granting of local tax breaks necessary to obtain the larger breaks from Section 936. A few weeks before the hearing and just one day after a network television producer expressed interest in the story, Acme withdrew its tax exemption petition.
The company is, however, free to reapply for the tax breaks at any time in the future. The URW has called for a boycott of Acme products including Acme, Dingo and Dan Post boots.
Workers at the American Home Products (AHP) facility in Elkhart, Indiana managed to win some compensation from the corporation after it closed the Elkhart facility in November 1991, transferring approximately 500 jobs directly to Puerto Rico.
AHP, manufacturer of over-the-counter medications and other health care products, including Advil, Anacin and Dristan, opened a plant in Guayama, Puerto Rico in 1988 and began moving packaging lines and other equipment there from the Elkhart facility [see "American" Home Products Moves Abroad, Multinational Monitor, April 1991].
The OCAW filed a class action suit on behalf of the laid-off workers. AHP settled in July 1992 when, five days before the trial, it agreed to pay its former employees $24 million - the first settlement made in a 936 runaway plant case. Yet, according to AHP?s 1991 Annual Report, the company saved $105.6 million in taxes - or $75,000 per Puerto Rican employee.
The trend of U.S. corporations transferring manufacturing jobs from the United States to Puerto Rico to take advantage of 936 looks likely to continue unabated. "The fear of getting dragged into court [as prompted under the Miller bill] is probably the most effective way of policing [runaway corporations] - but it is also the least likely to get passed in Washington," says Leonard.
936 funds
Funds deposited by United States-based corporations in the Government Development Bank of Puerto Rico in order to take advantage of Section 936 of the United States Internal Revenue Service Code, under which income derived from sources in Puerto Rico is exempted from United States income taxes. These funds may be used to help finance twin plant ventures with countries that have signed a bilateral tax information exchange agreement with the United States.
Paris Club
A Paris-based organization that represents commercial banks in the rescheduling of national debts.
San Jos? Accord
An agreement between Mexico and Venezuela--signed in 1980 in San Jos?, Costa Rica, whereby the two oil producers committed themselves to supply crude oil on concessionary terms to ten Central American and Caribbean nations.
terms of trade .
Number of units that must be given up for one unit of goods received by each party, e.g., nation, to a transaction. The terms of trade are said to move in favor of the party that gives up fewer units of goods than it did previously for one unit of goods received, and against the party that gives up more units of goods for one unit of goods received. In international economics, the concept plays an important role in evaluating exchange relationships between nations.
twin plant
Productive arrangements whereby two or more producers in separate countries complementarily share the production of a good or service. Under the Caribbean Basin Initiative (CBI--see Appendix B), such arrangements with the government of Puerto Rico potentially benefited from special investment or 936 funds (q.v.). The operations of Twin Plant ventures typically entailed the delegation of assembly or other labor-intensive production stages to plants in a CBI-designated country, from which these semi-finished products would then be shipped duty-free to Puerto Rico for final processing.
World Bank
Internal name used to designate a group of three affiliated international institutions: the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), and the International Finance Corporation (IFC). The IBRD, established in 1945, has as its primary purpose the provision of loans to developing countries for productive projects.
The IDA, a legally separate loan fund administered by the staff of the IBRD, was set up in 1960 to furnish credits to the poorest developing countries on much easier terms than those of conventional IBRD loans.
The IFC, founded in 1956, supplements the activities of the IBRD through loans and assistance designed specifically to encourage the growth of productive private enterprises in the less developed countries.
The president and certain senior officers of the IBRD hold the same positions in the IFC. The three institutions are owned by the governments of the countries that subscribe their capital.
****************
Levi Strauss Shelves More Costly N. American Workers
Emily Hager
NEW YORK, Oct 29 (IPS) - Graciela Hilario, 53, knows that her 20 years of sewing experience are powerless against economic globalisation.
Speaking in Spanish from a telephone at the Levi Strauss sewing plant in San Antonio in the state of Texas she says, ?es muy lamentable?, or, ''it is so sad''. Hilario says she likes her working conditions and her benefits, including three weeks of vacation and health care.
But soon her job will be gone, as negotiators from Levi and the Union of Needletrades, Industrial and Textile Employees (UNITE) begin to hammer out severance packages for workers in San Antonio.
The consequences of free trade hit the American apparel industry hard last month when Levi announced it plans to close its remaining North American facilities, laying off 800 employees in San Antonio and 1,180 in Canada.
The company is moving its operations to free trade zones in Haiti, among other places.
One of the major contrasts between this migration of apparel manufacturing to foreign countries and the shift that occurred within the United States from the north to the south around 1950 is that companies can no longer invest in capital and technological improvements to compete with markets where wages are lower.
The American industry is, in a sense, technologically saturated.
The plant closing comes 130 years after a man named Levi Strauss and his business partner, Jacob Davis, received a patent for a tiny metal grommet that secured the future of America's quintessential jean company.
Katie Otto, a Levi representative, said shuttering the company's remaining North American manufacturing facilities was ?critical to the company's long-term competitiveness,? and said there was no ?apple-to-apple comparison? between savings in production costs in the United States and abroad.
Jean Hervey, the regional director for UNITE in San Antonio, said details about the severance plan would be determined at meetings expected to end in early November.
Hervey said the union was seeking one to three weeks of severance pay for every year of employment, at least six months of paid medical benefits and additional funds for new job training and education.
Levi has said it will contribute 700,000 U.S. dollars to help workers prepare for new jobs or start businesses of their own. The company has also contracted a firm to provide English classes and a variety of 12- to 18-month job-training courses.
Despite these potential benefits, many Levi sewers, whose average age is 45 and who have worked for the company for over 10 years, worry they will not qualify for new jobs in the car and aerospace industries that are replacing San Antonio's apparel industry.
Vulema Duran, a member of UNITE and a 15-year veteran at Levi, said she appreciated the anticipated severance package but that it is incomplete and she would rather just keep her job.
Speaking in Spanish, Duran told IPS she hopes part of the severance package will guarantee jobs for Levi workers at a new Toyota plant in San Antonio. Toyota broke ground for the facility Oct. 17.
The plant will add more than 2,000 jobs in San Antonio, said Ramiro Cavazos of San Antonio's Economic Development Department, adding it was ?a given? that aerospace and automotive industry jobs would pay wages comparative to those at Levi.
The average wage at the jeans-maker is 14 dollars an hour, while starting wages at Toyota are 16 dollars.
But in an interview, Cavazos added that 25 percent of new Toyota employees have college degrees. ?It's going to take a lot of effort and desire on (the Levi workers') part,? he said, to qualify for the positions.
Duran, who as a girl assembled car radios in Mexico before immigrating to the United States, said she hopes to find work on Toyota's assembly lines. Yet she is still ?enojada? -- angry.
She said that when Levi representatives announced the plants' closing in September, workers were told they would not receive their share of annual profits, which traditionally have come in the form of December bonuses.
Duran stressed that Levi's CEO Phil Marineau's 2002 compensation includes 22.5 million dollars in incentive pay and a 1.3-million-dollar bonus, in addition to his 1.2-million-dollar salary. On the other hand, workers who have literally been sewing the company together all year, will receive pink slips for Christmas.
David Ranney, associate fellow at the Institute for Policy Studies in Washington, D.C., says Levi could not compete with such rivals as the Gap and Tommy Hillfiger if it continued manufacturing in the United States because cheaper foreign labour has lowered its competitors' production costs.
?Workers in apparel have been badly served by NAFTA's undermining regulation and failure to include adequate labour and human rights standards,? Ranney said, referring to the North American Free Trade Agreement between the United States, Mexico and Canada..
Levi's move to Haiti comes at a time when worker's rights violations in third-world manufacturing facilities are being reported.
A Haitian advocacy group, Groupe d'Appui aux Rapatries et Refugies, reported earlier this year that 300 workers have been prevented from unionising in the country by Grupo M, a Dominican apparel company that hired them to assemble Levi products in a new Haitian free-trade zone near Maribahoux, Ouanaminthe.
On Oct. 9 the World Bank approved a 20-million-dollar loan to Grupo M to continue building manufacturing facilities in the Ouanamithe zone contingent on a finding that the allegations are proven to be unfounded.
The loss of manufacturing jobs in the United States and allegations of unfair labour practices occur against the backdrop of the final phase of negotiations for the Free Trade Agreement of the Americas (FTAA), set for November in Miami.
The FTAA would expand NAFTA to every country in Central America, South America and the Caribbean, except Cuba. Negotiations began when NAFTA was launched in 1994 and are expected to be completed in 2005.
The FTAA has come under strong fire from a cross-section of America. In September, a caravan called the ?March to Miami? departed from Seattle for the Florida state city. Aboard were clergy, farmers, workers, environmentalists, union leaders and human rights activists. The march had a single message: ?Stop the FTAA?.
John Campbell, an executive board member of United Steel Workers of America, Local 310, has worked 15 years at the Firestone plant in Des Moines. ?The spirit of democracy is alive and well,? he says, ?and that spirit is not consistent with these trade agreements.?
On the other hand, Jorge Pinto of Pace University's Lubin School of Business, said in an interview, ?Free trade has enormous consequences, but it is the best option for the United States and Latin America to compete with economies in Asia and Europe.?
Until the debate or agreement is settled, Graciela Hilario, the experienced and talented Levi seamstress in San Antonio, says she will focus on her work and try to pretend that nothing has happened. But deep down she knows that America's apparel industry is nearly extinct. (END/2003)
More coming up!
Ok, 1st Welcome to DR1!!!!
I'm going to move this to the Business Forum.
That said.
I Moderate the Living Forum.
My handle is Timex, my name is Tim H.
I live 15min, outside of the Capital.
Your asking about a Free Trade Zone?
BizWiz, I have not recived 1 e-mail or pm from you. :ermm:
I couldn't agree more! Free Trade! But it's not just China, it's the whole dam World, Mexico-India-The Banana Republics, the Caribbean?s, and so-on & so-on.
NO WORKERS COMP, OSHA, EPA, HAZMAT,UN-EMPLOYMENT INSURANCE, LIABILITY INSURANCE, FAMILY MEDICAL LEAVE ACT.
And everything else that can put a guy out of business. Like Law-suits for age/race/sex discrimination.
20 years ago, the largest job market in NY was manufacturing, today it's one of the smallest, under 400,000 people employed in this field for the year 2000.
I am in the Dominican Republic working for an American company. In a Free Trade Zone. The people I pass on my way to work......
Cutler Hammer, AVON, Allen Bradley, G.E. power equipment, Johnson & Johnson, TYCO INDUSTRIES.And many others, in this park established by the AMERICAN CHAMBER OF COMMERCE, yep my tax dollars were hard at work all those years.
Most of these companies have 500 to 800 employees, earning about $150. @ Month for a machine operator, operating machines like chip shooters, for manufacture of PC-boards for INTEL, and Wave Solder machines, assembly people earn a little less.
And while the economy has collapsed here in the last 2 years, and their version of the Federal Reserve( BANCO CENTRAL) is down to 75 million, in U.S. dollars, guess who came to the rescue with a loan for 1.25 Billion dollars??? WITH NO HOPE OF EVER SEEING IT BACK! George Bush & the IMF. Again there are soooo busy with those U.S.tax dollars, they can just add it onto the 87 billion they are taking out of future taxes for rebuilding Iraq.
As I work here, and my weekly paycheck is direct deposited from HQ in NY, to my NY bank account. I still pay S.S. and Medicare, but $0 on the State & Federal, because I am working outside the U.S. 320 days a year.
I have received allot of request's about this. Below is a portion of the IRS 593, (2555-EZ)exemption. At the bottom is a link for the full publication. As always, consult a professional for your tax advice, I did this, just out of courtesy.
Full Text
Scroll down to Publication 593
http://www.irs.gov/formspubs/lists/0,,id=101466,00.html
I still file my State & Federal Taxes every year, but the 1st $ 80,000. comes right off the top. Then I start getting taxed like I was living in NY.
When I run out of deductions, (ie: home owner, kids, travel for work.), and I see, I am starting to pay too much, I shift the balance of my pay to this side.
****************************************
1 company made of 2 parts.
Part 1 USA.
Has a large engineering staff, all disciplines 70 people.
Has a purchasing, logistics, and shipping department, 10 people.
Has a ware-house for out going ,incoming materials and merchandise, 20 people.
Has a small engineering rework department, 20 people.
Has an international sales staff of 30.
And the rest that would make up management.
These people are very well paid, have stock options, and the median for time employed is 15 years, better than most companies.
Everything needed for manufacturing, must be shipped by Part 1, to Part 2, by ocean going container, 2 containers a week leave the USA with raw materials. 2 containers a week arrive with finished goods. Machinery must be shipped in from Part 1, in the USA, to Part 2. Old equipment must be shipped back to the states, there is no exceptions to these rules. I can not sell an old chip shooter, or dispose of it in any way, here. That could cause an unfair advantage with the local manufacturers, who compete here and also ship goods to the states.
Logistics.
At all times, there are 2 containers in NY, being loaded.
There are 2 containers on the pond, on their way to NY, with finished goods.
There are 2 containers on the pond, on their way here with raw materials.
There are 2 containers here being loaded, with finished goods, to ship.
All containers are loaded and locked, at their perspective loading docks, and bypass the usual customs inspections. Once in awhile they are inspected, far and few in-between.
$ 300,000. of raw materials arrive every week.
$ 1,000,000. of finished goods, ship every week.
All assets, capital equipment, loss & depreciation, labor, utilities, property lease, are treated tax wise, as if being manufactured in the facility, in NY.
PART 2
My Company is a Fortune 500 and in this location.
And outside of the weekly payroll, we pay almost 800 people weekly, not bi-weekly like most do. The electric bill is our highest expense. We run 7 disciplines of manufacturing under 1 roof.
We have,
A Metal shop with a 60 Ton CNC Turret Punch Press, 15 OBI Punch Presses, 4 Guillotines, for cutting to size, 4 Brake presses for small runs. Also in there is 8 industrial Spot Welders, busy all day long.
Then there is a Powder Coating line with Wash Down and Drying Ovens all on a continuous conveyer.
We have a Printing Dept, that cuts and prints every thing from Packing boxes, Merchandise boxes, Instructions, every single piece of cardboard and paper we use.
The PCB Department, 10 lines of CNC Circuit board, component placement machines (Chip-Shooters), that to feed Wave solder?s. We go to 06/03, that would be .060 X .030, sized components, surface mounted.
A Microwave & RF assemby dept, for wireless communication devices.
A Molding Dept, 12 Injection molding machines, what doesn?t go in metal, goes in plastic.
A huge Assembly Dept, where all of the stuff is made into final finished goods.
This is all suported by a central Engineering and QC Departments.
We are now ISO 9002.
A Maintenance Dept, to support the auxilleries and each department.
Four 50Hp Air compressor?s, Two 50Hp Vacuum generators, and Four 3000Kw Standby Generators.
I have not seen such a variety of Engineering Disciplines, under 1 roof, anywhere else in the DR, yet. I?m still looking.
Labor Costs
Locale employees in the Free Trade Zone, earn 30% above their counterparts outside the AFTZ.
The average salary, for a technical operator( CNC chip shooter), maintenance man, machinist, is between $8,000. to $12,000. pesos @ month. $200 to $300 US dollars @ month.
A good department manager $20,000. to $30,000. pesos @ month. $500 to $750. @ month U.S.
A Section Leader, we have 7, about $50,000. pesos @ month. $1250 @ month U.S.
These salaries are 30% or more in difference outside the AFTZ.
1 example would be, an operator, at Magnachem, a Glaxo-Wellcome, pharmaceutical subsidiary, that did not set up in the Free Trade Zone, gets paid $2500. pesos @ month,
or $62. U.S. @ month.
Manufacturing outside the FTZ, allows you to market you goods, locally on the Island.
We can not.
The Free Trade Zone, is exempt for most locale laws and restrictions. It is treated like an Embassy, it has sovereignty recognition of its SPONSER
This island has over 50 Free Trade Zones. AFTZ (USA), Zona Franca (France), Zona Oriental (China), and so on, and so on.
Below is cut and pasted from this web site. If they don't work for you, let me know.
**************
WORKING IN THE DR / AND WORK RESOURCES.
*CLICK ON THE LINK BELOW TO VIEW*
*GETTING DOWN TO WORK!*
A GREAT 1 page primer, too read before the search for WORK.
*FREE TRADE ZONE LIST*
17 PAGES IN PDF FORMAT, BROKEN DOWN BY
FREE ZONE PARK-COMPANY-CONTACT- PHONE/FAX-EMAIL- ACTIVITIES
*NATIONAL FREE ZONES COUNCILE*
WEB SITE FOR THE D.R. GOVERMENT CNZFE.
If you have the labor cost, stuck in you head, please note the following.
The Pesos, is valued at the amount of U.S. Dollars, in reserve at the Banco Central.
From 1993 to December 2001, the peso, was rock solid at 16 to 1, U.S. dollars.
Since January 2002, the Newly Elected Government, has emptied the Central Bank (their Federal Reserve) from 2 Billion U.S. dollars, reserve, to 78 Million U.S. dollars reserve.
The Islands biggest bank has collapsed, and the peso has gone from $16 to 1, all the way to $40 to 1, U.S. dollars. Had been forecasted to go to $50 to 1, by January, by many, many Talking Heads!!!!
The problem, the more U.S. dollars that leave the Banco Central, the further the pesos slide.
As the peso has fallen over 100%, electric, gas, propane, food, has risen accordingly.
But salaries, have only grown 3 to 4% from the before era to now.
*******************************************
FOREIGN FREE TRADE ZONES
Benefits for location in a Free Trade Zone.
Passed in 1998 New Free Zone legislation, by the U.S. Congress.
100% exemption on import duties on raw materials, equipment, parts, components, samples and capital goods necessary for the production of the final product.
-100% exemption of taxes on remittances abroad
-100% exemption on export taxes
-100% exemption on sales tax of local purchases
of goods and services
-100% of municipal and capital taxes
-Exemption from import duties on vehicles necessary for operation
-No restrictions on capital repatriation
-No restrictions on sales to local exporters
-Companies may sell production in local market
-Management of foreign currency with complete independence from the local banking system
-Underdeveloped areas get additional benefits
Back in the Middle Ages the ports along the key trading routes were bursting with activity, and the conditions for storing and transshipment of goods played a substantial role in how successful they were.
And all over the world today, similar free-trading zone still exist. But since the middle of the last century a new type of zone has emerged: the export processing zone.
There are more than eight hundred free trade zones around the globe. The exact figure, however, depends on the kind of definition you use.
Free trade zones, in the new concept, are also termed economic zones, areas where export oriented companies that locate there can enjoy favorable terms and conditions.
They are exempted from custom duties and may even benefit from other tax and financial advantages like no income tax, low tax on profits and subsidized building.
The government determines the size of the zone: it could be a warehouse or a factory, an industrial estate or a whole region.
But more important than the numbers is the choice of location itself. They tend to be located in developing countries, particularly in Southeast Asia, Central America and North Africa. Countries where there is a need to boost the economy for their people.
By improving their export position with a free trade zone, a country can attract the kind of business economy that will provide work for its population.
? This happened in Europe at the beginning of the 1960s when Ireland, whose economy was in decline and whose unemployment was high, established a free trade zone. The area around Shannon airport still abounds with call centers and computer companies.?
If you look, for instance, at the Bahamas, you see the country has the highest scores for the tax regime and tax benefits component but scores very low in terms of regional integration and infrastructure.
The Dominican Republic is a very attractive free trade zone from the point of view of labor, pay and infrastructure.
Panama has a fantastic port and Jamaica the best papers in terms of regional integration and trade agreements.?
Singapore is exemplary. The island state has developed into a super hub over the centuries. Despite its size and its home market, Singapore has managed to become a world class transshipment port. Many major company?s have their headquarters there and there are distribution centers that operate all over the world.?
Just look at neighboring Trinidad, which has a very good link with the United States. English is the common language and both countries share the same time zone. So many American companies opt for Trinidad as the cheap manufacturer in preference to Southeast Asia.?
*****************************
DOMESTIC U.S. FREE TRADE ZONES
Inside the U.S., there are 100?s of them, the following is right from a web page in Florida
Foreign or "free" trade zones are secured areas considered to be legally outside a nation?s customs territory, although physically located within it.
They are usually in or near Customs ports of entry, at industrial parks, or terminal warehouses facilities.
Foreign exporters planning to expand or open up new US outlets may forward their goods to a foreign trade zone in the US.
It can be held there for an unlimited period while awaiting a favorable market in the US or nearby countries, without being subject to customs entry, payment of duty or tax, or bond. However, Federal laws are applicable to products, such as the Federal, Food, Drug, and Cosmetic Act.
Merchandise lawfully brought into these zones may be stored, sold, exhibited, broken up, repacked, assembled, distributed, sorted, graded, cleaned, mixed with foreign or domestic merchandise, or otherwise manipulated or manufactured.
The goods may be transferred into a customhouse after being processed.
There are many advantages and uses of Foreign Trade Zones.
Among them:
? You can release your goods according to market demand or a favorable change in duty rates.
? You can save on transport costs by shipping goods to the FTZ in bulk and repacking or assemble them there. Goods may even be processed and upgraded to meet requirements of federal regulatory agencies. Goods may be labeled following US specifications.
? Goods in excess of quotas may be held in the zone until the next quota period.
? A sample of your product can be withdrawn from the zone and forwarded to Customs for a classification ruling, thus avoiding possible disputes over the classification of the product.
? You can borrow money on the goods stored in the zone, using negotiable warehouse receipts as collateral.
? You may exhibit goods for an unlimited period without bond. You can establish showrooms either on your own or join with other importers in displaying merchandise in a permanent exhibit in the zone.
? Merchandise may be withdrawn from a zone for exhibition at a trade fair without payment of duty or taxes for three months.
? Your goods are under federal protection ?it is a federal offense to steal from a FTZ.
? Goods in an FTZ may be exported to another country without your having ever paid duty on them.
? You do not have to complete your invoices until your goods are sold, so that you do not have to show the sale in your books until it is actually made. Thus, you may be able to postpone taxes to another period that is more to your advantage.
General information on US Foreign Trade Zones may be obtained from the Foreign Trade Zones Board, Department of Commerce, Washington, DC 20230.
Questions relating to legal aspects of Customs Service responsibilities in regard to foreign trade zones should be addressed to Chief, Entry Rulings Branch, US Customs Service, 1301 Constitution Avenue, NW Washington, DC 20299.
You may purchase the Foreign Trade Zones Manual for grantees, operators, users, and Customs brokers from the Superintendent of Documents, US Government Printing Office, Washington, DC 20402. Refer to GPO stock No. 048-002-00111-7 and Customs Publication No. 559.
In Florida there are several Foreign Trade Zones:
# 32 Miami Free Zone Corporation
2305 N.W. 107th Ave., Miami, FL 33172
Tel. (305) 592-4300 Fax: (305) 591-1808
The trade zone has 51 acres, 625,000 square feet of warehouse space in two buildings, 140,000 square feet for office or showroom space, and a trade center for distribution to South America, Central America and the Caribbean.
#64 Jacksonville Trade Zone
2831 Talleyrand Ave., Jacksonville FL 32206-0005
Tel. (904) 630-3053/ 1-800-874-8050 Fax: (904) 630-3011
It has 147 acres at Jacksonville International Airport, 54 acres of warehouse. It also has rail, ocean carrier and interstate access. Sponsored by the Jacksonville Port Authority.
# 65 Panama City Trade Zone
P.O. Box 15095, Panama City, FL 32406
Tel. (904) 763-8471 Fax (904) 769-5673
It has 15,092 square feet of general purpose warehouse space and 58,481 square feet outside general purpose space. Additional space is available at the Bay Industrial Park, Hugh Nelson Industrial Park and Port Panama City Industrial Park. Sponsored by Panama City Port Authority.
# 135 Palm Beach County Trade Zone
P.O. Box 9935 Palm Beach, FL 33419
Tel. (561) 842-4201
Sponsored by the Port of Palm Beach District
#198 Volusia and Flagler Counties Trade Zone
c/o Daytona Beach International Airport
700 Catalina Dr. Suite 300, Daytona Beach Fl 32114
Tel. (904) 248-8030 Fax (904) 248-8038
Sponsored by the County of Valusia, Fl
From South Dakota
South Dakota Companies Outside the Boundaries of Sioux Falls Zone
While it is easier and less expensive for a company to receive FTZ benefits within Sioux Falls area sites, any company in South Dakota can apply to the U.S. Department of Commerce for subzone status.
South Dakota International Business Institute and Sioux Falls Development Foundation will gladly assist you in securing FTZ space within the Sioux Falls area sites or with a subzone application.
Foreign-Trade Zone Advantages
1. Cash Flow - Customs duties are paid only when imported merchandise is shipped into the U.S. Customs territory. Merchandise may be held in inventory in the FTZ without Customs duty payment.
2. Merchandise Processing Fee - Fees are owed only when and if merchandise is transferred to the U.S. Customs territory.
3. Harbor Maintenance Fee - Fees are paid quarterly on merchandise received in the FTZ.
4. Exports - No customs duties are paid on merchandise exported from a FTZ. While drawback law allows the recovery of Customs duties previously paid after the merchandise is exported, payments may be delayed for a variety of reasons. In a FTZ, the duties are simply never paid.
5. Defects/Damage/Obsolescence/Waste/Scrap - Customs duties are significantly reduced or eliminated on merchandise subject to these accountable losses.
6. Inverted Customs Duty Savings - In a FTZ, uniquely, the FTZ user may elect to pay the duty rate applicable to either component materials or the finished merchandise produced from the component material, depending upon which is lower. Many articles have different duty rates for component materials and finished merchandise, offering substantial Customs duty savings.
7. Nondutiability of Labor, Overhead and Profit - Customs duties are not owed on labor, overhead and profit attributed to production operations in a FTZ. If the same production operations were done overseas, the value of the labor, overhead and profit would be subject to U.S. Customs duty. The substantial Customs duties savings may create additional incentives to undertake activity in the United States rather than in a foreign country.
8. International Returns - A number of firms that export have a percentage of the exports returned to the United States. Customs duties are owed each time merchandise of foreign origin that has not been registered with Customs is returned. This further avoids the problem of American Goods Returned that are not American. By being returned to a FTZ, no Customs duties are paid upon return.
9. Spare Parts - To service many products, spare parts must be on hand in the United States for prompt shipment. However, it is impossible for most firms to know the requirements for spare parts, especially in the start-up mode. Spare parts may be held in the FTZ without Customs duty payment, generating cash flow savings. If it is determined that the spare parts are not needed, they may either be returned to the foreign vendor free of duty or destroyed, avoiding Customs duties.
10. U.S. Quota - Most merchandise may be held in a FTZ, even if it is subject to U.S. quota restriction. When the quota opens, the merchandise may be immediately shipped into U.S. Customs territory. Voluntary restraint and orderly marketing agreements are not impacted by FTZ use.
11. Quota Avoidance - Quota merchandise may be substantially transformed in a FTZ into a non-quota article that may be entered into the U.S. Customs territory free of quota restrictions.
12. Simplification of Import/Export Procedures - Delays relating to Customs clearances and duty drawback procedures are eliminated. Cash flow savings accrue as well from simplification of these products.
13. Quality Control - The FTZ may be used for quality control inspections to insure that only merchandise that meets specifications is imported and duty paid. All other materials may be repaired, returned to the foreign vendor, or destroyed under Customs' supervision.
14. Country-of-Origin Marking/Labeling - No country-of-origin labels are required on merchandise admitted to the FTZ. Merchandise shipped into U.S. Customs territory must have appropriate labeling which will vary depending on the circumstances.
15. Security - The FTZ is subject to U.S. Customs Service supervision and security requirements. Unauthorized withdrawal of merchandise, such as employee pilferage or stealing, is a violation of 19 U.S.C. 549, carrying a penalty of two (2) years in a federal penitentiary and a $5,000 fine per offense. Many firms have found the security and federal penalty provisions to be of substantial benefit.
16. Inventory Control - Operations in a FTZ require careful accounting of receipt, processing and shipment of merchandise. Firms have found that the increased accountability cuts down on inaccurate inventory, receiving and shipping concerns, and waste and scrap.
17. Consumed Merchandise - Merchandise consumed in processing in a FTZ generally is not subject to U.S. Customs duties.
18. Production Equipment - Production equipment and components thereof may be admitted to a zone without depositing Customs duties until the time it is completely assembled, installed, tested and used in full-scale production.
19. Entireties Provision - An importer can choose whether or not the entireties provision is applicable to merchandise admitted to or withdrawn from a foreign trade zone.
20. Exhibition - Merchandise may be held for exhibition without Customs duty payment.
21. Reduced Insurance Costs - The insurable value of merchandise held in a FTZ need not include the Customs duty payable on the merchandise. Therefore, insurance costs will be less.
22. Cargo Insurance - Some users of FTZ's have negotiated up to a 40% reduction in cargo insurance rates because imported merchandise is shipped directly to a FTZ without the opportunity for potential pilferage at deepwater ports or major international airports.
23. Zone-to-Zone Transfer - An increasing number of firms are making use of the ability to transfer merchandise from one zone or subzone to another. If the transfer of the merchandise is in-bond, Customs duty is not owed until the product is finally shipped into the U.S. Customs territory. A number of suppliers of materials, components and subassemblies store or produce a product in one zone and ship it to their customer that incorporates the merchandise into a final product, in many instances having a lower duty rate than the duty rate of the materials, components or subassembly produced in the first FTZ. In this manner, the supplier totally avoids Customs duties.
***************************
The Front
Losing Jobs to 936
AMID THE POSTURING and pontificating in the U.S. Congress this summer over the budget reconciliation process, lawmakers passed restrictions on what Senator David Pryor, D- Arkansas, calls
"the Mother of All Tax Shelters:" Section 936 of the Internal Revenue Code.
But the changes are too little, too late for the 483 workers laid off in May 1993 when Acme Boot closed its Clarksville, Tennessee plant. These workers are only a few of the nearly 24,000 in the mainland United States who have lost their manufacturing jobs due to Section 936, according to a recent study by the Midwest Center for Labor Research (MCLR).
Also known as the Possessions Tax Credit, Section 936 exempts U.S. corporations from paying federal income tax on profits generated by a qualified Puerto Rican subsidiary at the cost of $3 billion a year to the U.S. Treasury and at the expense of high-wage jobs in the mainland United States.
Yet the extent to which Section 936 benefits the Puerto Rican economy is questionable. Companies accounting for 12.6 percent of Section 936- related employment received 63.5 percent of the loophole?s benefits, according to the April 1993 testimony of Samuel Sessions, Deputy Assistant Secretary of the U.S. Treasury.
The pharmaceutical industry alone - including Pfizer , Merck and American Home Products - reaped a tax benefit of $66,281 per Puerto Rican employee in 1989, according to the U.S. Treasury Department.
With such a tax break, says Richard Leonard, director of special projects for the Oil, Chemical and Atomic Workers Union (OCAW), "mainland U.S. workers could work 80 hours a week for nothing and would not come close" to competing on wages with jobs in Puerto Rico.
Congress, in its 1993 budget, placed caps on how much profit corporations can exempt under Section 936. Corporations must now choose between an income-based limit (60 percent now, to be phased down to 40 percent by 1998) on their tax exemption or a limit based on a fixed percentage of the credit allowed currently under 936 rules.
The Puerto Rico/USA Foundation, a Washington, D.C.-based membership organization of 70 manufacturing corporations, financial institutions and other businesses with operations in Puerto Rico related to Section 936, says the congressional action "is an improvement to the approach originally taken by the Clinton Administration and the House of Representatives," but "represents a substantial reduction in the economic incentive" for U.S. companies to locate in Puerto Rico.
But Leonard of the OCAW, whose members have lost thousands of jobs due to Section 936, says that the new rules will affect only a few dozen of the more than 500 U.S. corporations benefiting from the tax break. "Most corporations, including Acme Boot Company, won?t be affected - the caps will end only the worst abuses of the largest corporations, particularly pharmaceuticals, which have enormous intangible assets" currently sheltered under 936.
The OCAW favored a runaway plant bill introduced by Representative George Miller, D-California, that would restrict Puerto Rico from granting to any company any incentive that would have an adverse effect on a related mainland enterprise. This is the "ideal way" to go about protecting mainland jobs, says Leonard, because it gives workers and communities cause of action to sue runaway corporations in federal court.
The provision would let the Puerto Rican government off the hook as long as it secures an annual statement of compliance from corporations to which it grants local tax breaks. Congress did not enact any of several proposed runaway plant provisions.
MCLR?s The Impact of Internal Revenue Code Section 936 on Manufacturing Jobs in the United States identifies 50 cases - involving 23,664 jobs at a total of 59 plants - of layoffs and major plant closings in which work was transferred to U.S. possessions.
California was the state hardest hit with 4,295 job losses at 10 locations, followed by Pennsylvania (3,660 jobs), New Jersey (3,450 jobs) and Maine (2,515 jobs). Most of the jobs were directly shifted to Puerto Rico.
The majority of those job losses have occurred since 1985, although some of the cases occurred in the 1970s (36 of the 50 cases occurred within the 1985-1993 time period).
Although Congress enacted Section 936 in 1921, the loophole became more popular as a result of the Tax Reform Act of 1986 and new Puerto Rican laws granting local tax exemptions. The 1986 Act created a "twin plant" initiative, allowing U.S. subsidiaries in Puerto Rico to shelter investments in "twin" plants in certain Caribbean countries.
By 1992, U.S. corporations had established 50 twin plants in the Dominican Republic largely due to geographical proximity and low-wage labor (available at approximately 40 cents per hour).
The MCLR report, commissioned by the OCAW, estimates that as a result of the 23,664 jobs lost directly because of Section 936, an additional 56,342 mainland workers lost their jobs due to a ripple effect. A total of 80,006 job lossess - direct and indirect - have cost local, state and federal governments between $71 and $94.7 million in the form of fewer taxes collected, reduced business taxes and increased social benefits for workers, including unemployment compensation, welfare and food stamps. The report offers a profile of the circumstances of each of the cases cited.
Workers at Acme Boot Company became the latest to suffer the impacts of a runaway corporation when Acme closed its Clarksville, Tennessee bootmaking plant in May 1993.
Acme began hiring workers for its new Puerto Rican facility in January 1993. The United Rubber Workers (URW), which represented workers at the Tennessee Acme plant, petitioned the Puerto Rico Office of Industrial Tax Incentives for a hearing on the granting of local tax breaks necessary to obtain the larger breaks from Section 936. A few weeks before the hearing and just one day after a network television producer expressed interest in the story, Acme withdrew its tax exemption petition.
The company is, however, free to reapply for the tax breaks at any time in the future. The URW has called for a boycott of Acme products including Acme, Dingo and Dan Post boots.
Workers at the American Home Products (AHP) facility in Elkhart, Indiana managed to win some compensation from the corporation after it closed the Elkhart facility in November 1991, transferring approximately 500 jobs directly to Puerto Rico.
AHP, manufacturer of over-the-counter medications and other health care products, including Advil, Anacin and Dristan, opened a plant in Guayama, Puerto Rico in 1988 and began moving packaging lines and other equipment there from the Elkhart facility [see "American" Home Products Moves Abroad, Multinational Monitor, April 1991].
The OCAW filed a class action suit on behalf of the laid-off workers. AHP settled in July 1992 when, five days before the trial, it agreed to pay its former employees $24 million - the first settlement made in a 936 runaway plant case. Yet, according to AHP?s 1991 Annual Report, the company saved $105.6 million in taxes - or $75,000 per Puerto Rican employee.
The trend of U.S. corporations transferring manufacturing jobs from the United States to Puerto Rico to take advantage of 936 looks likely to continue unabated. "The fear of getting dragged into court [as prompted under the Miller bill] is probably the most effective way of policing [runaway corporations] - but it is also the least likely to get passed in Washington," says Leonard.
936 funds
Funds deposited by United States-based corporations in the Government Development Bank of Puerto Rico in order to take advantage of Section 936 of the United States Internal Revenue Service Code, under which income derived from sources in Puerto Rico is exempted from United States income taxes. These funds may be used to help finance twin plant ventures with countries that have signed a bilateral tax information exchange agreement with the United States.
Paris Club
A Paris-based organization that represents commercial banks in the rescheduling of national debts.
San Jos? Accord
An agreement between Mexico and Venezuela--signed in 1980 in San Jos?, Costa Rica, whereby the two oil producers committed themselves to supply crude oil on concessionary terms to ten Central American and Caribbean nations.
terms of trade .
Number of units that must be given up for one unit of goods received by each party, e.g., nation, to a transaction. The terms of trade are said to move in favor of the party that gives up fewer units of goods than it did previously for one unit of goods received, and against the party that gives up more units of goods for one unit of goods received. In international economics, the concept plays an important role in evaluating exchange relationships between nations.
twin plant
Productive arrangements whereby two or more producers in separate countries complementarily share the production of a good or service. Under the Caribbean Basin Initiative (CBI--see Appendix B), such arrangements with the government of Puerto Rico potentially benefited from special investment or 936 funds (q.v.). The operations of Twin Plant ventures typically entailed the delegation of assembly or other labor-intensive production stages to plants in a CBI-designated country, from which these semi-finished products would then be shipped duty-free to Puerto Rico for final processing.
World Bank
Internal name used to designate a group of three affiliated international institutions: the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), and the International Finance Corporation (IFC). The IBRD, established in 1945, has as its primary purpose the provision of loans to developing countries for productive projects.
The IDA, a legally separate loan fund administered by the staff of the IBRD, was set up in 1960 to furnish credits to the poorest developing countries on much easier terms than those of conventional IBRD loans.
The IFC, founded in 1956, supplements the activities of the IBRD through loans and assistance designed specifically to encourage the growth of productive private enterprises in the less developed countries.
The president and certain senior officers of the IBRD hold the same positions in the IFC. The three institutions are owned by the governments of the countries that subscribe their capital.
****************
Levi Strauss Shelves More Costly N. American Workers
Emily Hager
NEW YORK, Oct 29 (IPS) - Graciela Hilario, 53, knows that her 20 years of sewing experience are powerless against economic globalisation.
Speaking in Spanish from a telephone at the Levi Strauss sewing plant in San Antonio in the state of Texas she says, ?es muy lamentable?, or, ''it is so sad''. Hilario says she likes her working conditions and her benefits, including three weeks of vacation and health care.
But soon her job will be gone, as negotiators from Levi and the Union of Needletrades, Industrial and Textile Employees (UNITE) begin to hammer out severance packages for workers in San Antonio.
The consequences of free trade hit the American apparel industry hard last month when Levi announced it plans to close its remaining North American facilities, laying off 800 employees in San Antonio and 1,180 in Canada.
The company is moving its operations to free trade zones in Haiti, among other places.
One of the major contrasts between this migration of apparel manufacturing to foreign countries and the shift that occurred within the United States from the north to the south around 1950 is that companies can no longer invest in capital and technological improvements to compete with markets where wages are lower.
The American industry is, in a sense, technologically saturated.
The plant closing comes 130 years after a man named Levi Strauss and his business partner, Jacob Davis, received a patent for a tiny metal grommet that secured the future of America's quintessential jean company.
Katie Otto, a Levi representative, said shuttering the company's remaining North American manufacturing facilities was ?critical to the company's long-term competitiveness,? and said there was no ?apple-to-apple comparison? between savings in production costs in the United States and abroad.
Jean Hervey, the regional director for UNITE in San Antonio, said details about the severance plan would be determined at meetings expected to end in early November.
Hervey said the union was seeking one to three weeks of severance pay for every year of employment, at least six months of paid medical benefits and additional funds for new job training and education.
Levi has said it will contribute 700,000 U.S. dollars to help workers prepare for new jobs or start businesses of their own. The company has also contracted a firm to provide English classes and a variety of 12- to 18-month job-training courses.
Despite these potential benefits, many Levi sewers, whose average age is 45 and who have worked for the company for over 10 years, worry they will not qualify for new jobs in the car and aerospace industries that are replacing San Antonio's apparel industry.
Vulema Duran, a member of UNITE and a 15-year veteran at Levi, said she appreciated the anticipated severance package but that it is incomplete and she would rather just keep her job.
Speaking in Spanish, Duran told IPS she hopes part of the severance package will guarantee jobs for Levi workers at a new Toyota plant in San Antonio. Toyota broke ground for the facility Oct. 17.
The plant will add more than 2,000 jobs in San Antonio, said Ramiro Cavazos of San Antonio's Economic Development Department, adding it was ?a given? that aerospace and automotive industry jobs would pay wages comparative to those at Levi.
The average wage at the jeans-maker is 14 dollars an hour, while starting wages at Toyota are 16 dollars.
But in an interview, Cavazos added that 25 percent of new Toyota employees have college degrees. ?It's going to take a lot of effort and desire on (the Levi workers') part,? he said, to qualify for the positions.
Duran, who as a girl assembled car radios in Mexico before immigrating to the United States, said she hopes to find work on Toyota's assembly lines. Yet she is still ?enojada? -- angry.
She said that when Levi representatives announced the plants' closing in September, workers were told they would not receive their share of annual profits, which traditionally have come in the form of December bonuses.
Duran stressed that Levi's CEO Phil Marineau's 2002 compensation includes 22.5 million dollars in incentive pay and a 1.3-million-dollar bonus, in addition to his 1.2-million-dollar salary. On the other hand, workers who have literally been sewing the company together all year, will receive pink slips for Christmas.
David Ranney, associate fellow at the Institute for Policy Studies in Washington, D.C., says Levi could not compete with such rivals as the Gap and Tommy Hillfiger if it continued manufacturing in the United States because cheaper foreign labour has lowered its competitors' production costs.
?Workers in apparel have been badly served by NAFTA's undermining regulation and failure to include adequate labour and human rights standards,? Ranney said, referring to the North American Free Trade Agreement between the United States, Mexico and Canada..
Levi's move to Haiti comes at a time when worker's rights violations in third-world manufacturing facilities are being reported.
A Haitian advocacy group, Groupe d'Appui aux Rapatries et Refugies, reported earlier this year that 300 workers have been prevented from unionising in the country by Grupo M, a Dominican apparel company that hired them to assemble Levi products in a new Haitian free-trade zone near Maribahoux, Ouanaminthe.
On Oct. 9 the World Bank approved a 20-million-dollar loan to Grupo M to continue building manufacturing facilities in the Ouanamithe zone contingent on a finding that the allegations are proven to be unfounded.
The loss of manufacturing jobs in the United States and allegations of unfair labour practices occur against the backdrop of the final phase of negotiations for the Free Trade Agreement of the Americas (FTAA), set for November in Miami.
The FTAA would expand NAFTA to every country in Central America, South America and the Caribbean, except Cuba. Negotiations began when NAFTA was launched in 1994 and are expected to be completed in 2005.
The FTAA has come under strong fire from a cross-section of America. In September, a caravan called the ?March to Miami? departed from Seattle for the Florida state city. Aboard were clergy, farmers, workers, environmentalists, union leaders and human rights activists. The march had a single message: ?Stop the FTAA?.
John Campbell, an executive board member of United Steel Workers of America, Local 310, has worked 15 years at the Firestone plant in Des Moines. ?The spirit of democracy is alive and well,? he says, ?and that spirit is not consistent with these trade agreements.?
On the other hand, Jorge Pinto of Pace University's Lubin School of Business, said in an interview, ?Free trade has enormous consequences, but it is the best option for the United States and Latin America to compete with economies in Asia and Europe.?
Until the debate or agreement is settled, Graciela Hilario, the experienced and talented Levi seamstress in San Antonio, says she will focus on her work and try to pretend that nothing has happened. But deep down she knows that America's apparel industry is nearly extinct. (END/2003)
More coming up!
Last edited:
Part 2
I?m Back!
I don?t want to lose you guys on the info that?s going to follow, but you need to be able to connect the dots, in order to see the whole picture.
You hear me complain about the IMF, you need to know why, and how all of this is carried out by our U.S. Congress, with our tax dollars.
I know there are millions of conspiracy theories, I wont get into that, and I like things black & white, just the facts.
Organizations to know.
IMF International Monetary Fund.
WB World Bank.
WTO World Trade Organization, created from GATT.
United States Chamber of Commerce, which has a Sub Chamber, the American Chamber of Commerce, Abroad.
Import Administration, a branch of the U.S. Government whose motto on the home web page is???.get this!!!!!!!
IMPORT ADMINISTRATION
Safeguarding American Industries and Jobs against Unfair Trade
The IMF and World Bank, were formed for the purpose of rebuilding and reconstruction of Europe & Japan, after the end WWII.
That was over 50 years ago, and things have changed.
******************************************
IMF Basics
Source: International Monetary Fund
? The International Monetary Fund (IMF) came into existence in December 1945 when 29 countries signed its charter at a conference held at Bretton Woods, N.H. The IMF made its first transactions in 1947.
? The IMF was designed to stabilize international exchange rates and promote foreign exchange cooperation at a time when the gold standard was beginning to fail as a means of stabilizing currency values. (source: IMF) Over the years, the loan-making function of the IMF has increased dramatically. (source: www.britannica.com)
? Structural Adjustment Programs (SAPs): The IMF issues loans designed to help countries restructure their economies to increase exports and draw foreign investment. Countries that take out structural adjustment loans give the IMF influence over their economic policies. Under SAPs, countries often make sharp budget cuts in environmental protection, health, education, and worker protection. (source: Friends of the Earth)
? Current Membership: 182 countries.
? Staff: Approximately 2,700 from 110 countries. Most IMF staff work at IMF headquarters in Washington.
? Acting Managing Director: Stanley Fischer. The managing director is an appointee of the board of executive directors, and chairs the board. Traditionally, the managing director is a European.
? The IMF governmental structure is similar to the World Bank's. Each member nation is represented by a governor. Eight executive directors represent individual countries: China, France, Germany, Japan, Russia, Saudi Arabia, the United Kingdom, and the United States. The remaining 16 executive directors represent groupings of the other 174 countries. As with the World Bank, governors meet once per year and delegate most of their powers to the executive directors.
? On joining the IMF, countries contribute a sum of money, called a "quota," into a common pool from which members may borrow. The amount of a country's quota is determined by its economic strength and in turn determines both how much a country may borrow from the pool and how much voting power it has in the IMF.
? Total Quotas: almost US$300 billion, following a 45 percent quota increase effective January 22, 1999.
? As with the World Bank, the IMF has the philosophy that it is best to reach a consensus without voting whenever possible.
World Bank Basics
Source: The World Bank
? The World Bank was formed at the UN Monetary and Financial Conference held in Bretton Woods, N.H., in 1944, in preparation for postwar international economic cooperation.
? Function: Lending money and funding projects in needy countries to alleviate poverty. Loans are conditioned on fundamental changes to the recipient country's economic and social policies. (Source: American Lands Alliance)
? Current membership: more than 180 countries.
? Staff: approximately 9,500 (Source: American Lands Alliance)
? Headquarters: Washington, D.C.
? The World Bank Group consists of the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the Multilateral Investment Guarantee Agency (MIGA), International Finance Corporation (IFC), and the International Centre for Settlement of Investment Disputes (ICSID).
Governmental Structure
? Each member nation is represented by a governor. The Bank's five largest shareholders -- France, Germany, Japan, the United Kingdom and the United States ? each appoint an executive director. The remaining 175 member countries are represented by 19 executive directors.
? Governors meet once per year and delegate most of their powers to the executive directors.
? The 24 executive directors meet twice a week "to oversee the Bank's business, including approving loans and guarantees, new policies, the administrative budget, country assistance strategies, and borrowing and financial decisions."
? World Bank President: James Wolfensohn. The president chairs meetings of the executive directors and is responsible for overall management of the Bank. The Bank's president is by tradition a national of the largest shareholder: the United States. Wolfensohn serves as president of all five World Bank Group institutions.
Voting
? The seven richest countries (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States), called the G-7, have 45 percent of the voting power.
? Share of voting power is determined by the size of a country's shareholding, which is determined by the size of a country's economy.
? The United States is a 17 percent shareholder, which gives it "power to veto any changes in the Bank's capital base and Articles of Agreement (85 percent of the shares are needed to effect such changes)."
? If necessary, loan approval is decided by "a majority of votes cast by all members."
? According to the World Bank, consensus on decisions is usually reached without voting.
*********************************************
World Trade Org, Basics
Source: WTO
? The World Trade Organization (WTO) describes itself as the only global international organization dealing with the rules of trade between nations. An outgrowth of the General Agreement on Tariffs and Trade, the WTO came into being on January 1, 1995. Its membership includes 144 countries (as of January 1, 2002).
? WTO trade agreements are ratified in member countries' parliaments and serve as the legal ground rules for international commerce.
? The WTO's main functions and goals involve 1) administering and implementing global trade agreements, 2) acting as a forum for multilateral trade negotiations, 3) seeking to resolve trade disputes, 4) overseeing national trade policies and 5) cooperating with other international institutions involved in global economic policymaking.
? The WTO's Committee on Trade and Environment (CTE) was created pursuant to the adoption of the 1994 Ministerial Decision on Trade and the Environment. According to the CTE's mandate, the committee seeks to "identify the relationship between trade measures and environmental measures in order to promote sustainable development."
? The General Council conducts most of the WTO's day-to-day operations of the WTO and, when appropriate, delegates responsibility to three other major bodies (the Councils for Trade in Goods, Trade in Services and Trade-Related Aspects of Intellectual Property Rights). The ministerial conference, which includes all member nations and meets every two years, is the WTO's highest authority.
? The WTO secretariat is located in Geneva, Switzerland and employs a staff of 550 people.
*******************
The United States Chamber of Commerce
Source: U.S. Chamber of Commerce
The idea of a national institution to represent the unified interests of U.S. business first took shape when President Howard Taft, in a speech before Congress on December 7, 1911, addressed the need for a "central organization in touch with associations and chambers of commerce throughout the country and able to keep purely American interests in a closer touch with different phases of commercial affairs."
Four months later, on April 12, 1912, President Taft's vision became a reality when a group of 700 delegates from various commercial and trade organizations came together to create a unified body of business interest that today is the U.S. Chamber of Commerce.
In 1925, construction on the Chamber headquarters was completed on property that had belonged to Daniel Webster, and the U.S. business community made it a rallying point for promoting and defending free enterprise and individual opportunity.
More than 90 years later, the Chamber has grown from an initial membership of 878 to more than 3 million businesses, nearly 3, 000 state and local chambers, 830 associations, and over 90 American Chambers of Commerce abroad.
The U.S. Chamber and the legacy of Daniel Webster share more than just the hallowed ground that is now 1615 H Street Northwest. This venerable institution and this statesman's spirit share an unwavering commitment to democracy, individual opportunity, and free enterprise. They are forever bonded by the words of Webster, which were inscribed in stone in the original Chamber building:
"Let us develop the resources of our land, call forth its powers, build up its institutions, promote all its great interests, and see whether we also, in our day and generation, may not perform something worthy to be remembered." -- Daniel Webster, June 17, 1825, Speech Commemorating the 50th Anniversary of the Battle of Bunker Hill, Charleston, Massachusetts
**********************
The American Chamber of Commerce of the Dominican Republic
Source: A.C.C.A.
Is an organization made up of Dominican and American companies. The Chamber was founded on November 8, 1923 and since then it has developed its services and activities dynamically.
The chamber has a membership of more than 3,300 commercial and professional firms distributed throughout Santo Domingo, and in the 10 provincial offices located in the cities of: Santiago, San Francisco de Macor?s, La Vega, Puerto Plata, Moca, La Romana, Ban?, San Pedro de Macor?s, Barahona and Hig?ey.
Nationally the Chamber is a member of the National Private Enterprise Council (CONEP), of "Acci?n Pro Educaci?n y Cultura, Inc." (APEC) as well as other organizations.
The Chamber is affiliated with the United States Chamber of Commerce, Association of American Chambers of Commerce of Latin America (AACLA) in Washington, D. C., and with the World Trade Center Association in New York.
STRUCTURE AND DIRECTORATE
The Chamber is legally established as a non-profit institution. Its income, deriving mainly from the fees of members and other sources, is dedicated to providing services for its members.
The Chamber has several committees with objectives directed towards the strengthening of free enterprise, investment promotion, community service, improvement of governmental and international relations, and providing services for its members.
The Board of Directors, elected every year, is made up of the Executive Committee, the Directors, past Presidents and Directors representing Provincial Offices.
***************************
IMPORT ADMINISTRATION
Safeguarding American Industries and Jobs against Unfair Trade
Source: Department of Commerce, United States of America.
Foreign-trade zones are designated sites licensed by the Foreign-Trade Zones (FTZ) Board (the Secretary of Commerce is Chairman) at which special customs procedures may be used.
FTZ procedures allow duty-free export and deferral of customs duty payment on items used in domestic commerce, helping to offset customs cost advantages available to plants abroad.
FTZ activity is conducted under the supervision of the Bureau of Customs and Border Protection, Department of Homeland Security.
That?s the cast of players.
Next is Connect the DOTS.
*************************************************
The Modus Operandi for the IMF & World Bank, is laid out in this film review
I posted it, because, this is the best explanation, as to how the 2 organizations, operate, over and over and over.
Now at 1st, I thought some of what I have been posting was BS, I will tell you it?s not.
2nd, What the IMF has done with other countries in the past, Argentina, Venezuela, Mexico, etc, etc.
I am watching happen in front of my own eyes, day to day, right where I live now.
Every day, I can predict what is going to happen with country, based on past events.
What is happening, will not affect me personally, but it is truly incredible to watch it happening, in front of your own eyes.
The U.S. is the biggest player in both organizations, and it receives its yearly quota, of cash contributions, to both organizations, directly from U.S. tax payers, both individual, and corporate.
Next up on the horizon for the IMF & WB,?? IRAQ, think I?m kidding, go check out their web-sites.
As I post this, plans are being drawn up, for more FTZ, constructed along with, new airports/roads/ports, and communication system?s.
Those contracts, and the $ 87 Billion that was just appropriated???A drop in the bucket, compared to what?s coming down the road for Iraq.
All on U.S. Tax dollars.
*************************************************************
Life and Debt: Behind paradise's facadeLife and DebtA film by Stephanie Black
Available on DVD and videotape
If you want to understand the operations of the International Monetary Fund (IMF) and how this and other World Financial institutions condemn Third World countries to permanent underdevelopment and poverty, purchase or see Life and Debt.
The film begins with a group of English tourists, mostly working class, who have scrimped all year to save for a two-week holiday in the sun, arriving in Jamaica. The film takes the viewer beyond the flash hotel rooms and luxurious setting to expose the reality behind the facade: the contents of the toilet are flushed straight into the ocean because there is no sewage treatment plant; the mouth-watering dessert of pineapples and bananas is made from tinned fruit imported from the USA.
The contrast between a ?paradise? of palm trees and beautiful tropical beaches and the reality of run-down schools and a vast slum just behind the hotel is difficult to comprehend.
The complexity that seems to shroud international lending, structural adjustment programs and free trade begins to lift when the impact of these policies is seen in the day-to-day lives of the Jamaican people.
Life and Debt reveals the deliberate destruction of the country's farming sector. Jamaica was self-sufficient in carrots, potatoes, pumpkins and onions, but now much of the land lies abandoned under the impact of forced imports of US agricultural products. The Jamaican milk industry, after 50 years of breeding suitable cattle, has been destroyed, due to cheap imports of powdered milk from the US. Similarly, due to the unfair competition by US-owned Chiquita banana corporation, the number of Jamaican small banana farmers has been slashed from 45,000 to 3000.
The US government is determined to torpedo the agreement between the European Union and Europe's former colonies, using the World Trade Organization. The Loan's Convention provided for a tax-free import quota of 105,000 tones of fruit per year to England from the West Indies. US opposition is specifically directed at protecting US companies, Chiquita and Dole.
Addressing the issue of free trade zones, Life and Debt introduces the viewer to workers employed by US corporations who must sew six days a week to earn the legal minimum wage of US$30 a week. The port of Kingston is lined with high-security factories, made available to foreign garment companies at low rent.
Foreign companies are allowed to bring in shiploads of raw material tax-free, have them sewn and assembled and then immediately transported out to foreign markets. No export tax is paid to the Jamaican government. More than 10,000 women work for these foreign companies and are required to put up with sub-standard work conditions.
The Jamaican government has agreed to the stipulation that no unionization be permitted in the free trade zones.
The film is interspersed with interviews with former Jamaican Prime Minister Michael Manley, who was elected on a non-IMF platform in 1976. He was forced to sign Jamaica's first loan agreement with the IMF in 1977 due to lack of viable alternatives.
At present, Jamaica owes more than $4.5 billion to the IMF, the World Bank and the Inter-American Development Bank, among other international lending agencies, yet the development that these loans ?promised? have failed to eventuate.
One criticism I would offer is that the film tends to paint tourists as the guilty party. Jamaica's situation has little to do with individual Western tourists, many of whom are also the victims of global exploitation, but in different ways.
Life and Debt also presents interviews with the slimy and smarmy IMF deputy director, Stanley Fischer, who spins a tale of the ?benefits? of the loans. Manley confesses that it broke his heart when he had to agree to the IMF loans, as he believed there was no other way out of Jamaica's situation.
The US government, in collusion with the international bankers, forced him out of government in 1978 in a campaign of destabilization. Unfortunately, that fact is not mentioned in the film.
The film's music is terrific, with classic songs by Bob Marley and Harry Belafonte and others. The color-drenched cinematography is also spectacular. The film is based on a book by Jamaica Kincaid, called A Small Place.
While Life and Debt offers few solutions, the problem is depicted in very clear terms. It's obvious the policies of the Western-dominated international financial institutions are deliberately designed to destroy the Third World's home-grown industries, and to benefit the US.
The DVD has bonus features, including additional interview footage of Michael Manley, a commentary by the director and gallery of photos of the anti-globalization movement.
******************
Taken from old posts right on this board!!!!!!!
Thank You to all, who are quoted here!!!!
PM or E-mail me, so I can give proper credit please!
Benefits for the DR.
My dad once said, Life is unfair Tim. I am being underpaid, not by my standards, but by international standards. A NYC Sanitation worker makes more than I do, and I'd like to think I am more qualified. He then said, this is the job I choose. Instead of complaining on how my boss has money for constant vacations and new cars, I am concentrating in either getting a better job and/or developing skills that makes me "more wanted" in my market. (said that to me 28 years ago, when was 12.)
This is a discussion for another time or thread, but the key is education. Why are FTZ employees better paid now than 15 yrs ago? Because they are more qualified now, instead of sewing cheap panties they now assemble complex electronic machinery. We now have technical colleges that turn out brighter, smarter, graduates, with instructors from the U.S.
Us Gringos, want more modern homes, and we need our high speed internet.
Between the Higher educated Dominicans, and us ex-pats, there is a tremendous spread of capital, what the bookends call Trickle Down Economics.
What about the millions of dollars Nike spends on manufacturing, marketing, distributing etc etc. If they didn't have low overheads, they couldn't compete, if they couldn't compete, the ad people, TV commercial producers, warehouse & logistic people, wouldn't have a job.
Welcome to capitalism, it's what puts food in your mouth and clothes on your back. :smoke:
Take a look in your wardrobe, around your house, you may be surprised what multi-nationals you support. What about the computer you?re using? Do you know its origin?
some FTZ statistics
Some statistics from the Free Zone Council (they based this on 2001 numbers, but just released it):
51 Free Zones with 512 companies in the DR.
175,000 directly employed workers in FTZ's in 2001.
26 FTZ's are Privately owned with 226 companies;
22 FTZ's are Publicly owned with 164 companies;
3 FTZ's are Mixed ownership with 91 companies;
there are 31 Free Zone Especiales (basically an area surrounding a company that is then called an FTZ I think.
16 FTZ's have 10 or more companies, and of these, 10 FTZ's are Privately owned and 2 are of Mixed ownership.
16 FTZ's have only 1 company in them.
My company is 1 of these.
Average salaries:
Technicos: RD$1833 per week
Obreros: RD$778 per week
51% of companies are textiles
17% are Services
and then in descending order are:
electronics
tobacco
jewelry
shoes
50% are US owned companies
32% are Dominican owned companies
5% are Korean companies
2% are Puerto Rican companies (they broke this out, not me).
PS- Playing music boosts productivity in assembly type work by 10% - it PAYS to play it!
***************************
Ok, you guy?s have more education, on this, then you will ever need in this lifetime.
So I need to know, are you looking at Manufacturing under the IRS 936 Twin Plant Rule?
Or are you into Importing/Exporting/Sub-contracting, I-Net??????????????
Sub-letting an office?
Is it just something for the 2 of you, or more.
Alot of people, will help you out here, but we need more info.
Thanks
Tim H. :smoke:
I?m Back!
I don?t want to lose you guys on the info that?s going to follow, but you need to be able to connect the dots, in order to see the whole picture.
You hear me complain about the IMF, you need to know why, and how all of this is carried out by our U.S. Congress, with our tax dollars.
I know there are millions of conspiracy theories, I wont get into that, and I like things black & white, just the facts.
Organizations to know.
IMF International Monetary Fund.
WB World Bank.
WTO World Trade Organization, created from GATT.
United States Chamber of Commerce, which has a Sub Chamber, the American Chamber of Commerce, Abroad.
Import Administration, a branch of the U.S. Government whose motto on the home web page is???.get this!!!!!!!
IMPORT ADMINISTRATION
Safeguarding American Industries and Jobs against Unfair Trade
The IMF and World Bank, were formed for the purpose of rebuilding and reconstruction of Europe & Japan, after the end WWII.
That was over 50 years ago, and things have changed.
******************************************
IMF Basics
Source: International Monetary Fund
? The International Monetary Fund (IMF) came into existence in December 1945 when 29 countries signed its charter at a conference held at Bretton Woods, N.H. The IMF made its first transactions in 1947.
? The IMF was designed to stabilize international exchange rates and promote foreign exchange cooperation at a time when the gold standard was beginning to fail as a means of stabilizing currency values. (source: IMF) Over the years, the loan-making function of the IMF has increased dramatically. (source: www.britannica.com)
? Structural Adjustment Programs (SAPs): The IMF issues loans designed to help countries restructure their economies to increase exports and draw foreign investment. Countries that take out structural adjustment loans give the IMF influence over their economic policies. Under SAPs, countries often make sharp budget cuts in environmental protection, health, education, and worker protection. (source: Friends of the Earth)
? Current Membership: 182 countries.
? Staff: Approximately 2,700 from 110 countries. Most IMF staff work at IMF headquarters in Washington.
? Acting Managing Director: Stanley Fischer. The managing director is an appointee of the board of executive directors, and chairs the board. Traditionally, the managing director is a European.
? The IMF governmental structure is similar to the World Bank's. Each member nation is represented by a governor. Eight executive directors represent individual countries: China, France, Germany, Japan, Russia, Saudi Arabia, the United Kingdom, and the United States. The remaining 16 executive directors represent groupings of the other 174 countries. As with the World Bank, governors meet once per year and delegate most of their powers to the executive directors.
? On joining the IMF, countries contribute a sum of money, called a "quota," into a common pool from which members may borrow. The amount of a country's quota is determined by its economic strength and in turn determines both how much a country may borrow from the pool and how much voting power it has in the IMF.
? Total Quotas: almost US$300 billion, following a 45 percent quota increase effective January 22, 1999.
? As with the World Bank, the IMF has the philosophy that it is best to reach a consensus without voting whenever possible.
World Bank Basics
Source: The World Bank
? The World Bank was formed at the UN Monetary and Financial Conference held in Bretton Woods, N.H., in 1944, in preparation for postwar international economic cooperation.
? Function: Lending money and funding projects in needy countries to alleviate poverty. Loans are conditioned on fundamental changes to the recipient country's economic and social policies. (Source: American Lands Alliance)
? Current membership: more than 180 countries.
? Staff: approximately 9,500 (Source: American Lands Alliance)
? Headquarters: Washington, D.C.
? The World Bank Group consists of the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the Multilateral Investment Guarantee Agency (MIGA), International Finance Corporation (IFC), and the International Centre for Settlement of Investment Disputes (ICSID).
Governmental Structure
? Each member nation is represented by a governor. The Bank's five largest shareholders -- France, Germany, Japan, the United Kingdom and the United States ? each appoint an executive director. The remaining 175 member countries are represented by 19 executive directors.
? Governors meet once per year and delegate most of their powers to the executive directors.
? The 24 executive directors meet twice a week "to oversee the Bank's business, including approving loans and guarantees, new policies, the administrative budget, country assistance strategies, and borrowing and financial decisions."
? World Bank President: James Wolfensohn. The president chairs meetings of the executive directors and is responsible for overall management of the Bank. The Bank's president is by tradition a national of the largest shareholder: the United States. Wolfensohn serves as president of all five World Bank Group institutions.
Voting
? The seven richest countries (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States), called the G-7, have 45 percent of the voting power.
? Share of voting power is determined by the size of a country's shareholding, which is determined by the size of a country's economy.
? The United States is a 17 percent shareholder, which gives it "power to veto any changes in the Bank's capital base and Articles of Agreement (85 percent of the shares are needed to effect such changes)."
? If necessary, loan approval is decided by "a majority of votes cast by all members."
? According to the World Bank, consensus on decisions is usually reached without voting.
*********************************************
World Trade Org, Basics
Source: WTO
? The World Trade Organization (WTO) describes itself as the only global international organization dealing with the rules of trade between nations. An outgrowth of the General Agreement on Tariffs and Trade, the WTO came into being on January 1, 1995. Its membership includes 144 countries (as of January 1, 2002).
? WTO trade agreements are ratified in member countries' parliaments and serve as the legal ground rules for international commerce.
? The WTO's main functions and goals involve 1) administering and implementing global trade agreements, 2) acting as a forum for multilateral trade negotiations, 3) seeking to resolve trade disputes, 4) overseeing national trade policies and 5) cooperating with other international institutions involved in global economic policymaking.
? The WTO's Committee on Trade and Environment (CTE) was created pursuant to the adoption of the 1994 Ministerial Decision on Trade and the Environment. According to the CTE's mandate, the committee seeks to "identify the relationship between trade measures and environmental measures in order to promote sustainable development."
? The General Council conducts most of the WTO's day-to-day operations of the WTO and, when appropriate, delegates responsibility to three other major bodies (the Councils for Trade in Goods, Trade in Services and Trade-Related Aspects of Intellectual Property Rights). The ministerial conference, which includes all member nations and meets every two years, is the WTO's highest authority.
? The WTO secretariat is located in Geneva, Switzerland and employs a staff of 550 people.
*******************
The United States Chamber of Commerce
Source: U.S. Chamber of Commerce
The idea of a national institution to represent the unified interests of U.S. business first took shape when President Howard Taft, in a speech before Congress on December 7, 1911, addressed the need for a "central organization in touch with associations and chambers of commerce throughout the country and able to keep purely American interests in a closer touch with different phases of commercial affairs."
Four months later, on April 12, 1912, President Taft's vision became a reality when a group of 700 delegates from various commercial and trade organizations came together to create a unified body of business interest that today is the U.S. Chamber of Commerce.
In 1925, construction on the Chamber headquarters was completed on property that had belonged to Daniel Webster, and the U.S. business community made it a rallying point for promoting and defending free enterprise and individual opportunity.
More than 90 years later, the Chamber has grown from an initial membership of 878 to more than 3 million businesses, nearly 3, 000 state and local chambers, 830 associations, and over 90 American Chambers of Commerce abroad.
The U.S. Chamber and the legacy of Daniel Webster share more than just the hallowed ground that is now 1615 H Street Northwest. This venerable institution and this statesman's spirit share an unwavering commitment to democracy, individual opportunity, and free enterprise. They are forever bonded by the words of Webster, which were inscribed in stone in the original Chamber building:
"Let us develop the resources of our land, call forth its powers, build up its institutions, promote all its great interests, and see whether we also, in our day and generation, may not perform something worthy to be remembered." -- Daniel Webster, June 17, 1825, Speech Commemorating the 50th Anniversary of the Battle of Bunker Hill, Charleston, Massachusetts
**********************
The American Chamber of Commerce of the Dominican Republic
Source: A.C.C.A.
Is an organization made up of Dominican and American companies. The Chamber was founded on November 8, 1923 and since then it has developed its services and activities dynamically.
The chamber has a membership of more than 3,300 commercial and professional firms distributed throughout Santo Domingo, and in the 10 provincial offices located in the cities of: Santiago, San Francisco de Macor?s, La Vega, Puerto Plata, Moca, La Romana, Ban?, San Pedro de Macor?s, Barahona and Hig?ey.
Nationally the Chamber is a member of the National Private Enterprise Council (CONEP), of "Acci?n Pro Educaci?n y Cultura, Inc." (APEC) as well as other organizations.
The Chamber is affiliated with the United States Chamber of Commerce, Association of American Chambers of Commerce of Latin America (AACLA) in Washington, D. C., and with the World Trade Center Association in New York.
STRUCTURE AND DIRECTORATE
The Chamber is legally established as a non-profit institution. Its income, deriving mainly from the fees of members and other sources, is dedicated to providing services for its members.
The Chamber has several committees with objectives directed towards the strengthening of free enterprise, investment promotion, community service, improvement of governmental and international relations, and providing services for its members.
The Board of Directors, elected every year, is made up of the Executive Committee, the Directors, past Presidents and Directors representing Provincial Offices.
***************************
IMPORT ADMINISTRATION
Safeguarding American Industries and Jobs against Unfair Trade
Source: Department of Commerce, United States of America.
Foreign-trade zones are designated sites licensed by the Foreign-Trade Zones (FTZ) Board (the Secretary of Commerce is Chairman) at which special customs procedures may be used.
FTZ procedures allow duty-free export and deferral of customs duty payment on items used in domestic commerce, helping to offset customs cost advantages available to plants abroad.
FTZ activity is conducted under the supervision of the Bureau of Customs and Border Protection, Department of Homeland Security.
That?s the cast of players.
Next is Connect the DOTS.
*************************************************
The Modus Operandi for the IMF & World Bank, is laid out in this film review
I posted it, because, this is the best explanation, as to how the 2 organizations, operate, over and over and over.
Now at 1st, I thought some of what I have been posting was BS, I will tell you it?s not.
2nd, What the IMF has done with other countries in the past, Argentina, Venezuela, Mexico, etc, etc.
I am watching happen in front of my own eyes, day to day, right where I live now.
Every day, I can predict what is going to happen with country, based on past events.
What is happening, will not affect me personally, but it is truly incredible to watch it happening, in front of your own eyes.
The U.S. is the biggest player in both organizations, and it receives its yearly quota, of cash contributions, to both organizations, directly from U.S. tax payers, both individual, and corporate.
Next up on the horizon for the IMF & WB,?? IRAQ, think I?m kidding, go check out their web-sites.
As I post this, plans are being drawn up, for more FTZ, constructed along with, new airports/roads/ports, and communication system?s.
Those contracts, and the $ 87 Billion that was just appropriated???A drop in the bucket, compared to what?s coming down the road for Iraq.
All on U.S. Tax dollars.
*************************************************************
Life and Debt: Behind paradise's facadeLife and DebtA film by Stephanie Black
Available on DVD and videotape
If you want to understand the operations of the International Monetary Fund (IMF) and how this and other World Financial institutions condemn Third World countries to permanent underdevelopment and poverty, purchase or see Life and Debt.
The film begins with a group of English tourists, mostly working class, who have scrimped all year to save for a two-week holiday in the sun, arriving in Jamaica. The film takes the viewer beyond the flash hotel rooms and luxurious setting to expose the reality behind the facade: the contents of the toilet are flushed straight into the ocean because there is no sewage treatment plant; the mouth-watering dessert of pineapples and bananas is made from tinned fruit imported from the USA.
The contrast between a ?paradise? of palm trees and beautiful tropical beaches and the reality of run-down schools and a vast slum just behind the hotel is difficult to comprehend.
The complexity that seems to shroud international lending, structural adjustment programs and free trade begins to lift when the impact of these policies is seen in the day-to-day lives of the Jamaican people.
Life and Debt reveals the deliberate destruction of the country's farming sector. Jamaica was self-sufficient in carrots, potatoes, pumpkins and onions, but now much of the land lies abandoned under the impact of forced imports of US agricultural products. The Jamaican milk industry, after 50 years of breeding suitable cattle, has been destroyed, due to cheap imports of powdered milk from the US. Similarly, due to the unfair competition by US-owned Chiquita banana corporation, the number of Jamaican small banana farmers has been slashed from 45,000 to 3000.
The US government is determined to torpedo the agreement between the European Union and Europe's former colonies, using the World Trade Organization. The Loan's Convention provided for a tax-free import quota of 105,000 tones of fruit per year to England from the West Indies. US opposition is specifically directed at protecting US companies, Chiquita and Dole.
Addressing the issue of free trade zones, Life and Debt introduces the viewer to workers employed by US corporations who must sew six days a week to earn the legal minimum wage of US$30 a week. The port of Kingston is lined with high-security factories, made available to foreign garment companies at low rent.
Foreign companies are allowed to bring in shiploads of raw material tax-free, have them sewn and assembled and then immediately transported out to foreign markets. No export tax is paid to the Jamaican government. More than 10,000 women work for these foreign companies and are required to put up with sub-standard work conditions.
The Jamaican government has agreed to the stipulation that no unionization be permitted in the free trade zones.
The film is interspersed with interviews with former Jamaican Prime Minister Michael Manley, who was elected on a non-IMF platform in 1976. He was forced to sign Jamaica's first loan agreement with the IMF in 1977 due to lack of viable alternatives.
At present, Jamaica owes more than $4.5 billion to the IMF, the World Bank and the Inter-American Development Bank, among other international lending agencies, yet the development that these loans ?promised? have failed to eventuate.
One criticism I would offer is that the film tends to paint tourists as the guilty party. Jamaica's situation has little to do with individual Western tourists, many of whom are also the victims of global exploitation, but in different ways.
Life and Debt also presents interviews with the slimy and smarmy IMF deputy director, Stanley Fischer, who spins a tale of the ?benefits? of the loans. Manley confesses that it broke his heart when he had to agree to the IMF loans, as he believed there was no other way out of Jamaica's situation.
The US government, in collusion with the international bankers, forced him out of government in 1978 in a campaign of destabilization. Unfortunately, that fact is not mentioned in the film.
The film's music is terrific, with classic songs by Bob Marley and Harry Belafonte and others. The color-drenched cinematography is also spectacular. The film is based on a book by Jamaica Kincaid, called A Small Place.
While Life and Debt offers few solutions, the problem is depicted in very clear terms. It's obvious the policies of the Western-dominated international financial institutions are deliberately designed to destroy the Third World's home-grown industries, and to benefit the US.
The DVD has bonus features, including additional interview footage of Michael Manley, a commentary by the director and gallery of photos of the anti-globalization movement.
******************
Taken from old posts right on this board!!!!!!!
Thank You to all, who are quoted here!!!!
PM or E-mail me, so I can give proper credit please!
Benefits for the DR.
My dad once said, Life is unfair Tim. I am being underpaid, not by my standards, but by international standards. A NYC Sanitation worker makes more than I do, and I'd like to think I am more qualified. He then said, this is the job I choose. Instead of complaining on how my boss has money for constant vacations and new cars, I am concentrating in either getting a better job and/or developing skills that makes me "more wanted" in my market. (said that to me 28 years ago, when was 12.)
This is a discussion for another time or thread, but the key is education. Why are FTZ employees better paid now than 15 yrs ago? Because they are more qualified now, instead of sewing cheap panties they now assemble complex electronic machinery. We now have technical colleges that turn out brighter, smarter, graduates, with instructors from the U.S.
Us Gringos, want more modern homes, and we need our high speed internet.
Between the Higher educated Dominicans, and us ex-pats, there is a tremendous spread of capital, what the bookends call Trickle Down Economics.
What about the millions of dollars Nike spends on manufacturing, marketing, distributing etc etc. If they didn't have low overheads, they couldn't compete, if they couldn't compete, the ad people, TV commercial producers, warehouse & logistic people, wouldn't have a job.
Welcome to capitalism, it's what puts food in your mouth and clothes on your back. :smoke:
Take a look in your wardrobe, around your house, you may be surprised what multi-nationals you support. What about the computer you?re using? Do you know its origin?
some FTZ statistics
Some statistics from the Free Zone Council (they based this on 2001 numbers, but just released it):
51 Free Zones with 512 companies in the DR.
175,000 directly employed workers in FTZ's in 2001.
26 FTZ's are Privately owned with 226 companies;
22 FTZ's are Publicly owned with 164 companies;
3 FTZ's are Mixed ownership with 91 companies;
there are 31 Free Zone Especiales (basically an area surrounding a company that is then called an FTZ I think.
16 FTZ's have 10 or more companies, and of these, 10 FTZ's are Privately owned and 2 are of Mixed ownership.
16 FTZ's have only 1 company in them.
My company is 1 of these.
Average salaries:
Technicos: RD$1833 per week
Obreros: RD$778 per week
51% of companies are textiles
17% are Services
and then in descending order are:
electronics
tobacco
jewelry
shoes
50% are US owned companies
32% are Dominican owned companies
5% are Korean companies
2% are Puerto Rican companies (they broke this out, not me).
PS- Playing music boosts productivity in assembly type work by 10% - it PAYS to play it!
***************************
Ok, you guy?s have more education, on this, then you will ever need in this lifetime.
So I need to know, are you looking at Manufacturing under the IRS 936 Twin Plant Rule?
Or are you into Importing/Exporting/Sub-contracting, I-Net??????????????
Sub-letting an office?
Is it just something for the 2 of you, or more.
Alot of people, will help you out here, but we need more info.
Thanks
Tim H. :smoke:
Last edited:
I should have included this!!!!
Some people have complained about the Work Ethics, of this Country's Citizen?s
Just my opinion.
I have 800, employees.
And I have lots, of managers.
Most of my managers, have some common traits.
All speak & write 2 or more languages.
All have at least 1 technical degree, sometimes more.
All are VERY WELL ORGINIZED, to the point that I?m jealous.
All have excellent attendance record's, usually are working 10 hour days.
They are all extremely professional, dedicated, hard working, talented people.
And they have all earned my respect.
The one thing I find lacking, is actual hands-on technical capabilities. Everybody is a specialist in one field. And once they have that Degree, it is very tough to get them working with their hands & brains again, verses their brains & mouth.
I have to remind my-self, were am I going to get some-one who is experienced, all the way around, in their particular field???
I'm not, you have to groom them on your own.
Ask for a spread sheet or a MS power point presentation, they will blow you away. Ask, do you think that operator needs a power tool or a fixture too do the job, more efficiently?????
" Let me do an analysis, and I'll get back to you with my findings"
Were doing electronics, RF, IR, Microwave, frequency?s, along with PC Boards, that have components placed on them, faster than you can blink you eye.
Where can I get experienced, technical people like that??????
I can't, I have to groom them, and our ex-employees usually get hired away by new Foreign start-up companies.
And do Extremely Well, for them selves
I just needed to add that.
Thanks
Tim H.
Some people have complained about the Work Ethics, of this Country's Citizen?s
Just my opinion.
I have 800, employees.
And I have lots, of managers.
Most of my managers, have some common traits.
All speak & write 2 or more languages.
All have at least 1 technical degree, sometimes more.
All are VERY WELL ORGINIZED, to the point that I?m jealous.
All have excellent attendance record's, usually are working 10 hour days.
They are all extremely professional, dedicated, hard working, talented people.
And they have all earned my respect.
The one thing I find lacking, is actual hands-on technical capabilities. Everybody is a specialist in one field. And once they have that Degree, it is very tough to get them working with their hands & brains again, verses their brains & mouth.
I have to remind my-self, were am I going to get some-one who is experienced, all the way around, in their particular field???
I'm not, you have to groom them on your own.
Ask for a spread sheet or a MS power point presentation, they will blow you away. Ask, do you think that operator needs a power tool or a fixture too do the job, more efficiently?????
" Let me do an analysis, and I'll get back to you with my findings"
Were doing electronics, RF, IR, Microwave, frequency?s, along with PC Boards, that have components placed on them, faster than you can blink you eye.
Where can I get experienced, technical people like that??????
I can't, I have to groom them, and our ex-employees usually get hired away by new Foreign start-up companies.
And do Extremely Well, for them selves
I just needed to add that.
Thanks
Tim H.
Timex - Thank you!
Tim, I?m speechless! Thank you very much for the information. I would love to have lunch with you during our visit and detail our objectives. Again thank you.. it was most excellent to get your expertise. Can we arrange a time to visit with one another?
Tim, I?m speechless! Thank you very much for the information. I would love to have lunch with you during our visit and detail our objectives. Again thank you.. it was most excellent to get your expertise. Can we arrange a time to visit with one another?
Hello, I work for an american multinational advertising agency... so are my clients... I know people who work for independent organizations that help with insight, info and contacts to interested investors, both from Europe and the US, these are funded from abroad and are very effective at finding opportunities for foreign investors... this is what they do... not a consulting firm... they basicly move funds here and find opportunitties that provide returns for local industry with foreign capital
I could introduce you to them... and help guide you around, or at least give you some info if I'm too busy.
I could introduce you to them... and help guide you around, or at least give you some info if I'm too busy.
----- ----- -----BizWiz said:
I would be extremely careful. Many an investor have lost of fortune in all kinds of ventures down there. Dominicans can be charming but you may get a show that is all smoke and mirrors. I would try to approach executives in well-established companies in the Dominican Republic. Stay away from military and government types as they can produce all kinds of fake stuff to support whatever they say. I will give you two referrals: International Trading Co. and Gomas Dominicanas-- try to get in touch with the executives there. They are honest, ivy league educated. Good luck.
Shucks!!!!!!
What DCfred said, is mostly, very good advice!
I'm not Ivy League educated, but I am Honest!!!! :classic:
Shure,anytime! But you gotta buy the beer!!!! :smoke:
**************************************************
About me, and how I wound up here.
I was fortunate enough to spend 8 years in the U.S. Navy, as a Nuclear Propulsion Officer, as a young single man, leaving the country for a 9 month tour out at sea, the schedule was pretty much the same, 2 weeks out, 2 weeks in port. In that time I visited more Foreign countries than there are U.S. States. I had some real experiences. 1986 onboard the U.S. Archerfish, one of three nuclear submarines stuck in a hole of ice, four feet thick, at the North Pole. 45 days of absolute cold, a science expedition we were told, 3 layers of clothes and blankets when you went to your bunk. Outings topside, dressed in the latest Artic gear and Cosmoline smeared all over your face to prevent frostbite. After a half an hour you could not tell where the heavens met the earth, everything was just white. Forget about what going to the head involved. Since I could only watch Walt Disney?s, Bambi so many times, I spent allot of time reading out at sea.
In port was a different story. One time we cruised to La Maddalena, Italy. Some of my mates and I, took 4 days of Liberty and drove to a town called, Barry, where by midnight I was arrested for playing Pokymon with the Mayors daughter. Stripped, thrown in a cell, and a, fire hose and electric cattle prod fitness program applied, I thought it was over. I had visions of winding up like the Americans in the ?Midnight Express?. I was grateful when someone from the U.S. Embassy demanded my release the next morning, drove me back to the ship, and explained to the Captain why we were under orders to leave port, two weeks early.
But that was after, being sent to the British Nuclear Submarine, H.M.S. Spartan, as a part of the Navy Exchange Sailor program. Traded with an Officer on that ship to take his duty for 6 months. No one can drink or party, like the people of South Hampton. I still remember the feeling I had the first time I walked into the Officers Wardroom on that sub, two kegs of tapped ale mounted securely in the wall (officers can drink at their own pace out at sea!).
All because, I read, Jules Verne?s, 20,000 leagues under the sea, as a kid.
After picking up too many Rads, I became ineligible for sea duty, shore command wasn?t for me, and so I resigned. After going back to Civilian life, and working various positions in manufacturing companies, I bought an old molding machine and Bridgeport, milling machine. I rented a corner of some one else building and went into the molding business.
After about 8 years, I had my own place, 40 employees, I took on a partner, and together, we had just bought another small molding company. That?s where I met my wife, she was the Q.C. Manager for that company. She spoke perfect English, had become a U.S. Citizen, and holds Bachelors in Engineering, from NYU. I now had 80 employees, 24 molding machines and a 65,000 Sqf facility.
There were times it was good- very good, and there were times it was very bad!
Do you know what it's like to have to reach into your own pocket to cover this weeks payroll for $ 36,500. because some of your Fortune 1000 customers are not paying their bills on time?
My partner screwed me, while I was on a business trip, down here for our customer.
I got my clock cleaned, I started my walk of life leaving my dad?s house for the Navy, with just the clothes on my back. I always worked hard, never bull-shitted anybody, I didn?t step on anybody along the way. By the time the dust settled between my Ex-Partner and my-self, what he didn?t get, my attorney?s did. I lost everything but the house I bought for my parents, which was still in my name, my dads house was taken by Medicaid, for coverage they provided for my mom. I was allowed to keep only 1 primary residence.
One of my 1st customers, who watched me go from a 2 man operation, right up till the end, and is now my employer, spent a number of years trying to convince me to work for him down in the D.R. So I found myself with-out a nickel in my pocket, and my wife encouraging me to take this job.
So I accepted it, the biggest reason being--.
Right after I left the service, while driving hard though life, my parents became sick. First Dad then Mom. 15 years of running them to Hospitals, Doctors, Monthly prescription bills too the tune of $ 3200. (No B.S. there!). I finally got some insurance on them, also, managed home care 24/7, and I am still taking care of all of their monetary responsibilities and needs. After allot of encouragement from my folks, I told my younger brother, who had been working for me since High School,
********************************************
So if you still want to get together, let me know!!!!
Thanks
Tim H. :smoke:
What DCfred said, is mostly, very good advice!
I'm not Ivy League educated, but I am Honest!!!! :classic:
Shure,anytime! But you gotta buy the beer!!!! :smoke:
**************************************************
About me, and how I wound up here.
I was fortunate enough to spend 8 years in the U.S. Navy, as a Nuclear Propulsion Officer, as a young single man, leaving the country for a 9 month tour out at sea, the schedule was pretty much the same, 2 weeks out, 2 weeks in port. In that time I visited more Foreign countries than there are U.S. States. I had some real experiences. 1986 onboard the U.S. Archerfish, one of three nuclear submarines stuck in a hole of ice, four feet thick, at the North Pole. 45 days of absolute cold, a science expedition we were told, 3 layers of clothes and blankets when you went to your bunk. Outings topside, dressed in the latest Artic gear and Cosmoline smeared all over your face to prevent frostbite. After a half an hour you could not tell where the heavens met the earth, everything was just white. Forget about what going to the head involved. Since I could only watch Walt Disney?s, Bambi so many times, I spent allot of time reading out at sea.
In port was a different story. One time we cruised to La Maddalena, Italy. Some of my mates and I, took 4 days of Liberty and drove to a town called, Barry, where by midnight I was arrested for playing Pokymon with the Mayors daughter. Stripped, thrown in a cell, and a, fire hose and electric cattle prod fitness program applied, I thought it was over. I had visions of winding up like the Americans in the ?Midnight Express?. I was grateful when someone from the U.S. Embassy demanded my release the next morning, drove me back to the ship, and explained to the Captain why we were under orders to leave port, two weeks early.
But that was after, being sent to the British Nuclear Submarine, H.M.S. Spartan, as a part of the Navy Exchange Sailor program. Traded with an Officer on that ship to take his duty for 6 months. No one can drink or party, like the people of South Hampton. I still remember the feeling I had the first time I walked into the Officers Wardroom on that sub, two kegs of tapped ale mounted securely in the wall (officers can drink at their own pace out at sea!).
All because, I read, Jules Verne?s, 20,000 leagues under the sea, as a kid.
After picking up too many Rads, I became ineligible for sea duty, shore command wasn?t for me, and so I resigned. After going back to Civilian life, and working various positions in manufacturing companies, I bought an old molding machine and Bridgeport, milling machine. I rented a corner of some one else building and went into the molding business.
After about 8 years, I had my own place, 40 employees, I took on a partner, and together, we had just bought another small molding company. That?s where I met my wife, she was the Q.C. Manager for that company. She spoke perfect English, had become a U.S. Citizen, and holds Bachelors in Engineering, from NYU. I now had 80 employees, 24 molding machines and a 65,000 Sqf facility.
There were times it was good- very good, and there were times it was very bad!
Do you know what it's like to have to reach into your own pocket to cover this weeks payroll for $ 36,500. because some of your Fortune 1000 customers are not paying their bills on time?
My partner screwed me, while I was on a business trip, down here for our customer.
I got my clock cleaned, I started my walk of life leaving my dad?s house for the Navy, with just the clothes on my back. I always worked hard, never bull-shitted anybody, I didn?t step on anybody along the way. By the time the dust settled between my Ex-Partner and my-self, what he didn?t get, my attorney?s did. I lost everything but the house I bought for my parents, which was still in my name, my dads house was taken by Medicaid, for coverage they provided for my mom. I was allowed to keep only 1 primary residence.
One of my 1st customers, who watched me go from a 2 man operation, right up till the end, and is now my employer, spent a number of years trying to convince me to work for him down in the D.R. So I found myself with-out a nickel in my pocket, and my wife encouraging me to take this job.
So I accepted it, the biggest reason being--.
Right after I left the service, while driving hard though life, my parents became sick. First Dad then Mom. 15 years of running them to Hospitals, Doctors, Monthly prescription bills too the tune of $ 3200. (No B.S. there!). I finally got some insurance on them, also, managed home care 24/7, and I am still taking care of all of their monetary responsibilities and needs. After allot of encouragement from my folks, I told my younger brother, who had been working for me since High School,
********************************************
So if you still want to get together, let me know!!!!
Thanks
Tim H. :smoke:
Typical scenario:
You will get wined and dined, taken to beach houses, usually borrowed. But once they have your money, you will never get a call answered. It will be: "lo siento, el Sr esta en una reunion...o fuera del pais"...and don't even try getting a lawyer, they won't touch it if the person who defrauded you is associated with the military and government. To be fair, some Americans can do this too. I remember this business woman, Barbara Brown, who went there looking for Gold and investors, but disappeared one day leaving a trail of bad checks, worthless pretty stock certificates and a couple rabid generals. Don't you love it? Almost all taken in that case were Dominicans, so it works both ways.
You will get wined and dined, taken to beach houses, usually borrowed. But once they have your money, you will never get a call answered. It will be: "lo siento, el Sr esta en una reunion...o fuera del pais"...and don't even try getting a lawyer, they won't touch it if the person who defrauded you is associated with the military and government. To be fair, some Americans can do this too. I remember this business woman, Barbara Brown, who went there looking for Gold and investors, but disappeared one day leaving a trail of bad checks, worthless pretty stock certificates and a couple rabid generals. Don't you love it? Almost all taken in that case were Dominicans, so it works both ways.
Last edited:
I?ve been thinking about what Dcfred said.
My 1st 3 months here, the company had us living at a hotel, the El Embajador, until we got settled.
And I remember many nights, sitting in the lobby, listening to the piano player, my wife and I would over here conversations, between guys from the U.S. and their D.R. contacts. I would say 30% would be complaining about were did the capital go, where are the contracts, can we use/sell the assets, what can we do to get the SOB!!! :angry: :angry:
Sometimes these conversations would get very colorful, when they were told about their options. :laugh: :laugh:
I had forgot how funny it was to watch these guys explode, the ones from Texas would talk about shooting the guys. :devious: :dead:
Thanks, Dcfred, for bringing that up, your right, some people in the world are not straight shooters.
I have to think about a Sanki related name for the one?s here, because in essence, that?s what they are. Back home, we just call them Con-Men.
For gilbert, I already did that
Clink on the link below, to see the rest of what happened
Moving to the DR, our story
BizWiz, I will PM/E-mail you my contact info tomorrow.
Talldrink, you already have our contact info, just let us know when, we can even drag Jan, from the Capital for a Wet & Wild Weekend!!! :bunny: :bunny:
Thanks
Tim H. :smoke:
My 1st 3 months here, the company had us living at a hotel, the El Embajador, until we got settled.
And I remember many nights, sitting in the lobby, listening to the piano player, my wife and I would over here conversations, between guys from the U.S. and their D.R. contacts. I would say 30% would be complaining about were did the capital go, where are the contracts, can we use/sell the assets, what can we do to get the SOB!!! :angry: :angry:
Sometimes these conversations would get very colorful, when they were told about their options. :laugh: :laugh:
I had forgot how funny it was to watch these guys explode, the ones from Texas would talk about shooting the guys. :devious: :dead:
Thanks, Dcfred, for bringing that up, your right, some people in the world are not straight shooters.
I have to think about a Sanki related name for the one?s here, because in essence, that?s what they are. Back home, we just call them Con-Men.
For gilbert, I already did that
Clink on the link below, to see the rest of what happened
Moving to the DR, our story
BizWiz, I will PM/E-mail you my contact info tomorrow.
Talldrink, you already have our contact info, just let us know when, we can even drag Jan, from the Capital for a Wet & Wild Weekend!!! :bunny: :bunny:
Thanks
Tim H. :smoke:
Last edited:
Planning our visit
Tim H, We are arriving the 8th and staying until the 15th. I would love to have lunch and a few beers with you during our visit. Please tell me if this is something you would consider? I value your time and information thus far. Thank you very much.
Tim H, We are arriving the 8th and staying until the 15th. I would love to have lunch and a few beers with you during our visit. Please tell me if this is something you would consider? I value your time and information thus far. Thank you very much.
Attn: BizWiz
Hi guys.
I'm assuming you guys are in the DR right now (you mentioned Mar. 8-15th)...how are things going? I am also planning a trip down to Santo Domingo, but it won't be until August, and I plan on staying at least 3 months. What kind of business are the two of you planning on opening up? I would appreciate you sharing anything that you learn from your visit...and I'm sure on top of doing research for your business, you're having a blast...that's a guarantee in the Dominican Republic!
Hi guys.
I'm assuming you guys are in the DR right now (you mentioned Mar. 8-15th)...how are things going? I am also planning a trip down to Santo Domingo, but it won't be until August, and I plan on staying at least 3 months. What kind of business are the two of you planning on opening up? I would appreciate you sharing anything that you learn from your visit...and I'm sure on top of doing research for your business, you're having a blast...that's a guarantee in the Dominican Republic!
BizWiz said:
BizWiz said:
To add my two cents:
The "Free Trade Zone" concept it's nothing new in the DR, it dates back more than 3 decades back or maybe more depending on what kind of industry you research. The DR does offers an opportunity to invest with confidence after all it has been an example of democracy and political calm since April 1965, as pointed out more than clearly by Timex hereto there' re several FTZ to consider all dependent on you industry and means, however if you do plan to invest on a major business venture there I must say that you should take time to research and find localized solutions for your outsourcing of goods just as we did back in 1985 - 1988 in a Leather goods plant in Santiago FTD, we committed time and a research personnel to find local quality material instead of using the normal importing of goods and thus created an excellent bond with several local industries in the DR, as a matter of fact some of our finished goods were replicated in a local non FTD plant for DR commercialization using the local available materials and using our incoming international capital as a payment tool to provide for the goods received by our plants from these local suppliers, hence we circumvented the local Govt. regulated exchange market to our advantage and profit, think of it as the consumer of paper bags being the source of crude materials to the same paper company!
Quality control is very hard and to be honest something the DR industry lacks entirely across the board, but a well trained team can accomplish far more than any good handshake from you international out source of goods.