U.S. Trade Rep. Zoellick Visits S. African Clothing Plant

Workers celebrate trade ties with U.S.

Johannesburg (South Africa) - Greeted by colorfully costumed traditional African folk dancers and singers, the United States Trade Representative, Ambassador Robert B. Zoellick, toured a clothing plant in South Africa February 19 which is now busy filling orders for clothing to be shipped to America, made possible by the historic African Growth and Opportunity Act (AGOA).

After receiving a warm welcome from the dancers and singers, actual plant workers whose jobs had been saved by AGOA, Ambassador Zoellick was officially greeted by a South African plant employee who shouted praise for America in his native tongue before swooping down as part of the ceremony to honor the delegation.

After the ceremony, executives from Transvaal Clothing Industries (TRACLO) -- located in downtown Johannesburg -- briefed Zoellick, who was on his last day of a lengthy visit to South Africa.

Mike Destombes, TRACLO's managing director, told Zoellick the Johannesburg plant employs 700 people. A second TRACLO plant employs 400, he noted, adding that another plant is now under construction in Swaziland.

As a result of AGOA, which allows textiles and clothing from eligible African countries to be exported to the United States duty free, Destombes said, "We only see growth taking place," because of large U.S. customers, who are now buying clothing from the plant. One such customer is The Limited, a U.S. based national retailer of women's clothes.

He stressed the need to constantly develop greater skill levels on the part of his workers to accommodate U.S. customers, adding "AGOA is changing our business quite substantially."

Many of the workers in the plant, Destombes told Zoellick, are single parent mothers from nearby Soweto who support large extended families on their own and now - thanks to AGOA - on regular wages of about $200 a month.

Many of those same workers who were waving South African and U.S. flags, he said, would have normally been laid off had it not been for AGOA because of seasonal and slack domestic demand for women's clothing in South Africa.

Rather than laying off any workers this year, Destombes told Zoellick, because of AGOA TRACLO is now hiring extra workers to fill orders for the United States.

"The African Growth and Opportunity Act (AGOA) has definitely started to impact our business and" he explained, "it matches" well with the seasonal downturns in the business that TRACLO experiences when just producing for the domestic South African market. U.S. orders, he noted, tend to increase as the South African market begins its seasonal slowdown

As Ambassador Zoellick listened intently in a room filled with display samples of the plant's clothing lines, Destombes said an average production run for the domestic South African market is only about 1,000 pieces, vs. upwards of 40,000 pieces for a run of women's clothing produced for shipment to the United States under AGOA.

"If AGOA had not happened, I think I must tell you that I don't think our plant would have been more than a year or two away from disintegration," he told Zoellick, saying it was getting harder and harder to survive on just the domestic South African market.

Zoellick asked Destombes if he sees any way AGOA can be improved and if TRACLO has any worries regarding the trade agreement.

Destombes said his company is worried that AGOA - which is a preferential trade agreement -- has only been authorized by the U.S. Congress for eight years, through 2008.

Picking up on that point, Zoellick said that is why he has been exploring with the Southern African Customs Union (SACU) the possibility of doing a free trade agreement between the United States and SACU members. A free trade agreement, he said, like the North American Free Trade Agreement (NAFTA) between the United States, Mexico and Canada, would lock-in long-term and very predictable trade terms and benefits for all countries involved.

Following the briefing, Zoellick and the executives walked out on the bustling factory floor where 700 workers, predominantly women, were busy sizing, cutting, pressing and packaging clothing both for the domestic South African market and the U.S. market.

The workers erupted in singing, chanting and celebration, with one shouting and waving "Hello USA!"

Red and tan womens' suits were being produced for the South African domestic market and hung in neat rows, while thousands of upscale black polyester outfits were being put together on a separate line for The Limited.

As Zoellick walked through the plant, he saw the womens' clothing lines being sewed together and pressed, packaged in plastic and boxed for shipment by ocean freighter to The Limited's distribution center in Columbus, Ohio.

That clothing, Destombes told Zoellick, arrives in the United States 22 days after it leaves the factory, and is shipped out complete, in plastic, on a hanger already bearing their price tags in U.S. dollars and the label of the retailer. The Limited need only unpack the box and place the clothing on the display rack, he said. It is shipped out ready to go.

Zoellick is the 13th U.S. Trade Representative and the first ever to travel to sub-Saharan Africa. He sits on President Bush's cabinet and holds the rank of ambassador.

Zoellick is on a tour through Kenya, South Africa and Botswana February 12-21.