Congressman Faleomavaega announced today that he appreciates StarKist’s willingness to downsize in American Samoa, unlike Chicken of the Sea that chose to downsize in Lyons, Georgia after doing business in the Territory for some 50-years.
“For our workers who are affected by StarKist’s recent announcement to downsize its operations in American Samoa, I want to once more reiterate that the U.S. Department of Labor (DOL) is on stand-by to work with the American Samoa Government on a National Emergency Grant (NEG) which would provide our displaced cannery workers with the possibility of job training and stipends,” Faleomavaega said.
“When Chicken of the Sea announced its closure, I provided the Governor with a point of contact at the DOL to assist ASG in applying for a national emergency grant and, in that letter of May 7, 2009, I explained that NEG applications must originate with and be submitted by the Governor.”
“In response to my letter, ASG did move forward with submitting a NEG application but, when the tsunami struck, the DOL helped ASG prepare a disaster NEG application and, as a result, ASG was awarded $24 million to put our people back to work and to assist with recovery efforts.”
“Since that time I have had follow-up discussions with the DOL in case StarKist workers should be laid off and the DOL is prepared to review any application ASG may put forward to assist these workers as American Samoa works to rebuild and revive its economy.”
“Additionally, at the federal level, I have been working with the House Ways and Means Committee and Senator Reid’s office since January of this year to put a short-term solution in place until a long-term solution can be found. Although I would like to announce our progress, the negotiations are sensitive and I do not want to do anything to jeopardize the outcome, given how serious these matters are for our people and economy.”
“I am also still pushing forward on a revised version of ASPIRE as a more permanent solution but this is no easy task, as I have said before, because Bumble Bee and Chicken of the Sea are opposed to it. Both Bumble Bee and Chicken of the Sea oppose ASPIRE because they have adopted a business model of exploiting cheap foreign labor to clean their fish while employing skeletal crews of 200 employees or less in small U.S. operations in Georgia, Puerto Rico, and California to package the final product.”
“In contrast, StarKist is the only major brand of canned tuna that still cleans whole fish in America and pays its workers decent wages. Unfortunately, StarKist can longer compete against Bumble Bee and Chicken of the Sea’s exploitation of cheap foreign labor and ASPIRE was introduced to level the playing field. But Bumble Bee and Chicken of the Sea do not want a level playing field. Instead, they want to have an unfair advantage in the marketplace, and this is not right.”
“For now, both companies have convinced their Democratic Members of Congress that they will lay off workers in California, Georgia, and Puerto Rico if ASPIRE is enacted. But, given that Bumble Bee and Chicken of the Sea would be unable to take advantage of duty-free treatment if they laid-off their remaining skeletal crews in Puerto Rico, California, and Georgia, it is highly unlikely that these tuna processors would follow through on their threats. This is why I hope Bumble Bee and Chicken of the Sea will come back to the negotiating table and stand with us to fight off foreign competition, especially from Thailand.”
“Given Thailand’s surge in the marketplace and private label now taking over nearly 30% of the U.S. market, I have asked the U.S. Department of Commerce to open an anti-dumping investigation regarding canned tuna imported from Thailand. On March 24, 2010, I brought this matter to the attention of the U.S. Department of the Interior in hopes that the Office of Insular Affairs would strengthen our hand by gathering sufficient information in advance of informing Thailand or involving Commerce but Interior prefers to assist, as appropriate, in any petition we may submit.”
“Based on Interior’s response, I wrote to Secretary Gary Locke of the U.S. Department of Commerce on May 12, 2010 requesting that he open an anti-dumping investigation. I believe any petition put forward should come from our displaced cannery workers and, if they wish to pursue this avenue, I stand prepared to help them, especially since Thailand has become the world’s largest canned tuna producer and processes a large percentage of tuna caught in the Pacific region. Thailand is the leader in supplying tuna to the United States, and the low cost of labor (at about $0.75 cents per hour) provides Thailand with a trade advantage. According to Atuna, Thailand reported an eleven percent increase of tuna exports, from 65.9 million tonnes in 2008 to 73.7 percent in 2009.”
“Thai Union, which owns Chicken of the Sea, has also evolved to be one of the world’s leading producers and exporters of canned tuna in the world. Thai Union has previously been found guilty of dumping shrimp and I have concerns that this also may be the same with canned tuna which is already considered a highly-sensitive commodity.”
“In a recent announcement, Thai Union reported that ‘tuna products remain the largest item in the company’s product portfolio at 43%, followed by frozen shrimp at 21%.’ In the same announcement, Thai Union also reported a remarkable 12% profit growth in the 3rd quarter of 2009 from the same period the previous year, noting that ‘the relocation of production from the American Samoa plant to a new facility in the state of Georgia, USA had been completed.’”
“What Thai Union failed to state is that it displaced some 2,000 cannery workers in American Samoa and outsourced their jobs to Thailand where workers are paid $0.75 cents and less per hour. Then, in Georgia, Thai Union, under the auspices of Chicken of the Sea, hired a skeletal crew of about 200 workers to take advantage of duty-free access to the U.S. market. I strongly believe this is an unfair trade practice and I will do everything I can to close down this loophole.”
“I will also continue to work hand-in-hand with StarKist. However, as I said before, we cannot expect StarKist to stay in the Territory if it cannot operate at a profit. Right now, the global tuna market makes it impossible for StarKist to compete against wage rates of $0.75 cents and less per hour and, frankly, I don’t see wage rates in foreign countries changing anytime soon.”
“As for federal minimum wage increases, I have already announced that Chairman Miller has agreed to delay the next minimum wage increase and we are trying to find the appropriate legislative vehicle to get this done. However, minimum wage increases are not and never were the cause of the collapse of the tuna industry in American Samoa. As the GAO report verifies, as of 2006, prior to minimum wage increases ever going into effect, our two tuna canneries were already losing $7.5 million per year because neither cannery could compete against Thailand’s wage rates of $0.75 cents and less per hour which has resulted in Thailand’s private label business taking over almost one-third of the U.S. market.”
“Whether or not Thailand is dumping remains to be seen. But what is certain is that the tuna industry has changed tremendously over the course of the past 50-years. The tuna industry American Samoa once knew is no longer the same and this is why ASG must diversify its economy by implementing the recommendations of the American Samoa Economic Advisory Commission which issued its report in 2002. The process will be long and difficult but it is a journey that must be undertaken.”
“Again, I want to personally thank StarKist, and especially Chairman Kim Jae-chul of the Dongwon Corporation and Mr. Don Binotto, President and CEO of StarKist, for acting with full integrity at all times and for choosing to downsize in American Samoa rather than closing its operations in the Territory. As we know, Chicken of the Sea closed its operations without the courtesy of discussing its departure with any of our elected leaders and it is my understanding that one of the reasons Chicken of the Sea chose not to downsize in American Samoa is because the State of Georgia offered Chicken of the Sea a better local tax incentives package.”
“StarKist has also been offered other deals but, to its credit, StarKist has chosen to work with our elected officials. In fact, StarKist reached out to all elected officials in American Samoa – including my office, the Governor and the Fono – to ensure that everyone could be personally briefed on last week’s announcement.”
“StarKist went so far as to arrange a conference call at 3:00 pm Eastern time Thursday, May 13, 2010 that was supposed to be between Mr. Binotto, the Governor and myself. Per StarKist’s request, I arranged my schedule in order to be on the conference call because the very nature of the request suggested that the announcement must be serious and important to our cannery workers and the future of the tuna industry in American Samoa.”
“In that call and in all previous discussions that have taken place in for more than a year, StarKist has been very clear about the help it needs at the local and federal level in order to stay in American Samoa. While ASG has not informed my office of any efforts it is making at the local level to assist StarKist, I submitted a March 11, 2010 report to the FONO which I copied to the Governor outlining all I have been doing at the federal level on behalf of our people and local cannery workers.”
“At this time, I want to assure our cannery workers that the federal government through the U.S. Department of Labor stands prepared to help ASG submit a national emergency grant application to provide job training and other assistance for those affected by this layoff. I also want to let our people know that I will continue to do everything I can at the federal level to help StarKist as we try to find new ways to move forward and confront the challenges before us as a result of global competition from low-wage rate countries that pay fish cleaners $0.75 cents and less per hour,” Faleomavaega concluded.