[Congressional Record Volume 140, Number 147 (Tuesday, November 29, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: November 29, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
           COMMENDING THOSE WHO MADE THE PIC PROGRAM POSSIBLE

                                 ______


                            HON. RON de LUGO

                         of the virgin islands

                    in the house of representatives

                       Tuesday, November 29, 1994

  Mr. de LUGO. Mr. Speaker, today the House votes on the Global 
Agreement on Tariffs and Trade, the GATT treaty, which will be the 
keystone of our Nation's economy in the 21st century. I commend our 
President for his leadership on GATT and I commend my colleagues in the 
House and in the other body who have worked so diligently to make GATT 
a reality.
  One of the provisions of GATT, small but of critical importance to 
the U.S. Virgin Islands and its economy, is the 12-year extension of 
the production incentive certificate program. Without this program, 
production of electronic watches in the Virgin Islands would come to an 
immediate halt and a half dozen watch firms employing some 400 people, 
primarily women, in decent paying jobs, would disappear and move to the 
Far East where wages are so low the United States cannot compete.
  The production incentive certificate program is a brilliant concept 
that is the brainchild of three people in the Statutory Import Program 
of the International Trade Administration of the Department of 
Commerce: Richard Seppa, who was the director of the program until his 
retirement; Frank W. Creel, who worked with Dick and now has taken his 
place; and Faye Robinson, the manager for the Production Incentive 
Program.
  Back in the early 1970's the Virgin Islands watch industry employed 
as many as 1,500 workers, but a decade later it was in real trouble; 
sales had shifted from mechanical movements to electronic ones and the 
lower tariff differentials were not enough to offset the higher costs 
of doing business in the U.S. Virgin Islands, even with duty-free 
entry.
  By the early 1980's, only about 100 people were employed in the 
industry, and even their jobs were threatened.
  But the creative minds of these three Commerce Department 
professionals invented the production incentive program. With the help 
of good friends of the Virgin Islands like Representative Charles 
Rangel, Eddie Jenkins, and Dick Schulze, and Senators Bill Bradley, the 
late Spark Matsunaga, and others, I was able to have the legislation 
passed in the last bill of the lameduck session of 1982.
  The program allowed watch manufacturers not only to ship their 
products duty-free, but also to receive negotiable customs certificates 
tied to wages paid in the Virgin Islands to offset other duties. 
Eligible salaries were capped, and the percentage of salaries covered 
decreased based on the number of pieces shipped, which were also 
capped.
  The results were gratifying. Employment rose almost immediately to 
660 jobs within just a few years, although it declined to about 400 in 
the aftermath of Hurricane Hugo in 1989.
  The jobs are important to the islands and important to our Nation. 
Without them, 400 people, primarily women who are heads of households 
and who could not find comparable work at their skill levels, would be 
without jobs, without income and without hope.
  Mr. Speaker, I want to publicly thank Richard Seppa, Frank Creel, and 
Faye Robinson for their contributions, their hard work, and their 
inventiveness. They are the unsung heroes of the work we did to rescue 
the Virgin Islands watch industry and the jobs of the 400 workers in 
it.

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