AMERICAN SAMOA GOVERNOR TOURS CANNERIES

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Togiola still hopeful companies will remain

By Fili Sagapolutele

PAGO PAGO, America Samoa (Samoa News, June 22, 2009)—Gov. Togiola Tulafono conducted a site visit of COS Samoa Packing and StarKist Samoa facilities last Thursday to look at the present assets of both canneries as well as seeking from StarKist Samoa the type of assistance they need.

The governor’s comments on his radio program confirmed reports Samoa News received late last week about the governor’s visit, as Samoa Packing prepares to close its Atu’u plant at the end of September this year.

Togiola said the purpose of the visit, which started at Samoa Packing and ended with StarKist, was to look at where the two canneries are at this point, as well as the type of assets in place such as equipment and machinery.

He said the goal is to continue to find ways to keep the canneries here by seeking out their needs. The other goal is the type of assets in place as the government looks at other people in this industry to continue cannery operation in the territory for the future.

Togiola said the good news is that the assets for the two canneries, including equipment and machines are in good condition.

SAMOA PACKING

Togiola said the company is still moving ahead with its original plans to close production at the end of September, adding he was informed by the company there is some equipment that will be left at the plant.

Samoa Packing started dismantling some of its equipment about two weeks ago, in preparation for shipment to Chicken of the Sea’s new plant in Lyons, Ga.

During the meeting with Samoa Packing officials, Togiola said he informed the company to consider the problems faced by American Samoa when they leave. He said he told the company it would have been easier to just turn over the plant to American Samoa instead of taking a lot of the important equipment to the mainland.

He said maintaining all of Samoa Packing’s assets as they are now will make it easier for others interested in setting up such operations in the territory, to move forward.

Togiola said he suggested to the company to keep most of the equipment and machinery at the Atu’u plant and the matter is being discussed by the company officials. Togiola said he hopes to hear from Samoa Packing this week on his request.

STARKIST SAMOA

During the meeting with StarKist Samoa officials, there was no mention at all about closing down production, but neither was it raised during the discussions, said Togiola.

According to the governor, company officials brought up a couple of issues for which they needed help, and he believes StarKist will stay on for a long time if some of their needs are addressed.

Togiola said only a small number of issues can be addressed by American Samoa —but the majority needs to be handled by the U.S. Congress, responsible for imposing federal mandates on the territory.

The top priority issue is the federally mandated minimum wage increase, said Togiola, who noted he has informed the company that he will inform the necessary Congressional members, including Congressman Faleomavaega Eni and U.S. Sen. Daniel K. Inouye, to do all possible to halt the minimum wage increases in an effort to save the cannery industry in the territory.

Togiola said letters to the congressional members are expected to go out this week.

According to the governor there has been much talk about the impact of the minimum wage hikes on the canneries but not much discussed on the impact to the local businesses, who are also suffering.

For example, he said the minimum wage for stevedoring companies has increased drastically and has resulted in layoffs. He said this increase in personnel expense is passed on to shippers, who in turn pass this on to stores. He said stores have no choice but to pass on these extra costs to consumers.

(The highest minimum wage classification in the territory at $5.59 per hour is in Stevedoring, Lighterage, and Maritime Shipping Agency Activities.)

The governor said the mandated wage hike must be halted at this point and reevaluated, looking for the best way to structure and implement minimum wages for American Samoa.

Togiola said another issue discussed with StarKist is that of a federal tax credit, that would not only help StarKist Samoa, but other companies. He said such a credit will make it easier for American Samoa to attract other companies to do business here, adding that Faleomavaega should take the lead role in this, because it is a congressional matter.

(The governor didn’t provide any specific details of the tax credit he referenced.)

Togiola also took issue with Faleomavaega’s past statements that both COS Samoa Packing and StarKist Samoa are foreign companies, because they are owned by foreign corporations. The governor said such statements are very wrong, adding the two canneries are still "American citizens".

San Diego-based Chicken of the Sea International and its subsidiary COS Samoa Packing are owned by Thailand-based Thai Union Group. StarKist Sea Food Inc. and StarKist Samoa are owned by Samoa Korean-based Dongwon Industries.

The third issue the governor said should be addressed by Congress is that of foreign built vessels being U.S. flagged and home ported in American Samoa, allowing these vessels to fish in the U.S. and the territory’s economic exclusive zones, or EEZs.

He says American Samoa does not benefit from this change because the vessels drop their catches at other foreign ports instead of coming to the territory.

He said if Congress can resolve these and other issues, it will make it easier for not only StarKist Samoa, but any future company looking at setting up canning production in the territory to do business locally.

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