Dionne Rose, Business Reporter

Jockey International, the American underclothing manufacturer, will close its last Jamaican plant by year end, slashing 575 jobs and ending a 24-year presence in the island.

However, Dalton Taylor, the manager of the facility in Lucea, Hanover, which employs mainly women, could not say precisely when the plant will close its doors.

Jockey, in a statement, said the closure of the Lucea factory was linked to the shutdown of its Cooleemee, North Carolina knitting facility, from which the Jamaica operation got its fabric.

Expected move

"Jockey's plants in Costa Rica and Honduras, along with Jockey's contractors in that region, will absorb the sewing production from the Jamaica plant," said the group's senior vice-president for manufacturing and operations, Marion Smith.

But while Smith blamed events at Cooleemee for the demise of the Lucea plant, Jockey's eventual pull out from Jamaica has long been expected.

Last year, Jockey closed a facility in Sandy Bay, Clarendon, displacing approximately 600 workers.

Uncompetitive

Indeed, it was the last of the multinational apparel stragglers in Jamaica after fundamental shifts in the industry that made countries like Jamaica uncompetitive.

The textile/apparel industry boomed here in the 1980s when, buttressed by the Multi-Fibre Agreement (MFA), the United States allowed Jamaica and other Caribbean Basin countries hefty quotas that allowed them to exports garments to the United States under the section 807 arrangement.

The imports were duty-free, except for the local value-added, which was usually relatively cheap labour and domestic rent and utility costs.

Later, the quota arrangements were enhanced if the garments were fashioned from fabric cut and/or made in the United States.

At the industry's high-point, it employed about 30,000 women and earned over US$500 million annually.

Tariff-free entry

However, garment assembly began to unravel in Jamaica when the United States joined Canada and Mexico in the North American Free Trade Area and firms bolted to Mexico to take advantage of full tariff-free entry into the US market and cheap Mexican labour.

It plunged into further trouble when the MFA was eventually phased out under World Trade Organisation rules.

The removal of the quota system meant cheaper producers in China, Bangladesh and elsewhere in Asia could join the market, displacing Latin America.

On Thursday, Taylor told the Financial Gleaner that the Sandy Bay plant was up for sale, but it was not immediately clear if Jockey has offers.

dionne.rose@gleanerjm.com