Foreign Trade Zone Plan Given Cautious Indorsement at Hearing

None of the 14 witnesses at a joint hearing last night of the House Economic Development Committee and Pacific and Asian Affairs Committee opposed bills to pave the way for a foreign-trade zone in Hawaii, but some were lukewarm in their indorsement.

Representative Toshio Serizawa (Democrat-Hawaii), chairman of the former committee, promised a favorable report to the full house.

House Bill 17 (and H.B. 50, its long form) would permit the State to apply to the U.S. Commerce Department for a foreign-trade zone Federal law requires such State legislation. It would also empower the Governor to do all needed to establish and operate a zone.

In a foreign-trade zone any legitimate merchandise can enter duty-free. There it may be stored, handled or processed, and then imported into the U.S. or abroad.

Shelley M. Mark, Director of Economic Development, did not expect any substantial profit from the zone for at least four years, but he said "We should make an investment so that we are in a position to capitalize on the future growth of the Pacific."

He visualized Honolulu eventually becoming an international marketplace like the free port of Hong Kong, and said "I can see tremendous stimulation to our tourist industry."

Melvin E. Lepine, chief engineer of the Harbors Division, Department of Transportation, called Sand Island the best location for the zone from a transportation standpoint, but said it lacks piers.

He roughly estimated it might cost $1.75 million to build wharf and shed facilities there.

He said only the New York and New Orleans foreign-trade zones are showing profits, slight ones. The other zones are at Seattle, San Francisco, Toledo and Mayaguez (Puerto Rico).

Max L. Pilliard, vice-chairman of the Chamber of Commerce of Honolulu’s trade committee, said the State should consider very carefully the zone’s feasibility, potential for development, and break-even chances before going ahead with it.

Spokesmen for U.S. Representatives Spark Matsunaga and Thomas P.Gill expressed the Congressmen’s support for the legislation.