The Chinese are coming.
Suzhou Tianyuan Garments Company, a Chinese manufacturer of casual apparel and sportswear and a big supplier to Adidas, signed a memorandum of understanding (MoU) with Arkansas Thursday. As part of the agreement, Tianyuan will invest $20 million in Little Rock and create 400 jobs paying an average of $14 an hour plus benefits.
The MoU marks the first time a garment manufacturer of Chinese ownership has invested in the United States.
“I am thrilled to announce that Tianyuan has chosen Arkansas as their North American home,” Governor Asa Hutchinson said in a statement. “Arkansas’ strategic location will give them great access to the U.S. market and beyond.”
“This deal with Tianyuan shows the continued momentum we have with companies looking to invest in Arkansas,” said Mike Preston, executive director of the Arkansas Economic Development Commission (AEDC).
Tianyuan produces roughly 10 million garments annually—90 percent of which is for Adidas—in five facilities in China. The company’s other customers include Reebok and Armani and it was one of several suppliers for the 2014 World Cup and for this year’s Italian Olympic team.
“What’s fascinating is these are high-paying jobs in terms of the garment industry. It is more highly technical, including robotics, and so it will be interesting to watch and see how the garment industry unfolds in the coming years and how Arkansas can participate in that,” Gov. Hutchinson said during a Skype call with reporters Thursday morning.
According to the MoU, Arkansas will provide a $1 million infrastructure assistance grant, $500,000 for training and an estimated $1.6 million in rebates based on the company’s annual payroll. The deal also calls for a 65 percent abatement on property tax and the state’s assistance to obtain 20 work visas.
AEDC will continue to work with Tianyuan to finalize additional details. The company expects to be operational in Arkansas by the end of 2017.
“Bringing garment manufacturing back to Arkansas is probably met with some initial skepticism because everyone thinks, well, we’ve lost shoe manufacturing, we’ve lost some of our apparel industry in the past,” Gov. Hutchinson said. “But we have met with [other Chinese] apparel manufacturers that are looking at eastern Arksansas and the Delta and those are ongoing discussions…So hopefully more [announcements] down the road.”