DRUG SMUGGLING COMPLICATES CARIBBEAN TEXTILE BUSINESS

Gildan Activewear has closed a small sewing plant in Barbados because the
textile company can't keep drug smugglers from packing marijuana into the
plant's clothing shipments, the company announced Thursday.

Gildan, a Canadian company with operations in Eden, said customs officials
found marijuana on a shipment to the United States in February. The company
decided to close the plant because its security wouldn't be able to stop
the smuggling.

The company made its comments in a news release. Gildan officials did not
return several calls for further comment.

While the company expects the move to have little effect on its bottom
line, the news exposes what could be a bigger problem for the struggling
textile industry.

Under pressure to compete with Asia, many North Carolina textile companies
are looking to the Caribbean Basin countries for help. A new trade law
makes it more profitable to ship textiles to those countries, where workers
will sew the fabric into garments and send them back to the United States.

But drug smuggling on those shipments back to America could complicate the
process. On the line for textile companies is a projected $8 billion
increase in U.S. fabric sales to the region over the next three years.

"We're not going to be able to get anything from there if authorities there
aren't better able to police this," said Charlie Bremer, director of
International Trade for the American Textile Manufacturers Institute. "They
need to do something about it."

Bremer said the Gildan incident is not an isolated one. Several Triad
textile and apparel companies said Thursday they take extremes to prevent
the smuggling.

The marijuana on the February Gildan shipment was found during a stop in
Jamaica, according to Gildan. The drug was found in a container of Gildan's
products.

Incidents like this one aren't unusual, according to U.S. customs
officials. As imports soared throughout the 1990s, drug smugglers looked to
otherwise legal shipments to get their contraband into America.

"They put it in places where customs just can't find it," said Dean Boyd,
an anti-drug specialist with the U.S. customs agency. Hundreds of tons of
narcotics are seized this way each year.

But that can become a problem for a textile or apparel company victimized
by the smuggling, industry officials say. Customs officials often seize the
entire shipment if they find narcotics.

"That's a product you've sold, but can't deliver to your customers," said
Peggy Carter, a spokeswoman for Sara Lee. ''People don't have the time for
that or the resources to replace it."

Since marijuana was detected on a shipment from a Sara Lee contractor about
10 years ago, the company devised a better security plan and hasn't had an
incident since.

"It told us we have to develop a better mousetrap," said Jerry Cook, the
company's vice president of international trade.

But if drug-smuggling is a problem for textile companies at all, as some in
the industry say, it will only get worse in the next few years. Trade with
the Caribbean is expected to be on the rise because of the new legislation.

That should benefit domestic textile companies, but Gildan's problems have
caused some concern.

"We need the imports to get here for it to increase," said Bremer.