Republican presidential nominee Donald Trump points out to the crowd of supporters at a campaign rally  in Prescott Valley, Arizona. (Getty Images) Republican presidential nominee Donald Trump points out to the crowd of supporters at a campaign rally  in Prescott Valley, Arizona. (Getty Images)

Republican presidential nominee Donald Trump points out to the crowd of supporters at a campaign rally in Prescott Valley, Arizona. (Getty Images)

Jon Greenberg
By Jon Greenberg October 11, 2016

Trump mangles facts on Clinton and Haiti jobs project

Hillary Clinton is facing criticism for her role in facilitating the creation of an industrial park in post-earthquake Haiti that has been accused of displacing farmers and failing to live up to rosy job creation projections.

Among the charges, Republican presidential nominee Donald Trump said Clinton pushed aside regulations to create sweatshop-like conditions.

"Hillary Clinton set aside environmental and labor rules to help a South Korean company with a record of violating workers’ rights set up what amounts to a sweatshop in Haiti," Trump said Sept. 6, 2016.

Clinton, as secretary of state, certainly lauded the project as part of a plan to revitalize Haiti following the devastating earthquake in 2010, and the U.S. government financially supported it. But did she help a company create a sweatshop?

The evidence is thin.

The Caracol Industrial Park

In 2010, Haiti’s leaders unveiled a plan to spur growth beyond the capital city of Port-au-Prince. One project that emerged was to build an industrial park on the country’s northern coast a little over a mile from Caracol Bay. It was going to bring tens of thousands of good-paying jobs, government officials said. Getting it off the ground took a collaboration among the U.S. Agency for International Development, the Inter-American Development Bank, the government of Haiti, and a South Korean clothing maker, Sae-A Trading.

Sae-A, under the name of S&H Global, would be the anchor tenant of the new industrial park, producing clothes for clients such as Target and Walmart. Bill and Hillary Clinton, champions of that vision, came to the park’s grand opening. In fact, both of them lobbied hard for the project. Bill Clinton in his role as special envoy to Haiti pushed for expanded garment making. Sae-A said Clinton herself invited the company to build a factory at the industrial park.

The U.S. Agency for International Development allocated $170 million to support the industrial park by building a power plant and improving the port.

"What is happening here in Caracol is already having ripple effects that will create jobs and opportunities far beyond this industrial park," Hillary Clinton said at the Caracol opening ceremony.

But that really hasn't happened.

The industrial park has been beseiged by criticism of millions of dollars wasted, displaced farmers and sluggish job growth. Today, four years, later, total employment is about 8,100. (The State Department told us after publication that new data show the facility now employs about 9,400 people.)

That's the background. Now, we'll look at the specifics of Trump's claim.

Clinton's role in environmental and labor rules 

Trump said Clinton "set aside environmental and labor rules" to make the project a reality.

The Trump campaign pointed to an article that appeared in the New York Times. That report cited environmentalists decrying the placement of the industrial zone near a sensitive marine habitat. The U.S. Treasury Department abstained from voting on the project due to concerns over the limited environmental impact studies that had been prepared.

That's not the same as Clinton setting aside rules, and people involved with the project said Clinton played no role.

Charles Krakoff, managing partner of the consulting firm Koios Associates, created the environmental impact report in an assessment for the government of Haiti and the Inter-American Development Bank. Krakoff told us that the Haitians, the development bank and USAID pressed for a quick turnaround, and he agrees that his firm did not produce a full long-term analysis. But he said he did address the immediate impacts and laid out the sort of studies needed later.

The Inter-American Development Bank followed through. It commissioned a more comprehensive study in 2014, which was completed in August 2016.

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"Environmental standards were not changed for this project," Krakoff said.

USAID produced a separate environmental impact study for the power plant alone.

Importantly, Krakoff said the key decision to place the industrial park in Caracol was made by the government of Haiti not Clinton. Whatever environmental issues that raised flowed from that point forward and Clinton played no role.

"We told them two other locations would be better, but the government wanted it in Caracol," Krakoff said. "The Haitians and the Inter-American Development Bank had more say in this project than the United States."

Sae-A's record on workers' rights

Clinton, as we already said, did play a part in getting Sae-A to Haiti, and Sae-A does not have a perfect record with workers.

The company had a significant dispute with the union at a factory in Guatemala. The AFL-CIO accused it of anti-union repression including "acts of violence and intimidation." Sae-A ultimately abandonned that Guatemalan factory. But, in 2008, the International Trade Union Confederation highlighted the company as one of only three in Guatemala that had unions at all and met with union representatives weekly to discuss working conditions.

We found an academic article that accurately described an episode when Sae-A managers at one plant in Guatemala used police to intimidate union organizers. The researcher cited a WikiLeaks cable from 2005 as proof, but failed to note that the cable went on to say that when the government and the company found out what happened, it fired all the managers involved and reinstated the workers with back pay.

In Nicaragua, a 2013 investigation of a clash between union supporters and non-union workers found that Sae-A did nothing to prevent the unrest.

So, the evidence that Sae-A violated workers rights is limited. The company had a dispute with its unions in Guatemala and allowed a fight to break out between union and non-union workers in Nicaragua.

Is Sae-A running a sweatshop?

Many factories in Haiti are subject to six-month inspections by Better Work Haiti, a project of the International Labor Organization. The latest assessment raises a few points of concern, but nothing that would in any way meet the definition of sweatshop conditions.

On the contrary, the report lists several strengths, including providing "free, first-class education to the workers’ kids." The company provides paid sick and maternity leave, which according to the company, has been used in 6,336 and 220 cases respectively in 2016. There are three unions in the factory representing about 30 percent of all workers.

Safety and health conditions passed muster in the assessment. The issues raised were isolated, or due more to workers not using safety equipment (ear plugs) that the company gave them (and trained them on why they should use them.)

Inspectors and the company have a dispute on the legal definition for holiday, sick and maternity leave pay that has been referred to the government for resolution.Of workers who are paid based on how much they produce, only 41 percent make the government’s target minimum wage, which suggests much improvement is needed, although the inspectors did not say this made the company non-compliant with the law.

Pay is a point of broader concern. The advocacy group Worker Rights Consortium issued a report in 2013 that accused Sae-A of "ongoing theft of legally-earned wages." But when we asked the executive director if this met the criteria of operating a sweatshop, he declined to comment. The AFL-CIO also failed to respond to questions about Sae-A.

Our ruling

Trump said Clinton "set aside environmental and labor rules to help a South Korean company with a record of violating workers’ rights set up what amounts to a sweatshop in Haiti."

There is no evidence that Clinton set aside environmental and labor rules and Trump exaggerated about the record of the South Korean company in question.

We rate this statement Mostly False.

Correction Oct. 12, 2016  Sae-A closed the Guatemala factory where it had a dispute with a union. A previously version of this fact-check incorrectly said Sae-A left the country entirely.

https://www.sharethefacts.co/share/4e6663b3-a536-4892-b9a6-79688568959f

Our Sources

Donald Trump, Speech in North Carolina, Sept. 6, 2016

Better Work Haiti, S&H Global compliance assessment report, Sept. 6, 2016

Better Work Haiti, 12th bi-annual synthesis report, April 15, 2016

Comisión de Verificación de Códigos de Conducta, Independent investigation at Sae-A Tecnotex, April 19, 2013

Worker Rights Consortium, Stealing from the Poor: Wage Theft in the Haitian Apparel Industry, Oct. 15, 2013

New York Times, Earthquake Relief Where Haiti Wasn’t Broken, July 5, 2012

Government Accountability Office, Haiti reconstruction: USAID infrastructure projects have had mixed results and face sustainability challenges , June 2013

Haiti Observatory, Haitian environmental legislation, accessed, Oct. 4, 2016

EcoWatch, 10 Best (and Worst) Countries for Environmental Democracy, May 20, 2015

National Lawyers Guild - Environmental Justice Committee, Republic of Haiti - environmental justice, Oct. 3, 2011

New York Times, On Environmental Brink, Haiti Scrambles for a Lifeline, Nov. 9, 2009

Inter-American Development Bank, Haiti receives new IDB grant for its Caracol Industrial Park, Jan. 2, 2014

USAID, Environmental assessment of the SUAID/Haiti North Park power project, June 2011

Koios Associates, Etude des Impacts Environnementaux et Sociaux (EIES) du Parc Industriel dans la Région du Nord d’Haïti, May 13, 2011

Inter-American Development Bank, Mitigating the Environmental Impacts of the PIC in the Caracol Bay, Aug. 19, 2014

SAE-A, SAE-A Hait fact sheet, January 2016

Center for Economic and Policy Research, Environmental, Labor Concerns Overlooked in Rush to Build Caracol Park, Part II, July 9, 2012

Clinton Foundation, Caracol Industrial Park, accessed Sept. 23, 2016

U.S. Agency for International Development, Caracol Industrial Park, Aug. 8, 2016

Politico, The King and Queen of Haiti, May 4, 2015

Wall Street Journal, Hillary’s Half-Baked Haiti Project, Jan. 11, 2015

Miami Herald, Hillary Clinton-backed post-quake Haiti project ‘a work in progress’, May 3, 2015

Banco Interamericano de Desarrollo, Video: Thousands of jobs for Haiti, March 10, 2016

Slate, The Clintons Didn’t Screw Up Haiti Alone. You Helped.Sept. 22, 2016

Email interview, Lon Garwood, spokesman, Sae-A Trading, Oct. 5, 2016

Email interview, Mark D’Sa, senior advisor for industrial parks, Haiti Special Coordinator’s Office, U.S. Department of State, Sept. 23, 2016

Interview, Charles Krakoff, managing partner, Koios Associates, Oct. 3, 2016

Email interview, Scott Nova, executive director, Worker Rights Consortium, Sept. 30, 2016

Email interview, Steven Cheung, spokesman, Trump for President, Sept., 26, 2016

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Trump mangles facts on Clinton and Haiti jobs project

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