A report in the Northern Mariana islands says garment sales there have dropped by more than a quarter during the first four months of the 2006 financial year, compared to the same period a year before.
The newspaper, the Marianas Variety, reports garment factory closures and reduced orders in a US$75 million drop in garment sales.
Early last year the World Trade Organisation liberalised trade rules which allow manufacturers from other countries with even lower labour costs to export their apparel to the US with fewer restrictions.
Since then seven Saipan garment factories have closed down, three of them having committed various labour violations.
This also means that the government user's fee collections dropped.
User's fees are the taxes paid by businesses on locally manufactured and finished garment products.