The cost of apparel production in Peru would rise by 4 to 5 percent if the countervailing measures on imports of US cotton by the National Institute of Defense of Competition and Intellectual Property Protection (INDECOPI) are applied, according to the Exporters Association of Peru (ADEX).
Pedro Gamio, chairman of ADEX Apparel Committee, said the shipments of clothing declined by 16.5 percent year-on-year during the period between January and July 2013, and implementing countervailing measures on imports of US cotton would further lead to a decline in the shipments, reports Peruvian newspaper La Republica.
The ADEX official said that possible application of countervailing measures on the imports of cotton from US would increase the production costs of Peruvian garments by 4 to 5 percent.
According to data released by ADEX, Peruvian apparel shipments to foreign countries from January to July totaled US $ 735.5 million which was a decrease of 16.5 percent year-on-year. The US was the main destination where Peruvian apparel worth US$ 363 million was shipped, followed by Venezuela where apparel worth US$ 148.8 million was shipped during the January-July 2013 period.
The ADEX official also said that other threats faced by the Peruvian apparel sector include the legal framework that does not allow fixed term contract for garment workers and the uncertainty of international markets.