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Clothing factories urge for removal of import quota
08
Apr '08
Ideally clothing manufacturers should have gained from the restriction imposed on cheap clothing and textile imports from China. However, on the contrary, producers are hit badly by a cut in the supply of fabric.

In the first year of quota being implemented, imports from China in textile and clothing declined by 48 percent to R3.7 billion.

Although retailers have started looking for alternative countries like Indonesia, Bangladesh and Vietnam, imports from China have not been completely replaced.

A 22 percent decline in imports made by South Africa should have benefited the manufacturers but the cut, make and trim operations (CMTs) which largely depend on fabric imports are forcing producers to use low quality local materials.

Foschini Group, a popular name in fashion retailing, obtaining some 40 percent of its work from CMTs, has also witnessed a 30-40 percent decline in its business.

In order to safeguard local manufacturers, quotas were also imposed on textiles that are not easily available in South Africa. As a consequence, manufacturers who were already fighting against rising costs, electricity cuts and low purchasing power, are now also faced with the problem of inferior quality raw material, high price and delayed delivery.

Earlier, before the implementation of quota, Foschini purchased products from 30 factories. However, now, it can provide only 16 factories with work since fabric volumes were inadequate.

Already a small supplier of Foschini closed down last year because of this crisis and now Kangasling, its biggest suppliers, will follow the footprints.

The trade and industry department of the Government is considering an extension of the quota but manufacturers at large have urged the authority to refrain from taking such negative measure likely to lead towards more closures.

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Courtesy: Reliance Industries

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