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Govt negligence may lead textile sector to doom
Feb '08
The textile industry of South Africa is striving for every single breath for survival. Plagued by increasing cost of inputs, weaker rand and massive job losses, the sector is nearly paralyzed to the extent that it might have to undergo termination.

Prices of essential inputs have risen by as much as 68 percent and mainly due to higher oil prices. Cotton and viscose fibre have risen by 35 and 63 percent respectively. On the other hand, packaging material went up by 22 percent while freight costs higher by 12-34 percent compared to the last eight.

Textile industry of South Africa which is recognized as the key job-creating sector employing over 44,000 workers, is already running a loss of 10 percent in employment this year. To add to the already devastating situation, the domestic market has been flooded by cheap imports from China.

In fact, even after levying a quota limit on China there has been no improvement in the condition of the industry since retailers have resorted to import from other countries.

Additionally, in a bid to preserve their own margins retailers have been piling pressure on manufacturers to absorb the increasing costs, but this is a practically impossible realization.

The Government, which until now stood indifferent to the concerning situation, has been called in for intervention and assistance. Unless concrete measures are taken to curb these negative factors, textile industry is unlikely to recuperate from the upshots of economic instability.

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