Ministry develops textiles competitiveness programme
The Department of Trade and Industry (the dti) has been working intensively with all stakeholders over the last 18 months to give effect to the Customised Sector Programme (CSP) process. We are now at a point where very significant progress can be reported with respect to giving effect to the CSP. Immediate implementation of the CSP will entail four initial core programmes.
CLOTHING AND TEXTILES COMPETITIVENESS PROGRAMME (CTCP)
In order for companies in the clothing and textiles sectors to be in a position to compete with international competitors in the domestic and international markets, it is essential that they advance their operational competitiveness to world class performance levels. the dti has therefore developed a Clothing and Textiles Competitiveness Programme (CTCP) which is being administered by the Industrial Development Corporation (IDC) and consists of the following elements:
- A capital upgrading programme available to clothing, textiles and footwear manufacturers via the Enterprise Investment Programme administered by the dti together with preferential loans via the IDC at prime less 5%.
- A firm and cluster level Clothing Textiles Competitiveness Improvement programme (CTCIP) which will be provided on an attractive cost-sharing basis.
TACKLING ILLEGAL IMPORTS
One of the most critical challenges is the combating of pervasive illegal imports within the industry, including under-invoicing. In December 2008 the South African Revenue Services (SARS) dedicated specific capacity to deal with illegal activity in the clothing, textiles and footwear sectors. It is now undertaking an ongoing series of enforcement campaigns. Either the dti or SARS can be contacted directly with information on illegal activity. the dti will be monitoring the campaign activities and work closely with SARS to agree strategic priorities.
RESPONSE TO THE GLOBAL ECONOMIC CRISIS
In light of the global economic crisis, the National Economic Development and Labour Council (NEDLAC) facilitated a framework for responding to the crisis involving all key constituencies: Business, Labour, Community and Government. The framework was made public on 19 February 2009. One of the sectors identified for priority attention was the Clothing and Textiles sector. There is an ongoing process via NEDLAC of discussing and agreeing on concrete measures. The outcome of this process will supplement the actions which are already being undertaken by the dti above.
In the interim the IDC has approved a response programme and subject to its criteria will provide funding to firms that are in distress as a result of the crisis.
REVIEWING COST STRUCTURES
As a first step, import duties on textile inputs into clothing manufacturing that are not commercially produced in South Africa have been reviewed by the International Trade Administration Commission (ITAC). This comprised the revision of import duties on especially fabrics which are not being manufactured locally and / or not available locally in sufficient quantities. The review has been finalised and is now with SARS for implementation.