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New import duty makes textile sector apprehensive
26
Mar '11
Mr Tarik Bozbey
Mr Tarik Bozbey
The Turkish textile and clothing sector is becoming increasingly apprehensive as Turkey plans to impose higher duties on imports of textile raw materials in order to protect its domestic industry.

Countries like Pakistan and Bangladesh which have a good pie of Turkish textile imports too have raised concerns over the reported move of the Turkish government.

Speaking to fibre2fashion, Mr Tarik Bozbey, Head - Mediterranean Exporters Union said, “First of all, I believe in the spread of free and fair trade all over the world as in the last 15 years, free trade made global trade grow from US $1 trillion to $14 trillion”.

He added by saying, “This also means a spread of wealth and growth of capacity to maximum optimum levels and scale economies, benefiting all industries and countries. This has also enabled about 260 million newcomers to join the middle class in the world population trade”.

“When Turkey is exporting a product to the eastern countries, average tax rate is about 60 percent. However, when Turkey is importing any product from similar countries, the tax rate is only 9 percent. This is unfair trade and injures Turkish economy.

“It is proven by investigations that, many products imported by Turkey have hidden support from the exporting countries, in the form of secret subvention between 20-50 percent. By regulations of World Trade Organisation (WTO), if there is a proven definite support and injury, anti-dumping tax can be imposed.

“In the last few years, an anti-dumping tax was started, this year a preventive tax is in discussion and soon a declaration is expected, which will increase the wholesale price of imported goods up by 20-30 percent in fabrics and by 30-40 percent in clothing.

“The retail prices will not and cannot increase at the same rates, but there will be an increase of 15-20 percent in retail prices which will trigger the inflation rates in Turkey. However, imports will fall and local production will increase.

“In recent times, not only cotton, but all textile raw materials have risen abnormally. During the 2009 crises, purchases were minimum, decreasing by 50 percent in all products. The recovery caught everyone by surprise. Empty warehouses with almost zero stocks.

“This rush to purchase increased the cotton prices. In case of synthetic fibres, one can step up output, but in cotton, one must wait for the season of planting and harvesting, which means a minimum wait of 10 months.

“In addition, there have been floods and disasters which ruined the cotton crop, along with which; several countries have restricted cotton, yarn and fabric exports”, he informed.

“I believe that, cotton prices will fall slightly during the Southern hemisphere harvesting period, i.e. between March to June and fall more between October and January. But we will not see a cotton price of US $1.4 / kg, for five years”, he wrapped up this very informative interview by saying.

Fibre2fashion News Desk - India

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