Textile body chief derides surge in RMG imports

15 Apr '09

2 min read

Despite, the Turkish Lira appreciating against the US dollar, leading to a plunge in overall imports of the country in the first two months of the year by as much as 45 percent, clothing imports have fallen by only seven percent, leading to concerns in the sector.

Addressing the media, the President of the Istanbul Textile and Apparel Exporters' Associations (ITKIB) President Hikmet Tanriverdi said that, “The exchange rate should not fall below TL 1.50, which could lead to a deluge in imports from the sector”.

Quoting from statistics, he said, “During the period when the economy was battered by the turmoil, imports of clothing like pullovers/sweaters and woven men's shirts increased by 33 percent and 73 percent, respectively and in the same period imports from Bangladesh rose by an unprecedented 79 percent”.

He added, “Between May 2008 and January 2009, 50,827 enterprises stopped operations across all sectors, out of which 7,506 apparel manufacturing closed down, leaving 158,088 unemployed, 18 percent of the overall employment in the sector”.

Putting across a valid point he said, “If the Social Security Institution (SGK) premiums and income tax rates had been lowered, the state would have made a profit of up to TL110 million, considering that cost of 160,000 people eligible for the unemployment fund for a period of six months is TL 253 million”

He added by saying, “The SGK insurance premium loss is TL 541 million. The total loss is TL795 million. If the SGK premium and income tax rates were lowered, the total loss would be TL686 million. But after the discount, the state would have obtained a profit of up to TL 110 million”.

Speaking on demands of the sector, he said, “SGK insurance premiums and income tax rates should be lowered by 50 percent until the end of 2009, loan guarantee fund should be established as soon as possible, value-added tax (KDV/VAT) should be lowered and 50 percent of export insurance premiums should be paid by the state”.

Speaking of further demands he said, “The design, product development, template or model preparation and other innovative activities of the sector should be made part of the research and development (R&D) law, companies should benefit from R&D incentives for every five employees out of 100 they employ”.

Fibre2fashion News Desk - India

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