Chinese clothing imports may be cut
April 15, 2004
By Quentin Wray and Margie Inggs
Johannesburg and Durban - Clothing manufacturers may be in line for relief from the onslaught of cheap Chinese imports, the department of trade and industry has hinted.
Lionel October, the deputy director-general in charge of enterprise and industry development at the department, said this week the "surge of imports from China" was hurting the industry and his department was setting up a task team with industry players to look at short-term remedies.
World Trade Organisation (WTO) regulations allow countries to implement temporary safeguards such as tariffs and import quotas to protect industries threatened by a surge in imports from low-cost producers.
According to the Southern African Clothing and Textile Workers' Union (Sactwu), 20 000 blue-collar workers - about 10 percent of the industry's workforce - lost their jobs last year through retrenchments and factory closures, after the strengthening rand made imports more competitive in local markets and eroded export competitiveness.
This number excluded workers put on short time and those in downstream and service industries whose livelihoods had been eroded by the industry's downsizing.
Ebrahim Patel, Sactwu's general secretary, said import volumes from mainland China had increased by 80 percent last year.
He said short-term steps - such as increasing tariffs to the maximum levels allowed by the WTO (South Africa had cut its tariffs by more than it was required to), strengthening anti-dumping measures, introducing safeguard tariffs against low-cost producers like China and improving customs controls to stem the flow of illegal imports - could be taken to protect local jobs.
To ensure its long-term survival, the clothing industry needed to restructure to move local firms up the value chain, modernise plants and improve the skills base of workers.
"There is a range of things that can be done to turn this industry into a world-class industry," Patel said.
October did not give details of what steps would be taken but warned the local industry that, over the long term, South African firms would be unable to compete with China in the lower end of the market.
South Africa should concentrate on middle- to upper-market segments.
"China's economies of scale mean it is massively competitive in the low end of the market ... they have a huge internal market and a vast pool of cheap, skilled labour," October said.
Despite the problems faced by some companies that were very heavily exposed to the export market, the South African clothing and textiles industries were starting to turn around and companies that balanced their local and export markets were faring best.
Jack Kipling, the president of the Clothing Export Council and the Clothing Trade Council (Clotrade), said the rand was hurting exports while the local clothing industry was struggling against competition from cheap imports, "principally from China, which benefits from unfair trade practices".
Kipling said Clotrade was working with retailers to identify how to better market South African goods.
|
|
