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Chinese Fabric Quotas Do Not Cause The Recession Of South African Clothing Enterprises

2008/4/14 11:44:00 36

Chinese Fabric Quotas Did Not Cause The Recession Of South African Clothing Enterprises.

South African media: Chinese fabric quotas are not the cause of the recession in South African clothing companies.

In recent days, some large South African companies have called for the abolition of the import quota of Chinese textile fabrics. They say that because of the quota management of Chinese fabric imports, some garment manufacturers are now short of fabrics.

Unfortunately, their statement ignores the fact.

China's quota only affects a small proportion of South African fabric imports, accounting for 16% of total fabric imports in 2006 (2006 was the year before implementation of quotas).

The implementation of quotas is not a prohibition of imports.

It only limits the number of imports from China.

There are three kinds of products. Now the number of South Africa Company imports is already 70-80% imported in 2006. One of the imports is 350% in 2006 (the number of imports in 2006 is very large, partly because 2006 is the last year before the quota is implemented, and some companies are hoarding stock).

The lobbyists said that the quota of fabrics would be abolished. They said the problem of the garment industry was due to the lack of fabric and the fabric was included in the quota management.

But they did not point out that the import of fabrics in other countries was not limited by quotas.

Even if you accept this, you should expect that the quota usage rate should be one hundred percent because of the shortage of domestic fabrics.

But what is the truth?

In six textile categories, three products were used less than 40% last year, and the maximum utilization rate was only 71%.

Nonetheless, in order to increase the flexibility of quota, Mandisi Mpahlwa, a minister of industry and trade, revised the quota management system last year. If companies put forward development plans to local industries, they could apply for additional quotas.

The purpose of this measure is to import some special fabric that is not produced in South Africa, but it still belongs to the category of quotas.

A survey of South African manufacturing companies a month ago showed that many clothing companies said they had fewer orders this year, mainly due to higher interest rates, higher food and pportation costs and lower demand for retailers.

The sharp decline in clothing retailing has made worrying signs of manufacturing and employment in the country.

But those complaining about the reduction in orders are due to the fact that people who do not consider all the facts caused by fabric quotas.

Some groups have to convince the government for their own interests, and they may quote some facts as arguments.

According to the trade data of the South African tax bureau, all tariff quotas include 24 garments, 6 kinds of textiles and 1 kinds of household textiles. Imports from all over the world dropped by an average of 50%, although quota management was only applied to China's imports.

Since 2003, 200 thousand workers in the textile industry have been reduced by 1/3, and the situation has improved recently.

The industrial organization called for measures to preserve more job opportunities.