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| Africa Subsaharan |
| ChinaÂ’s cutting exports to |
| 2006-01-25 |
| Consumer Industries Reporter THE South African clothing and textile industry has responded favourably to an announcement that China is to voluntarily reduce its clothing and textile exports to SA. A reduction in Chinese imports would help revive the domestic industry, said Aaron Searll, CEO of SA’s biggest clothing and textile manufacturer, Seardell Investment Holdings, on Friday. He said that clothing imports from China had risen 40% in the past nine months. “It cannot be allowed to continue like this, it is overwhelming,” Searll said. China’s ambassador to SA, Liu Guijin, said on Thursday his country would limit export of garments and some textile items to SA. Searll said more clarification was required on the form the limitations would take, and whether they would mean a percentage cap on the volume of imports, as promoted by the World Trade Organisation (WTO). “The industry also needs to know how long is it to be enforced for and who will enforce it,” he said. The import of high-quality textiles and clothing to the South African market by China has put increasing strain on the domestic manufacturing industry, leading to the demise of a number of companies, including KwaZulu-Natal’s largest textile manufacturer, Whiteheads. The company, which closed its doors at the end of 2004, blamed cheap imports from India, China, Pakistan and Indonesia for a R200m loss in turnover in the last two years that it operated. Clothing company Rex Trueform said in its annual report last year that highly competitive trading conditions in the industry resulted in larger-than-expected losses in manufacturing, which in turn resulted in retrenchments at all levels. Despite the massive job losses, which Searll put at 60000 in the past four years, he said the curb in imports would benefit the sector. Executive director of the Textile Federation of SA, Brian Brink, said he was not aware of the exact terms of the Chinese offer. “I do not know what has been negotiated, although every little bit would help,” he said. Brink said that the WTO agreement — in which members are allowed to limit Chinese textiles and clothing imports to 7,5% a year of the current level of imports until 2008 — was one possibility. Brink said he doubted the Chinese would stick to the particular limit as it was not a binding figure. “I feel that it was a bit of a pre-emptive move by the Chinese as the announcement was made by them instead of SA.” The trade and industry department set up a task team in April 2004 to investigate the industry’s need for protection against Chinese imports. The share prices of Rex Trueform, Seardell Holdings and Adonis Knitwear were unchanged at the close of the JSE on Friday. |
| Posted by:Creck Ulagum6581 |