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China cutback on clothing and textile exports PDF Print E-mail
Friday, 30 June 2006 13:22

Press release : Immediate

The recent announcement by China that it will cut back on exports of clothing and textile exports to South Africa was warmly welcomed and can create thousands of new jobs in the local industry.

 

So said Mr Ebrahim Patel, General Secretary of the 110 000 strong SA Clothing and Textile Workers Union (SACTWU).

The announcement follows months of negotiation between the governments of China and South Africa . The agreement now awaits final signature by the Trade Ministers following its initialling at a ceremony yesterday involving Chinese Premier Mr Wen Jiabao and South African President Mr Thabo Mbeki. Both governments have to comply with internal formal processes that are expected to be concluded within the next two weeks prior to the agreement coming into effect.The agreement is expected to set quantitative targets on specified clothing and textile products and the final text and details are in the process of being finalised.

 

Over the past three and a half years, the local fashion manufacturing industry has lost approximately 63 000 jobs, largely as a result of a surge of imports from China .Since 2002, clothing imports from China rose by 480%.In July last year, SACTWU submitted an application to the International Trade Administration Commission (ITAC), the statutory body responsible for trade-relief measures, detailing the market disruption and injury caused by the flood of Chinese imports.

 

The application identified a large number of products where jobs were lost, factories closed down and local manufacturing capacity was lost. It called for urgent trade safeguard measures as permitted under the terms of China 's accession to the World Trade Organisation (WTO).

 

Following the application, consultations took place between the two governments, as required by World Trade Organisation rules, in order to consider the request by SACTWU. These talks concluded with consensus to have a bilateral agreement in which China undertook to limit exports and increase investment in the South African industry. “The agreement is a positive development and will help to save and create local jobs,” said Mr Ebrahim Patel.

 

“The agreement, which is for a fixed time-frame, gives us a great opportunity to rebuild the local industry. We need to use the space created to ensure we make our factories state-of-the-art and improve training of workers on a scale that will develop South Africa into a world-class producer,” he said.

 

“Over the past three years, industry has been completely preoccupied with short-term survival and not enough focus was placed on the long-term development of the sector. This agreement will now give business and labour a unique opportunity to plan ahead,” Mr Patel said.

 

“The industry needs a triple package: trade measures with China, a competitiveness package for industry and an active ‘buy local' campaign. We have now achieved an in-principle agreement on the Chinese imports. The rest of the plan has to be implemented as a matter of urgency. Taken together, they can create more than 60 000 new jobs in the industry,” he said.

 

“In March this year, during the Cape Town Fashion Festival, SACTWU released details of a 14 point growth plan for the industry which envisages significant support from government to recapitalise plant and equipment, train workers, support innovation and design excellence and turn the industry into a quick-response, consumer-oriented sector. Business, labour and government are in the process of finalising the plan and it will be an excellent complement to the trade agreement,” Mr Patel said.

“We acknowledge the cooperation between the dti and SACTWU on the future of the industry, the support given by the tripartite alliance since April 2005, and the public commitment to the industry made by President Mbeki. The COSATU programme of mass action has highlighted the fate of retrenched workers and has built a constituency of public support for the industry” he said.

 

 

Issued by the SA Clothing and Textile Workers Union (SACTWU). For more information, please call 021-4474570.