Import curbs 'must not hit only China'
The trade and industry department has commissioned a study to gauge the effect of quotas on Chinese clothing and textiles imports into SA, which were introduced almost two years ago.
Several trade and industry officials have hinted that the quotas may be extended.
It is believed that the findings of the study are likely to inform the trade and industry department's decision on whether to extend the import curbs.
Manufacturing stakeholders, the sector which the quotas are supposed to protect, are, however, sceptical about the wisdom of extending the import curbs. Textile Federation executive director Brian Brink said his organisation did not support the extension of quotas in their current form.
The department, he said, should go back to the drawing board and devise a different kind of safeguard measure, not aimed only at China but at the whole world, to protect the domestic industry.
SA's import restrictions came about in a controversial way — the quotas were not negotiated with industry but with the Chinese government directly.
Sources confirmed that initial plans by the International Trade Administration Commission to institute a safeguard against clothing imports from China — a standard trade remedy to deal with an import influx — were reversed by the government after high-level political intervention by China.
Instead of imposing an official safeguard, SA and China came to an understanding on a package of issues, which included an agreed curb on clothing imports.
The deal also included a package of investment commitments from China. In return, SA granted China market economy status and agreed to enhance debate on anti-dumping.
The plan was met with outrage from retailers but a representative of the local manufacturing industry, who declined to be named, recently also lamented the quotas, saying the intervention came two years too late.
Inexplicably, the trade and industry department also failed to implement a recapitalisation programme for the battling clothing and textile industry during the two-year window provided by the quotas.
It is understood that the action plan will be implemented only in November — a mere month before the expiry of the curbs on Chinese imports.
Setting out the objectives, the terms of reference for the study call for an assessment of the effect of the quotas on the economy; identify key challenges and obstacles caused by the quotas; and call for recommendations for appropriate actions.
The National Clothing Retailers' Federation executive director Michael Lawrence said he had heard about the study and that the federation would want to participate.
“We recognise the need to keep a close eye on imports but reiterate our concerns about illegal imports.”
Source: Business Day
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