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Are import tariffs killing local clothing and textile industry?

6 July 2019 11:08 AM
Tags:
Clothing and textile industry
buying south african
The International Trade Administration Commission's Meluleki Nzimande explains how tariffs on raw materials work.

During his State of the Nation Address, President Cyril Ramaphosa encouraged South Africans to buy local, proclaiming that his own suit originated from Cape Town-based company, House of Monatic.

However, during an interview with CapeTalk, managing director Aldo Agnello pointed out that the worsted wool used to make Ramaphosa's suit was imported - there is only one worsted wool mill left in South Africa and it does not not supply the fashion industry.

RELATED: [LISTEN] The challenges of producing and buying 100% local clothing

On Weekend Breakfast, Africa Melane chats to Meluleki Nzimande, chief commissioner of the International Trade Administration Commission about the challenges facing the local industry specifically with regard to import tariffs.

Nzimande explains the objectives of the commission, noting that South Africa is part of an international trading system bound by the rules of the World Trade Organization (WTO).

Our objective is to intervene in the economy in a manner that supports economic growth and fosters the growth in investment as well as income.

Meluleki Nzimande, Chief commissioner - International Trade Administration Commission

All our activities are informed by that aspect and by what South Africa has bound itself to the World Trade Organization in terms of trade defence instruments and other things.

Meluleki Nzimande, Chief commissioner - International Trade Administration Commission

In practical terms, he says, lowering input costs would be done through removing import duties completely or providing rebates for those duties paid.

Nzimande describes this as a 'general approach', which is not applied in every case.

He points out that when it comes to wool imports, these tariffs apply only to dyed wool.

For instance dyed wool in particular, attracts an import duty of about 8.5%, generally... but dyed wool imported from the EU, SADC region comes in duty-free.

Meluleki Nzimande, Chief commissioner - International Trade Administration Commission

We will impose duties where there is local industry and where we want that local industry to grow.

Meluleki Nzimande, Chief commissioner - International Trade Administration Commission

For more detail, listen below:


6 July 2019 11:08 AM
Tags:
Clothing and textile industry
buying south african