SA Govt to tackle imports & Lesotho workers want more

RECOMMENDATIONS by the National Economic Development and Labour Council (Nedlac) to combat customs fraud in clothing, textile and footwear imports could produce useful gains, but an over- zealous attempt to eliminate trade-related transgressions would do more harm than the problem itself, University of Cape Town school of economics professor Don Ross said this week.

SA’s clothing, textile and footwear manufacturing industries have been struggling to compete with cheaper imports for many years, but particularly so in the past couple of years when some large businesses have been forced to close. Suggestions to save the industry range from higher import tariffs to stricter control at borders.

Nedlac released its report last week after a three-month probe. It looked at all forms of customs fraud including under-invoicing, false declarations, misuse of duty rebates and corruption by officials. The report has now been submitted to the relevant Cabinet ministers.

Nedlac’s key recommendations were that customs officials be armed with a reference pricing mechanism so they could recognise under-priced imports, and that seized goods be disposed of in a way that would not disrupt the South African market. The task team considered having dedicated ports of entry for these goods but noted the South African Revenue Service and the Department of Trade and Industry were still preparing a policy on the issue.

Although customs fraud was generally punished by fines because this was the fastest method, the task team said criminal action should be pursued in certain cases, depending on the value involved. They also emphasised the need for stricter enforcement of rules of origin because Southern African Customs Union members were being used as conduits for imports at lower duty.

Some of the recommendations requiring legislative changes should be incorporated into the Customs Act, which is being revised, they said.

Ross said most of SA’s clothing producers, aside from some speciality firms that make high-value- added products for niche markets, could not compete with imports from Asia and Lesotho (see story below) even if all illegal activities associated with the border were eliminated .

Most of the border smuggling was of cheaper items, which were unlikely to be seen as a priority by customs officials dealing with drugs, arms and stolen goods, Ross said.

Nedlac’s suggestions of creating dedicated ports or sector-specific import permits could give rise to costs that would exceed the benefits they would produce.

“Of course it’s reasonable to co-ordinate and tighten up international monitoring of rules of origin. However, it should be borne in mind that all such rules are notoriously loophole prone, always and everywhere,” he said.

“We shouldn’t forget that among principal beneficiaries of under-invoicing and smuggling are poorer South Africans who save money on a non-optional consumption item that takes up a larger share of their expenditures than is the case for middle-class or rich people,” Ross said.
Ref: Business Day: C. Mathews. 26/9/09

LESOTHO Sept 09
MASERU – Workers in the apparel industry are demanding a M1,500 monthly take-home pay and a review of their working conditions.

Worker representatives from several major apparel factories in the Thetsane Industrial Area this week petitioned the National Assembly portfolio committee overseeing labour issues to seek a pay hike.

The workers, who represented Suntextiles, C&Y, CGM, Santikon and Tai-Yuan textile companies, handed the petition to portfolio committee clerk ’Mankopane Thabane.

However, Thabane could not receive the petition in person as she was said to be tied up in other office engagements. Portfolio committee chairperson ’Matšotetsi Mpesi was also reportedly ill.

Present in a show of solidarity were Lesotho Workers’ Party legislators Sello Maphalla and Rosa Lenea.

Factory Workers’ Union officials present at the handing over of the petition told Public Eye that it was the beginning of a larger campaign to force government to heed their requests.

“We agreed that only a few representatives will bring the letter of grievances to the House, but a massive show of force to see this petition attended to is in the offing,” said Seabata Likoti of FAWU.

He said factory employees work in the most disheartening conditions and had nothing to show for it, a situation he said needed redress.

The Labour Code Wages Amendment Order of 2008 puts the minimum wage for a textile general worker at M741; a textile machinery operator is paid M797, while a textile machine operator trainee earns M741 a month.

Employees with more than 12 months of continuous service with the same employer (trained machine operators) are set a monthly income of M839, while a textile general worker pockets M790.

In their plea for better working conditions, the workers also demand that: their terminal benefits be untaxed; that the six weeks’ maternity leave applicable for factory workers be reviewed to bring it in line with the three months enjoyed by other sectors; and that the labour minister should take familiarisation tours of the factories at least twice a year to appraise himself of the working conditions of the workers.

In addition the workers want their working hours be reviewed, with a view to shortening them to the normal eight-hour day starting from 8am to 5pm, and that their general working conditions, inclusive of machinery, clothing, cooling and heating systems, be standardised to ensure safety.

Ref: Public Eye Newspapers