The ReDress Consultancy releases this letter addressed to Minister Patel from the owner of one of the few remaining South African textile mills. The letter highlights a number of concerns but it also breaks a very disturbing story concerning the SABS and a Chinese textile mill.
The SABS refused to comment on the story after being approached by The ReDress Consultancy. We can confirm that the clothing and textile union Sactwu, have already met with the SABS and will be having a further meeting next week.
The ReDress Consultancy feels that this letter highlights some important issues that have not been raised in the current discourse pertaining to the restructuring of wages within the clothing and textile sector. We will shortly be posting the letter on our website and encourage your comments. We also, provide you with the contact details of the Minister’s office.
Ministry of Economic Development
Private Secretary: Ms Aldene Appolis
Tel: (021) 466 9800 / (012) 394 1006
E-mail: ministry@economic.gov.za
Patel’s plan between a rock and a hard place.
As the owner of one of South Africa’s few remaining textile mills it is clear to me that minister Patel’s new growth plan is between a rock and a hard place. I welcome the new plan and its ambitious targets, however, there are some issues and concerns relating to the growth plan that need to be taken into account.
While the minister is involved with a developmental plan to establish an accord with the textile and clothing industries he must take into consideration the significant negative influence that has resulted from globalisation and a free market economy in these industry sectors.
It is imperative that the minister acknowledges the ongoing erosion and damage that has and is occurring due to the inability of the authorities to control illegal and under-invoiced goods. One solution to eradicate this scourge that plagues the industry is to introduce specific duties on imports and to ignore some aspects of WTO regulations, as Brazil, Turkey and Egypt have done. This system of duties discourages under invoicing and curtails the importation of distressed goods.
The fact that the clothing sector, despite the numerous incentives afforded them, are now advocating for duty rebates on fabrics not made in South Africa will lead to the final death knell of the textile sector. I am concerned that the authorities will not be able to monitor and manage this proposal and we may experience a surge of false declarations and under-invoicing of textile imports.
The fact that we are having to compete with Asian companies that are heavily subsidised, the lack of capacity by our authorities to curb illegal imports, the volatile currency, and uncompetitive labour market, creates a fertile environment for traders and retailers to cruelly exploit the best deals available to them, in a globalised market.
It is common knowledge that a single trader equipped with a computer and an air ticket can seal deals that have immense collateral damage to both the apparel and textile manufacturing sectors. A single trader who does not create significant employment can wipe out a swathe of local businesses.
It is my concern that in order to address the chasm created between the compliant and non-compliant sections of the clothing industry, minister Patel seems intent to force non-compliant companies to abide by the bargaining regulations, by placing barriers, that precludes them from taking advantage of the intended rebates. In effect, this will allow for further instability and unfair competition within the apparel sector as compliant companies will be in a position to import cheaper fabric at the detriment of the local textile industry.
The fact that the very government, which is attempting to find a way forward for these distressed sectors has allowed state institutions like the South African Bureau of Standards (SABS) to accredit a Chinese textile mill the license to produce and export fabrics for workwear that is used in the mining sector, to carry its seal, instead of supporting the local textile sector, is of serious concern.
I would like the esteemed minister to consider the following as a way forward:
All trading of imported goods should be confined to bona fide manufacturers in the different disciplines. By way of an example, spinning mills would trade in yarns, textile mills in fabrics and clothing manufacturers in clothing. The objective here is to cross-subsidise so as to grow the manufacturing base. In order to ensure that the manufacturing base is not diluted in favour of trading, a system is derived whereby the quantum of trading is linked to employment levels, remunerative contributions, training and manufacturing output etc.
I think that this proposal would go someway to stemming the tide of deindustrialization.
Mr. Marcus Varoli Chairman
MEDITERRANEAN TEXTILE MILLS (PTY) LTD.
Tel +27 31 736 2015 Ÿ Fax +27 31 736 1497
E-mail medtext@mtm.co.za
Web http://www.mtm.co.za/
Reference: The ReDress Consultancy @ 4 Dec 2010
6 comments:
Tracking Patels performance over the last few years- only thing visible is the destruction of the clothing industry. accredtiting a Chinese mill smells like a sell-out.
Regards
Hello
It is with interest that I read the story on the alleged SABS approval of a Chinese textile mill for fabrics used for protective clothing.
As a former production director involved in the manufacturing of textiles in South Africa and a person with a passion for textile manufacturing I often share my “Plan for recovery of textile manufacturing in South Africa” with anyone that will listen. “The Plan” involves focusing on high volume production of one basic fabric and fine tuning its production, in a minimum number of colours where colour matching is not critical. Take this fabric and use to produce a basic range of non-fashion workwear garments in a minimum number of styles that are sewn by hand but produced in sufficiently long runs to perfect the operators’ skills allowing them to compete internationally….. and so on. The same fabric could be the base for printed defence force and police force garments.
I have wondered for years why “country of origin” labelling was not enforced on workwear? Surely our Unions have been in the perfect position to enforce such laws and to conduct defiance campaigns against companies that provide their members with imported apparel?
I gave up wondering and changed careers after 25 years. Starting again has not been easy and I am often asked if I would go back. The answer? If I believed that there was a real plan in place I would cherish the opportunity to be part of a plan to create hundreds of thousands of jobs in a country that truly needs employment; Firstly, a clothing industry, and then a textile industry to back it up!
Good Day
On behalf of Minister Ebrahim Patel, Minister of Economic Development Department, I hereby acknowledge with thanks receipt of your email dated 4 December 2010.
We will bring the letter to Minister Patel's attention, and revert back to you.
Regards,
Reneilwe Hlongwane
Office of the Minister of Economic Development
Tel: 012 394 1006
Fax: 012 394 0255
Email: rhlongwane@economic.gov.za
It is with great interest that I have read the comments - I am pleasantly suprised that now we have the textile industry also in the fray as previously their voice was somewhat quiet - perhaps waiting to see what will happen to the clothing counterparts.
As can be seen from the comments - the issue is wide spread - our textile industry is near collapse - our clothing industry is in near collapse - the union cries fowl but has no concrete plan that is near workable - how can you resurrect an industry or country without talking about labour rates and wages - from what can be seen with the DTI response is that they are not accountable or responsible for anything - the bulk of our fabric that we use is from abroad - there are many factors which play a role in that - some of which is price, felixbility, and lead times.
Maybe HCI and SACTWU should invest in the textile industry too and perform the miracles they have with Seardel, it would certainly boost our neighbouring states economies and employment figures.
The plans for recovery need to be simple and concise - the bulk of the manufacturing base is owner run, with little admin capability to handle complex implementation and maintainance of that plan. The simpler the plan the better the implementation and policing.
We can't afford to have a plan that only Steven Hawkins would understand
Dear Mr. Varoli,
I heard from Mr. Renato Palmi of ReDress Consultancy about the recent decision of SABS and the Department of Trade and Industry’s (DTI) move of granting a Chinese firm with a certificate of approval allowing it to export work wear fabric which is to be used in the mining industry of S.A.
I am concerned with the consequences of such a decision, which is maybe the first of this nature but if not stopped, it will create a series of similar practices.
Today, when the trade liberalization hit the African continent employment so hard, and the effort of the entire world is concentrated on erradiculation of the poverty on the continent, such news cannot disturb us.
They are even more disturbing because there is no rational logic that can prove that this decision is in the advantage of the nation and its taxpayers. Because the price advantage of a foreign company cannot be compared with the social and economic contribution of the local industry to the national wealth.
I believe that this news is not coming at the right moment when the S.A. government is trying to build the nation brand. The nation brand is created mostly by its people and we, the people from the outside world, form our perceptions about a certain country from the news coming from it. When the news is disturbing it creates noise and any other communications for the country brand will have to come through this noise.
Please keep me posted on the developments of this issue and I hope that the concern and the support of the local and the international textile industry community will help to bring these business and sustainability back to your country.
Sincerely,
Robert Alexandriysky, founder the group TO AFRICA WITH FASHION on LinkedIn
founder, honorary member of the Managing Board of Bulgarian Apparel and Textiles Exporters Association
P.S. This letter expresses solely my understanding and concerns and does not involve the organizations with which I am related and mentioned above.
Renato, the very industry association that is meant to care and advocate for the Textile Clothing Sector will most probably respond next year when not only the fabrics, but the whole garment will be Made in China. The greedy people will not stop here.
The most probable reason for the silence of the Federation is that the mill producing the fabrics is not their member. Then they think, this is not our business. But organizations today have to behave like they have a conscience, not only rules. And their conscience of citizens should call them for an action today. I would support you if you think that our group address will help to raise the awareness on the issue and bring the authorities on the table for discussions.
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