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SA Clothing Industry can be Profitable - Levi Strauss
The strong performance of the Levi clothing factory in Cape Town, one of only five Levi-owned factories left in the world, over the past few years shows that the local clothing industry can be profitable while maintaining global best practice operationally.Although tens of thousands of jobs have been lost in South Africa's clothing and textiles industry in the past three years as factories have closed their doors in the face of stiff competition from China and elsewhere in Asia, the Levi factory at Epping has gone from strength to strength,...
SACU-US Trade Talks: The 'One Size' Pact That Doesn't Fit All
Several business and nongovernmental organisations lay the blame for what some describe as a halt in free-trade talks between Southern African Customs Union (Sacu) and the US at the door of the world’s largest economy. The US’s approach to the talks has been seen as inflexible by it asking Sacu members SA, Namibia, Botswana, Lesotho and Swaziland to sign up to the “template” that the US applies in free-trade talks with other countries or blocs, rather than engaging in real negotiation. US negotiators’ hands are somewhat tied by...
Uganda: New Coffee Firm Leases Bugolobi AGOA Plant
A new coffee-processing company, House of Uganda Coffee Ltd., has won a 49-year lease to use part of the former Coffee Marketing Board premises at Bugolobi. Uganda Property Holdings Ltd, the custodian of most government properties, granted the lease for which Uganda Coffee will pay an annual rental fee of Shs56m. The company will share the premises with Apparels Tri-Star, the firm that produces textiles for the United States market under the African Growth and Opportunity Act, Agoa. With the Shs6 billion it plans to invest in processing...
Kenya: Trade Gap With U.S. Widens As Textile Sales Fall
A drop in Kenya's textile exports to the United States contributed to a large trade imbalance between the two countries last year.New figures show that the entry of Asian countries into the competition for the US textile market has already cut gains made by the Kenya and the US in the last two years to narrow the trade deficit. with statistics from the US commerce department.The data from the US Commerce department shows that Kenya's textile and apparel sales to the US under the preferential terms of the Africa Growth and Opportunity Act...
US Committed to Strengthening Trade Relationship with SACU
This year presents a number of opportunities on the global trade front for the US and the countries of the Southern African Customs Union (Sacu).First, there is the Doha development round, a once-in-a-generation opportunity to liberalise world trade and stimulate economic growth and development.As a leader of the developing world, South Africa has an important role to play in pushing these World Trade Organisation negotiations to an ambitious outcome. We must work together to ensure that this opportunity to improve the global economy and...
SACU-US: United States 'Not Budging' on Trade Talks
The United States hopes to agree a road-map with southern Africa on reaching a trade pact this week but will not budge on key issues that have previously stalled talks, a top official said on Monday.Deputy US trade representative Karan Bhatia said he hoped talks on Tuesday with the Southern African Customs Union (SACU) - which comprises South Africa, Botswana, Namibia, Swaziland and Lesotho - would yield a plan for boosting trade.No compromiseBut he said the US would not compromise on issues like intellectual property, government procurement...
Kenya: US to Help Make Goods Competitive
The US is ready to help Kenya reduce the cost of production, which makes the country's exports unable to compete in the international markets.Deputy US Trade Representative, Karan Bhatia, said in Nairobi that the cost of production in Kenya is making the country's products unable to compete with those from China in the US market.Bhatia, who was in Nairobi for the meeting of African Union Trade Ministers, also said Kenya should diversify its exports to the US."The US has increased its aid dedicated to boosting trade in Africa. It should make...
Loss of Textile Market Costs African Jobs
All across Africa, textile producers and exporters are reeling from the impact of new trade rules that took effect in January 2005. The rules, negotiated at the World Trade Organization (WTO), opened up to market forces a sector that had been protected for more than 30 years. It did so by ending a quota system in industrial nations which as a side effect had provided a ready market for textiles and apparel from poor African and other developing countries.The phasing out of the old system has already cost Africa more than 250,000 jobs over...
Statement by the USTR at the African Union Trade Ministerial
Ambassador Bhatia: First, on behalf of the United States, I would like to convey our deepest condolences to the government and people of Kenya on the recent air crash tragedy. Our thoughts are with the families of those who were affected.I want to thank our co-hosts -- African Union Trade Commissioner Tankeu and Kenyan Trade and Industry Minister Kituyi -- for inviting the United States to participate in this ministerial meeting. Let me convey warm greetings from President Bush and from Ambassador Portman, who very much wanted to be here...
Ethiopia: Export to U.S. Under AGOA Growing
A USAID-funded programme working on the African Growth Opportunity Act (AGOA) VEGA Ethiopia said that the country's export to the US under the initiative is steadily increasing.In an exclusive interview with The Ethiopian Herald yesterday, Programme Chief of Staff Addis Alemayehu said that Ethiopia exported items worth of 700,000 dollars in 2001 growing to 1.7 million in 2003. In 2004 and 2005 the country exported goods worth of 3.3 and 3.6 million USD respectively.Currently, Ethiopia ranks 19th among the 37 AGOA eligible countries in terms...
Namibia: Rumours Rattle Ramatex
Fears are intensifying among workers that Namibia's biggest textile manufacturer, Ramatex Textile Factory, plans to scale down operations dramatically, if not shut down its Windhoek operations completely.Workers are on tenterhooks as reports swirl that as many as 3 000 of them could face retrenchment and that equipment from the factory buildings are being packed into containers and shipped out of the country.Prime Minister Nahas Angula told The Namibian on Wednesday that the situation was "worrying", but that the factory had to be given the...
South Africa: Mercedes Hopes for AGOA Benefits on Exports to US
Daimler Chrysler SA, which yesterday reported record revenues of R27,5bn for last year, will become the second car maker in SA to export to the US if it qualifies for benefits under that country’s Africa Growth and Opportunity Act (AGOA).US customs authorities will make a ruling in the next three or four weeks on whether local content in the Mercedes Benz C-Class that the car maker is looking to sell in the US is sufficient under Agoa criteria to qualify for lower import duties.This did not necessarily mean that the car maker would...
Tanzanians Shy Away From AGOA
Tanzanian business investors have been advised to put some efforts to explore the US-sponsored African Growth and Opportunity Act (AGOA) markets like other investors from Kenya and Uganda.The Chairman of East Africa Business Council (EABC), Mr. Anorld Kileo on March 13 said unlike its counterparts Kenya and Uganda, Tanzania was lacking behind in selling its products in AGOA markets despite being given additional time. He was addressing the Regional Meeting on Investment Promotion held at the Arusha International Conference Centre.He noted...
Ethiopia: A Look at the Garment Industry
The garment industry in the country has become one of the most growing industries. Many business people are engaged in the industry and have become successful. Despite its huge potential and strategic significance, the sector is still at an embryonic stage of development. That is, the performance of the sector is very low.Ato Elias Meshesha, general manager of Spectrum Garment Industry, who has worked in the garment industry for the past thirty years and is an expert on the subject, said that garment industries in their country are still in...
South Africa: Textile Company Stays Afloat due to AGOA
Southern Textiles, a Durban-based company that manufactures for the clothing, shoe, luggage and upholstery industries, has lost about 40 percent of its revenue to Chinese imports, but has still managed to remain successful because of its flexibility."The clothing industry has been the worst hit but luggage has been doing fine and upholstery has done very well," Robert Patchappen, the director, said yesterday.The trimming manufacturing company, which operates on a 24-hour basis and has a staff of 120, has been struggling against Chinese...
Uganda: Textile Industry Receives Boost
Uganda has moved a step ahead in beating the September 2007 expiry of third party fabric sourcing under the AGOA initiative by clinching a deal with an American investor to set up a spinning, weaving and dying mill.The new $20m (about sh36b) investment is a joint venture between Apparels Tri-Star and ISIS Pacific Capital Inc, a New York-based textile and garment company.The proposed mill will be set up within the existing Tri-Star premises at Bugolobi in Kampala within six months, James Langford, the Pacific Capital president, said last...
Uganda: Tristar Apparel Gets $20m Boost in Joint Venture Deal
ISIS Pacific Capital, a US-based company is set to invest $20m (about Shs36.2b) in Uganda's apparels sector.Meeting President Yoweri Kaguta Museveni at State House, Nakasero on March 9, the company's Chief Executive Officer, Mr James Langford said the firm plans to inject the money in Uganda to boost the country's textile sector.According to the press statement, Langford said ISIS Pacific Capital was making preparations to make a joint venture in the textile industry with Uganda's Apparels Tristar Ltd.The textile expert said the funds would...
Kenyan Exporters Tipped on US Market
Kenyan entrepreneurs were yesterday petitioned to increase exports to the United States market that is valued at Sh4 billion annually.Matanda Wabuyele, the Export Promotions Council chief executive, also called for diversification of the range of Kenyan exports to value added components."The challenge exporters face is not just increasing volume of exports to US, but also diversifying the range of exports by ensuring there was more value adding," he said. Wabuyele made the remarks during a workshop on doing business with US at a Nairobi...
South Africa: Clothing Industry Sounds the Alarm over Critical Mass
The clothing industry is perilously close to minimum critical mass and if the dramatic surge in undervalued imports is left unchecked, could decline to the point where the sector is no longer of any interest to global sourcing companies.This is the view of Jack Kipling, the chairman of the Export Council for the Clothing Industry, who said the sector could also decline to the point where it was unable to support the local textile and components suppliers, such as zip and thread manufacturers."The only way to avoid this," he said, "is if...
SACU: Continued Opposition to Trade Deal with US?
Trade experts say the United States is demanding far deeper market access than South Africa is willing to give, particularly in the area of services that are covered by regulatory protection rather than tariffs.South African business appears to be waking up late to the fact that the country may be walking away from a free trade deal with the US.“It makes far more sense for South Africa to negotiate a free trade agreement with a high-wage country like the US than a low-wage country. The benefits to our economy would be huge,” says Philip...
USAID Helps Uganda's Roses Break Into US Market
Rosebud Limited, a Ugandan company, delivered its first shipment of 500,000 roses to the United States early in February, in time for the floral industry's busy season, the U.S. Agency for International Development (USAID) announced February 22."This is a perfect example of the U.S. commitment to Africa," said Lloyd Pierson, assistant administrator for USAID's Bureau for Africa, in a recent USAID press release. "Through our expertise, USAID is building partnerships to create sustainability and drive economic growth. This is a remarkable step...
South Africa: Trade Team in U.S. in Bid to Revive SACU Talks
A Delegation from the trade and industry department is in the US this week on a mission to save the stalled trade talks between the Southern African Customs Union (Sacu) and the US.Local trade experts said yesterday that the mission came amid growing signs that the US may put the talks on the back burner if they were not concluded soon.The delegation, led by the department's acting director-general, Tshediso Matona, is in the US to meet that country's trade officials on the state of the bilateral talks between the US and Sacu, which...
Ethiopia: AGOA Earnings Growing
The earnings of Ethiopia from AGOA, the African Growth and Opportunity Act, have been growing steadily, according to the Ministry of Trade and Industry.Information and Public Relations Head with the ministry,Hailu Abebe, said when the preferential access to the US market was extended to Ethiopia in 2001, the country got 822,000 USD only .The amount reached four million USD in 2004 and is even better in 2005,even if the sales report for the year is not yet ready.Despite sales of apparel, wooden sculptures, handicrafts works, businessmen...
Lesotho's Tax Plan Boosting Apparel Exports
Lesotho’s recent announcement to cut company tax on income derived from exports is a considered move to preserve the country's vital apparel industry. Indeed, the cut in tax to zero for income earned from exports outside of the Southern African Customs Union represents a purposeful step to support the successes of an apparel industry dedicated to exports and creating jobs in a country desperate for employment.Globalisation presents opportunities for developing countries -- but harnessing these requires a different kind of partnership...
Zambia's Trade Climate Elates US Ambassador
Carmen Martinez (United States ambassador to Zambia) said that Zambia is now open for business since the provision of a conducive atmosphere for private sector growth by the government.Meanwhile the Zambia State Insurance Corporation (ZSIC) has provided US$1 million to Freshpikt, a fruit and vegetable canning factory that has opened in Lusaka to process canned beans, pineapples, tomatoes, guava, tomato paste and glucose, among other products.Ms Martinez said in Lusaka yesterday during the launch of Freshpikt, that the many activities in the...
Uganda Underperforms under AGOA in 2005
Six years since the inception of the African Growth and Opportunities Act, Uganda's performance has been least impressive in East Africa.The United States-Sub-Saharan Africa Trade data authored by the US Trade Commission puts Uganda last after Kenya and Tanzania in last year's performance.Uganda made total earnings from exports to the US worth $25.8m in 2005, down from $34.8m in 2003. Tanzania's earnings grew from $24m (2003) to $34m(2005) and Kenya from $249m to $348m respectively.The US attributes the poor performance of Uganda and other...
Uganda: Website to Market Textiles Launched
In a bid to enhance Uganda's performance in the African Growth Opportunity Act, a website has been launched to provide information about the country's textile potential.The website has been launched by the Uganda Investment Authority (UIA) and contains details of the textile industry.It is intended to provide information of industry players, cotton production, jobs and other related information.She was seeing off six companies on February 13 that are to represent Uganda at a textiles exhibition in the US. Southern Range Nyanza, Apparel...
USTR Says US is Re-Evaluating Interest in FTA with SACU
U.S. Trade Representative Rob Portman this week held open the possibility that the U.S. would reconsider continuing formal negotiations with members of the Southern African Customs Union over those countries' failure to agree to the scope of a deal."We don't want to walk away by any means if there's interest," Portman told reporters following a Feb. 7 speech on African trade issues. "We will continue to be there to engage but we have to keep our standards up high." Portman said the U.S. is continuing to push for an agreement that includes...
Uganda: Government to Revive Spinning Mills Ahead of AGOA Deadline
Uganda's Government has intensified efforts to revive cotton spinning mills in order to beat a 2007 African Growth and Opportunities Act (AGOA) deadline that prohibits beneficiary countries from using imported raw materials for their US-bound exports, writes Mary Karugaba.Under the current arrangement, countries can import textiles and stitch the apparel together for export like Uganda has done for the last four years.Cankwo Okulo, the principal industrial officer in the trade ministry, said Uganda had been importing some raw materials like...
Lesotho Scraps Tax to Boost Rag Trade
Lesotho Finance Minister Timothy Thahane yesterday announced a zero tax rate on certain of its clothing exporters in a move intended to diversify the country’s export range.Thahane’s statement was in response to a number of investors who opted for SA’s lower general company tax rate, instead of that of Lesotho.“To put an end to firms taking advantage of the lower tax rate in SA and to further improve (Lesotho’s) competitiveness, Lesotho is reducing the general company tax rate from 35% to 25% effective from April 1,” the minister...
Namibia: Report Queries AGOA Benefits
Concerned that the Africa Growth and Opportunity Act (AGOA) is a temporary trade arrangement, there is feeling that Namibia should rather further diversify its export markets and move away from any AGOA dependency.AGOA, which is an arrangement initiated by the United States of America to benefit Sub-Saharan African countries, encourages trade and investments between the US and Africa through reduction of tariff and non-tariff barriers.The Act offers tangible incentives for African countries to continue their efforts to open their economies...
South Africa: Clothing and Textile Sectors Cheer Presidential Speech
South Africa's President Thabo Mbeki's generally upbeat, but short on concrete detail, state of the nation address to parliament on Friday has been broadly welcomed by the beleaguered clothing and textile industry, which is likely to be the first to benefit directly from the government's more proactive approach to growth.Giving broad details of the accelerated and shared growth initiative for South Africa (Asgisa), Mbeki said that nine specific sectors - business process outsourcing, tourism, chemicals, biofuels, metals and metallurgy, wood...
Uganda: First Flower Crop Enters US Market
As Ugandan flower exporters continue to explore alternative markets for their cut flowers, the exporters have penetrated the US market for the first time. On Tuesday, the first consignment of over 500,000 hydroponics roses from Rosebud Ltd left for the US aboard a KLM flight. The shipment was witnessed at Entebbe International Airport by the Executive Director Uganda Flower Exporters Association (UFEA), Mr Keith Henderson, United States Agency for International Development (USAID) Agricultural Advisor, Mr James Dunn, Agricultural...
South Africa: China Remains a Threat to Textile Sector
China was not the root cause of the problem facing the clothing and textile industries as retailers would simply buy from other low-cost Asian countries if imports from China were curbed, Hoosen Rasool, the chief executive of the clothing, textile, footwear and leather sector education and training authority said this week.The real problem, he said, was that the industries were stuck in market segments dominated by low-cost Asian manufacturers."Any possible reduction of imports from China will likely provide only fleeting relief to the...
Textiles: China Voluntarily Cuts Back Exports to South Africa
South Africa's beleaguered clothing and textile industry was thrown a potential lifeline yesterday when China announced it would voluntarily curb the exports of its textiles and clothing to South Africa."China will voluntarily limit the export of garments and some textile items to South Africa," said the Chinese ambassador to South Africa, Liu Guijin. Liu was presenting China's Africa policy to African diplomats, international analysts and the media in Pretoria.The department of trade and industry has been in protracted talks with its...
Africa's Export Growth Highest Since 1980
Riding a wave of higher oil and commodity prices, and vigorous global trade growth, including recovery in trade in office and telecommunications equipment, developing countries saw their share in world merchandise trade rise sharply in 2004 to 31%, the highest since 1950, according to WTO figures released in 2005.However, a marked slow-down in overall economic growth that began in the second half of 2004 is likely to decelerate world merchandise trade growth from 9% in 2004 to 6,5% in 2005, WTO economists say.“As trade continues to play a...
Uganda Gears Up to Beat End of Fabric Provisions
Uganda's AGOA office is working around the clock to have a spinning mill ready before the expiry of third country fabric sourcing in September 2007."We need to have our own fabric source by then, otherwise all these mushrooming textile factories will close shop," Susan Muhwezi, the special presidential assistant on AGOA, said last week.She said Gherzi, a Swiss firm had been contracted to look at the viability of setting up a spinning mill."We need to be at the point of producing yarn for export and local use by September 2007 so that the...
China: Textile Trade Up 20%
China enjoyed an estimated 20% rise in revenue, profits and exports in 2005 despite trade rows with the US and the EU, according to a report from the China Chamber of Commerce for Import and Export of Textiles cited by Xinhua news agency.Sales revenue for the year totalled CNY2trn (US$250bn) as profits reached CNY66bn and exports were CNY116bn.The chamber said the increases had been driven by a ramp up in investment into fixed assets as well as technological innovations.Sales, revenue, sales value and industrial added value of large-sized...
Swaziland Fails to Make Trade Preferences Count
Is the African Growth and Opportunity Act (AGOA) dead in the water? Many Taiwanese garment manufacturers in Swaziland believe it is.On a research trip to Swaziland last week for the Brenthurst Foundation, I witnessed a fairly bleak picture emerging.With all the hype about China's unfettered entry into the global textile trade and the attendant problems for other exporting countries, it seems other important considerations of competitiveness and sustainability need to be considered.The strong rand was at the top of the list of problems the...
USA: Legislators Outline WTO Textile Concerns
Twenty-four members of the US House of Representatives sent a letter to President Bush yesterday (8 December) urging the United States to take a strong stand on two textile-related issues at the upcoming World Trade Organisation talks.The Members want the US to oppose a European Union-led initiative to grant Least Developed Countries (LDCs) duty-free and quota-free access to all developed markets.They are also seeking a Special Textile Sectoral (STS) that would cover textiles and clothing within the non-agricultural market access (NAMA)...
Uganda: AGOA Under-Used
Uganda has failed to fully exploit the African Growth and Opportunities Act (AGOA), a US tariff and quota free initiate, Moses Byaruhanga, the presidential advisor on political affairs, has said.Byaruhanga said the Government was expanding market to increase employment."Apparels Tri-Star, the leading beneficiary of AGOA, has employed only 2,000 people. Other firms have failed to command regular production to exploit the vast American markets," he said.Byaruhanga , who was on Saturday addressing Mukono Christian University students at Bishop...
Sierra Leone: Chamber of Commerce Says AGOA Enhances Africa Trade
Blanche Gooding, Treasurer of the Sierra Leone Chamber of Commerce Friday disclosed that the African Growth and Opportunity Act (AGOA) was designed to enhance trade in Africa.Gooding who was speaking at a press briefing at the Chamber's Guma Building office says the Act provides unprecedented opportunities, which is aimed to promote increased trade and investment between United States and African countries, and also increased access and opportunities for US investors and African countries."The AGOA Act offers opportunities and encourage...
Southern Africa: SACU-US Agreement Could Build On AGOA
The stalled free trade agreement between the US and the Southern African Customs Union (Sacu) will fail unless South African business pushed the country's trade negotiators.This warning was issued by Duane Newman, the automotive industry group leader and a partner at Deloitte, who said African countries were questioning why they should care about this proposed agreement when they had the African Growth and Opportunity Act (Agoa).But Newman warned at a briefing on Friday hosted by Ford Southern Africa that this attitude was dangerous.Agoa is...
Ethiopia Seeks to Maximise AGOA Benefits
Various activities have been launched in a bid to enable Ethiopia benefit the most out of the African Gross Opportunity Act (AGOA), Ministry of Trade and Industry said.The country is not exhaustively utilizing the opportunity of AGOA though it is steadily increasing the volume of exports, information and public relations office head with the ministry Hailu Abebe told ENA yesterday.Oracle Business IntelligenceHailu said lack of competitiveness in the international market both in quality and price of products, lack of skilled manpower, and...
U.S. Drops Pending Quota Applications on Chinese Textile Imports
The US government on Wednesday dropped all pending decisions to impose quotas on Chinese textile imports after the two nations clinched a deal to regulate the trade.The Commerce Department said all 24 outstanding requests by US industry groups for so-called safeguards on textile imports had been scrapped in light of the agreement reached two weeks ago.Franklin Lavin, undersecretary of commerce for international trade, said the agreement "establishes conditions on trade in the vast majority of products covered by these cases"."Based on these...
South African Exporters Welcome US-China Textile Pact
The SA Clothing Industry Export Council has welcomed the US-China textile bilateral agreement that in effect reintroduces quotas on 34 categories of clothing and textiles until 2008. The agreement will result in renewed interest from US retail companies in sourcing from South Africa and other sub-Saharan African countries.South Africa's exports declined by 38 percent this year following the lifting of the Multi-Fibre Arrangement (MFA) on January 1. The end of the MFA strangled trading opportunities with other clothing manufacturing countries...