TRALAC - Trade Law Centre

Foreign Fabrics Would Give South Africa the Edge

Tuesday, 19 July 2005

Source: Business Day (Johannesburg)

Unless South African clothing manufacturers are allowed to source fabrics from other countries, the local industry will not be able to reap maximum benefits from the Africa Growth and Opportunity Act (Agoa), according to the Export Council for the Clothing Industry in SA.

In a statement to the council's members ahead of the Agoa forum currently under way in Dakar, council chairman Jack Kipling said SA's exclusion from the favourable "third-country fabric provision" of Agoa, negatively affected the local industry.

The "third-country fabric" provision allows the poor sub- Sahara African countries such as Lesotho to use fabric bought from outside the region and still qualify under Agoa.

The provision, which was inserted in the US legislation in 2002, allows the countries to reduce their raw material prices by buying the cheapest fabric.

SA and Mauritius are, however, excluded from the clause because they are not regarded as least-developed countries.

"Without liberal and unfettered access to third-party fabric, sub-Saharan Africa will never be able to develop an apparel manufacturing sector of sufficient critical mass to be a serious player in the global market nor support a viable textile industry in the future," Kipling said.

He said the council wanted entry of garments into the US under Agoa to be on a "single-stage conversion" basis whereby a product would need only to be wholly manufactured in an Agoa-eligible country to qualify.

Kipling said that SA and Mauritius should be treated like other countries. "In other words, the concepts of least-developed and nonleast-developed countries be removed from Agoa," he said.

Kipling said the concepts of least-developed countries and nonleast-developed were "ill-conceived from the beginning" and were introduced to create a captive market for the South African textile industry.

However, not everyone advocates ending the distinction.

South African Textile Federation executive director Brian Brink said yesterday the introduction of the distinction between Agoa-eligible countries had nothing to do with the federation. "It was a decision which was taken in Washington. But I do not think anyone can morally argue that there is no distinction between the countries," he said.



“AGOA Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of South Africa’s bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.