Textile industry suffocates
May 19, 2009
UNCONTROLLED importation of cheap fabrics and garments and high production costs are threatening the local textile industry. This, sector players said, would also undermine cotton production promoted by the Government.
By Ibrahim Kasita
UNCONTROLLED importation of cheap fabrics and garments and high production costs are threatening the local textile industry. This, sector players said, would also undermine cotton production promoted by the Government.
“Without controls, it is impossible for local manufacturers to compete with cheap imported textiles,†Yuichi Kashiwada, the Uganda Textiles Manufacturers Association (UTMA) chairman, observed. “The Government must protect local industrialists because we cannot afford to lose any more jobs,†he added in a phone interview from Japan.
He explained that the growth of a strong and competitive local textile industry depended on putting checks on importation of used clothes and cheap garments, which are dumped into the country.
The High cost of production has resulted in prices of dumped textiles becoming lower compared to the locally produced goods. “We are paying a lot of water, electricity and fuel bills, yet they are the major components for running the industry. Transport costs have soared, but the demand for our products is low,†Kashiwada explained.
“Millions of Ugandans depend on us through our value-chain. “People will lose jobs if we continue to import inferior textiles as textile industries close.â€
Across the value-chain, from cotton growing to garment production, the sector supports the livelihood of 2.5 million people, representing close to 10% of Uganda’s population.
Most factories like MULCO, ATM, Lira Spinning Mill and Rayon Textiles have been converted into warehouses because they could not compete with the cheap textiles from Asia, especially China.
As Uganda and other sub-Sahara African countries bemoan the high cost of production rendering themless competitive, China has a sophisticated supply chain, integrated factories and good infrastructure.
Furthermore, China's "friendship" with Uganda and African countries has led to an influx of its citizens who now run everything from grocery stores and building materials shops to restaurants and corner stores in even remote towns of the continent.
In the last one year, China sunk over $141.5m into various sectors in Uganda and $17.5m debt write-off. However in 2008, Uganda exported to China only $20m while Uganda imported Chinese goods worth $290m a huge trade imbalance.
This asserts that China imports mainly raw materials, with hardly any added value for industrial growth in the African countries. In 2004, China exported goods to Africa worth a total of $13.82 billion, against imports from Africa of $15.65 billion, but these figures mask a fundamental imbalance
African countries have for decades faced a dilemma of how to deal with China on trade issues because of Beijing's solidarity with Africa in its fight against colonialism in the 1950s and '60s.
UNCONTROLLED importation of cheap fabrics and garments and high production costs are threatening the local textile industry. This, sector players said, would also undermine cotton production promoted by the Government.
“Without controls, it is impossible for local manufacturers to compete with cheap imported textiles,†Yuichi Kashiwada, the Uganda Textiles Manufacturers Association (UTMA) chairman, observed. “The Government must protect local industrialists because we cannot afford to lose any more jobs,†he added in a phone interview from Japan.
He explained that the growth of a strong and competitive local textile industry depended on putting checks on importation of used clothes and cheap garments, which are dumped into the country.
The High cost of production has resulted in prices of dumped textiles becoming lower compared to the locally produced goods. “We are paying a lot of water, electricity and fuel bills, yet they are the major components for running the industry. Transport costs have soared, but the demand for our products is low,†Kashiwada explained.
“Millions of Ugandans depend on us through our value-chain. “People will lose jobs if we continue to import inferior textiles as textile industries close.â€
Across the value-chain, from cotton growing to garment production, the sector supports the livelihood of 2.5 million people, representing close to 10% of Uganda’s population.
Most factories like MULCO, ATM, Lira Spinning Mill and Rayon Textiles have been converted into warehouses because they could not compete with the cheap textiles from Asia, especially China.
As Uganda and other sub-Sahara African countries bemoan the high cost of production rendering themless competitive, China has a sophisticated supply chain, integrated factories and good infrastructure.
Furthermore, China's "friendship" with Uganda and African countries has led to an influx of its citizens who now run everything from grocery stores and building materials shops to restaurants and corner stores in even remote towns of the continent.
In the last one year, China sunk over $141.5m into various sectors in Uganda and $17.5m debt write-off. However in 2008, Uganda exported to China only $20m while Uganda imported Chinese goods worth $290m a huge trade imbalance.
This asserts that China imports mainly raw materials, with hardly any added value for industrial growth in the African countries. In 2004, China exported goods to Africa worth a total of $13.82 billion, against imports from Africa of $15.65 billion, but these figures mask a fundamental imbalance
African countries have for decades faced a dilemma of how to deal with China on trade issues because of Beijing's solidarity with Africa in its fight against colonialism in the 1950s and '60s.