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24.03.2009 Business & Finance

Smuggling of textiles causes drastic decline of employment

By GNA

The deluge of smuggled textiles into the country has caused drastic decline in employment within the sector from over 25,000 in 1975 to about 4,000 at present.

And the smuggling of textiles was not only affecting employment but also leading to loss of huge tax revenue, quality and the cotton industry, Ms Hannah Tetteh, Minister of Trade and Industry, said on Tuesday.

Touring Printex factory on the Spintex Road, the Minister said the smuggling of these shoddy and cheap fabrics had also reduced the number of textile factories from 24 to only four.

Printex Limited is a privately-owned Ghanaian company that manufactures fabrics.

She noted that the problem was so enormous that the industry needed much support and commitment from government to help address it.

Production of textiles has also reduced from 130 million metres to merely 30 million metres within the same period.

“It is not that Ghanaians' appetite for our own fabrics has disappeared or there is no market for them but there seems to be cheaper textiles imported into the country mainly from China by unknown importers who evade taxes and duties to the detriment of government.”

Ms Tetteh attributed the situation to lapses in the laws and called on the Customs, Excise and Preventive Service, Police and Ghana Immigration Service to enforce the implementation of the laws and close all unapproved routes.

She said the Ministry together with stakeholders would embark on a public awareness campaign on how much it costs government and the entire nation so as to deal smuggling.

“Cheap is cheap but cheap things turn out to be expensive and there is the need to educate them to know the difference.”

The Minister said the Ministry would help the textile industry create the foundation for a vibrant industry, revive other collapsed ones and make sure that the correct import duties and other taxes were paid.

“We need to protect Ghanaian jobs and improve the livelihoods of the people,” she said.

Ms Tetteh, who spoke passionately about stealing of Ghanaian designs by foreigners without any penalty, also called for the need to help protect the intellectual property and Ghanaian ingenuity.

Mr Millad Millet, Managing Director of Printex, who led the Minister and her entourage round the factory, said Printex Limited was currently operating at 30 per cent capacity and could do better if the enabling environment, import policies and utilities were more favourable.

Printex, he said, believed in establishing organizational values, nurturing individual responsibility and relating decisions to stakeholder interest.

He said over 70 per cent of fabrics sold on the Ghanaian market was imported illegally avoiding taxes and duties and called for intense remedial measures before it slid into an irreversible situation.

The Minister was also taken round Aquafresh, a sister organization that produces water and fruit drinks like Kalypo, Fruity, Frutelli and Juicee fruit drinks.

GNA

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