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Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.

 

Swaziland: Canadian Market to Save Some Jobs

Friday, October 17, 2014 > 11:54:19
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(Times of Swaziland)

The opening of the proposed Canadian textile and apparel market for Swaziland will reduce the number of jobs to be lost.

The Government of Canada is exploring avenues to establish an export market for the local textile industry. However, this will not be enough to avert the loss of jobs in the textile and apparel sector as many people might think will be the case.

Recently, the country suffered a setback after the United States of America President Barack Obama announced the suspension of Swaziland from being a beneficiary of Africa Growth Opportunity Act (AGOA). The textile and apparel industry, which employs about 20 000 people will be greatly affected by the suspension.

Shawn Barber, the High Commissioner of Canada to Swaziland, when presenting his letter of credence to His Majesty King Mswati III at Lozitha Royal Palace last Thursday said he would focus on the textile sector.

“Using our Canada Fund for local initiatives, we are working with the local textile associations to bring a Canadian expert to Swaziland in the next several months to provide advice and guidance on exporting Swazi textiles to the Canadian market,” he was quoted by this publication as saying.

With this announcement, one could think it would avert the looming job cuts in its entirety in the textile industry following the loss of AGOA. In as much as it is good news, the opening of the export market can only reduce the number of jobs that could be lost. This would be more so because the Canadian textile market is far different to AGOA.

AGOA was duty free while the Canadian textile market imposes tariffs ranging from 10 to12 per cent on all imported textiles or fabrics. This information is contained in the Canadian Apparel Federation website.

With the imposing of duties on imported apparel commodities, this will require local companies to pay money to have their goods shipped to the Canadian markets. This was not the case when exporting to the US markets under AGOA. The exports were duty free. This means, it was relatively cheap to export to the US. The Canadian market will not be as lucrative as compared to the US markets.

With these duties, textile companies, which were affected by the loss of AGOA, can reduce the number of jobs they were going to cut not that they would not cut them altogether. Simply put, the job losses could be minimal in the sector with the advent of the Canadian market.

Swaziland Textile Association’s member Jay Hall said in as much as it is good news to the textile and apparel industry players, it is too early to celebrate it. “The commissioner said they were exploring avenues to provide a market to the textile industry therefore it would be irresponsible to say we have already got the market,” said Hall.

According to Statistics Canada, bilateral merchandise trade reached US$3.3 million (E33 million) in 2010, with Canadian exports to Swaziland worth US$1.6 million (E16 million) and Canadian imports totalling US$1.7 million (E17 million). Canadian exports to Swaziland usually comprise of pharmaceutical products, machinery, cereals, cosmetics and perfumery. Canadian imports from Swaziland mainly consist of woven and knit apparel.


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