Revised textile export incentive scheme misses April deadline

But dti agrees to backdate benefits LEONARD NEILL THE REVISED export incentive scheme for the textile industry drawn up by the Department of Trade and Industry (dti) has missed its April 1 implementation date. To be known as the interim clothing and textile industry development programme, it will replace the current duty credit certificate scheme (DCCS) which expired on March 31. The new scheme will remain in force until March 31, 2007. But while the industry is now left in a state of limbo, a glimmer of hope has emerged from the dti. Textile Federation executive director Brian Brink has been advised that when the new scheme is eventually introduced, all benefit applications within the textile industry can be backdated to April 1. “There is naturally concern in the industry as things are somewhat uncertain,” says Brink. “But it does appear that even if there is to be a delay in the implementation of the scheme, benefits can be backdated. If what we have been told is correct, then no one will be adversely affected. “The question being asked is whether the exporter takes the risk and costs it into the pricing.” The industry has viewed the duty credit certificate scheme with mixed feelings, says Ebrahim Patel, secretary general of the Southern African Clothing and Textile Workers Union. “While it helped to promote exports, which is a good thing, it also rewarded successful exporters by giving them a certificate to increase the level of imports into this country. They could even import finished garments. “This had the effect of constantly eroding the domestic market as a base. Another negative effect is that a duty certificate system also opens the door for fraud. It is just one more means by which some importers could get involved in widespread fraudulent misrepresentation to the detriment of jobs. “The system which is now phased out is therefore not of a sustainable nature. We have called for a system with an incentive scheme strictly based on promoting exports.”