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| Sunday, 9 June 2002 |
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Footwear industry calls for changes in duty structure The local footwear industry can once again emerge as a winner, catering to the growing customer demand if certain changes are carried out on the duty structure, Ranjith Hettiarachchy, Deputy Chairman of the Ceylon National Chamber of Industries and Chairman of its Footwear and Leather Sector said in a statement. The footwear industry, which was a foreign exchange earner and prosperous local industry catering to the demand of local customers, has gradually become a sick industry. A few major producers have already closed their operations while some are struggling to retain their labour force. According to Hettiarachchy, although consumers have come to anticipate frequent changes in design and styles, local industrialists were not in a position to carry out frequent design changes to satisfy demanding customers due to financial constraints. The tariff structure also enabled footwear importers to use Sri Lanka as a dumping ground and sell these stocks at very low prices. Although the attention of the authorities was drawn to this matter by footwear industrialists, nothing was done to arrest this situation and safeguard employees and industrialists, he said. "Though the footwear market has grown tremendously in the recent past with the growth in living standards, this market has already been captured by the traders. The contribution to the economy from these traders is negligible compared to producers. "Imports have increased 100 per cent against last year's figures. The authorities should be concerned about this matter when we are struggling to improve our foreign exchange situation. Saving foreign exchange is equally important as earning foreign exchange," he said in the statement. Although footwear industrialists have raised these issues on many occasions, they have not seen any positive action. About 25,000 people are directly employed in this sector. The industry has requested the authorities to follow India's example and introduce a minimum invoice value for imports. They are also lobbying for the imports of shoe components to be made duty free while maintaining the present duty structure for completed footwear i.e. 25 per cent on CIF value and duty surcharge; reduce the duty on imported leather until the Bata-atha tannery project is commissioned; and to limit the number of pairs imported on personal baggage. He said: "We are confident of catering to the increasing customer demand on new designs and safeguarding employees, while saving foreign exchange, if the above changes are implemented on a priority basis. "This Government has realised that certain changes need to be done on a priority basis to re-activate this industry. The Ministry of Industries has already accepted these proposals in principal. However, manufacturers are worried due to the delay in implementation." |
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