China textile restrictions over?

Cape Town - South Africa is unlikely to extend restrictions on Chinese textile imports beyond December 2008, when they are due to expire, a senior government official said on Wednesday.

"We don't have any applications from anyone (to extend the quotas)... and so my expectation is that if we don't get any, they will expire," Tshediso Matona, director general in the department of trade and industry, told reporters.

South Africa introduced quotas to restrict Chinese textile and clothing imports in January 2007 after unions complained the cheaper products were hurting local manufacturers and causing job losses.

Retailers such as Woolworths and Truworths complained at the time that the quotas inflated their costs and the central bank warned they would add to inflationary pressures.

Matona said a report was being finalised that would measure the impact of the restrictions, although anecdotal evidence showed a "marked reduction" in imports from China. He said the government had so far received no calls for extending quotas.

The Southern African Clothing and Textile Workers Union (Sactwu) initially lodged a complaint calling for a curb on Chinese clothing imports.

It said cheap Chinese imports caused thousands of job losses in one of South Africa's biggest manufacturing sectors, which was struggling to improve competitiveness in the face of declining exports.

Union officials were not immediately available for comment on Wednesday.

Lifting the quotas could bring relief to South Africa's clothing retailers, allowing them to buy cheaper products in China to help offset a sharp slide in consumer spending.

- Reuters