The Lebanese government has moved to ban the sale of certain Turkish products, including textile imports worth US$123.3m a year, to protect local production. However, Lebanon’s textile manufacturing sector is small, raising questions as to why Turkish textile imports should be banned.
Lebanon’s Council of Ministers approved the request of the country’s ministry of economy and trade to ban certain Turkish products following lobbying by the Association of Lebanese Industrialists (ALI) over ‘unfair competition’. Since the start of the Syrian conflict in 2011, Lebanon has been inundated with Turkish goods after the Syrian border was closed and a direct cargo ferry was established between Tripoli in northern Lebanon and Mersin, in southern Turkey. The depreciation of the Turkish lira since 2015, from TRY2.3 to the US$ to TRY4.6 in 2018, has also bolstered imports.
According to Nassib Ghobril, head of research and analysis at Lebanon’s Byblos Bank, the ALI was calling for such measures before the depreciation. “The ban on Turkish imports comes from the approach that we export almost nothing to Turkey, and it’s a major import source, so ban imports that could be produced locally,” he says.
Ghobril adds that due to an economic slowdown in Lebanon (GDP growth is projected to be 2.2% this year and 2% in 2019), consumers had been shifting purchasing habits from imported clothing brands to locally produced items. However, there are no reliable statistics or data on the size of the Lebanese clothing and textile sector.
According to Naji Mouzannar, a manager at Mouzannar Brothers Corporation for spinning, weaving and printing, based in Fayadieh near Beirut, and a member of ALI, Lebanese textile production has decreased over the past decade to just a handful of manufacturers today. Where Lebanon remains strong is in couture and haute couture for high-end fashion, with designers such as Elie Saab and Georges Hobeika, with some 350 workshops employing between two and 10 workers, according to Mouzannar.
However, the ban has puzzled Ahmad Rakha, managing director of Beirut’s Rakha Textiles. “We plan to lobby against this ridiculous decision as we don’t have a fabric or textile industry anymore,” he says. “We’ll have to go back to sourcing from China.”
According to Rakha, for more industrially advanced textiles, retailers have shifted over the past five years from China to Turkey due to better prices and higher quality. “Some retailers are shocked by the ban, as they were sourcing 100% from Turkey, and are now looking for ways around it,” he says. “Because of the decision, we are going to China in the next few months, and we’ll buy more from Europe.”
He adds that the move will drive up prices in an already depressed local textiles market, which has contracted by 30% since 2011. “For Spanish textiles we pay US$12 per metre; for Turkish; US$6; and Chinese US$8 – and not as high quality. It is also harder to source polycotton and cotton textiles from China.” Retailers were also able to source smaller quantities from Turkey, while Chinese producers required larger orders, he adds.
Domestic production has reduced in Lebanon due to high labour and production costs. Rakha gives the example of textile dyeing costing around US$4/kg in Lebanon, whereas in Turkey it is US$0.50.
Source: www.wtin.com