Relief and concern over Govt’s textile changes

Press, 20 February 1980, Page 2

Relief and concern over Govt’s textile changes

The Government’s plans on the textile industry' were greeted with a mixture of relief and concern by industry leaders yesterday. The president of the Textile and Garment Manufacturers’ Federation (Mr J. Penn’ev), said in Christchurch that the knitting industry would benefit from being able to get synthetic yarns from overseas at world prices. The Government announced on Monday that tariffs on nylons and polyester yarns would be reduced to the lowest rates possible and would be exempt from import licencing. The hardest hit by that decision will be Fibremakers

New Zealand Ltd, which has an extrusion plant at Wiri for nylon and polyester. Mr Penney said that woollen mills would on the one hand get $5 million for rationalisation and restructuring, but on the other would face strong competition in fabrics through the adoption of the Industries Development Commission recommendation that fabrics be classified according to the predominant content.

A fabric with 51 per cent synthetic content could come in to New Zealand free of import licence and compete against New Zealand - made fabrics with a high wool content. However, the Government had not yet announced,

its tariffs on imported fabrics.

Mr Penney welcomed the decision to'exempt machinery from the 10 per cent sales tax.

Household textiles such as towels, sheets, and pillowcases made in New Zealand were not to be supported under the Government’s plan, and some producers would face stiff competition from imported lines, said Mr Penney.

the industry ‘ employed several hundred people, many of whom were in small regional areas and whose jobs would be in jeopardy. The managing director of Mosgiel, Ltd, of Dunedin (Mr J. S. Lee) said that the Ash-

burton mill formerly owned by Alford Forest Mills, then by Lane Walker Rudkin before being bought by Mosgiel would continue making woollen and - worsted yams.

Mosgiel would develop its exports of furnishing and upholstery fabrics with the help of the newly-announced bounty, with the aim of building up exports big enough to contribute efficiencies which would alleviate the loss of the bounties after June, 1984. He said that the bounty system would be financed not from the Treasury but mainly from the import licence tendering system being developed by the Government.