For_Immediate_Release:
Hampered by domestic political pressures and a lack of international confidence, Syria’s economy is expected to grow by only 1.5% during 2006-07. With progress so slow, the government has targeted the textile and apparel industry—which accounts for 30% of Syria’s industrial employment—as a vehicle for growth and enterprise. Through the General Organisation for Textile Industry (Goti), the administrative centre of the public textiles sector, the government has invested heavily in new production facilities in recent years, while maintaining a protectionist approach to imported goods. There is a ban on imports of raw cotton, cotton yarns and fabrics made mostly or wholly from cotton—except in special cases. Imports of carpets are restricted by a 75% tariff.
Government investment has fostered some progress. Between 1990 and 2004 cotton yarn output rose from 39,000 tons to 107,610 tons. Also, ready-made garment production increased from 35.1 mn pieces in 2000 to 54.7 mn three years later. However, government intervention has dissuaded overseas investors from entering the marketplace, and, by placing heavy taxes on Syria’s vast private textile sector, the state has slowed technological development. It is estimated that 4,000 of Syria’s 15,000 looms are still powered by shuttles. Furthermore, the government’s protectionist policy has left little incentive for potential internationalisation. Exports of Syrian carpets, yarns and threads, and home textiles to EU25 countries all declined significantly between 2003 and 2004. However, in November 2005 the government agreed to allow garments to be imported from anywhere in the world, albeit with a 47.5% tariff. Although this move could expose the Syrian textile industry to competition from China and elsewhere, it might also encourage foreign investment. With a domestic cotton supply, a strong textile tradition and low labour costs, Syria is well placed to enhance its textile and apparel industry under a freer trade system.
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