New Turkish regulations are good for exporters but not good for spinning companies

by:JIYALI     2021-07-31
The Turkish Deputy Minister in charge of foreign trade announced on Thursday the cancellation of a decision instructing exporters of bath towels and bathrobes to use 50% of domestic yarn in their production.   Due to competition from China, spinning companies are in a difficult period. The purpose of this policy was to protect domestic spinning companies three years ago.   Istanbul Textile and Raw Material Exporters Association President İsmail Gülle said that Turkey’s yarn production capacity is surplus. I don't know how these companies survive in such an environment. This decision is unbelievable. This decision will not benefit exporters, but it will hit production companies.   In 2004, the internal processing system stipulated that imports should be controlled through export registration. According to requirements, the Deputy Prime Minister in charge of foreign trade introduced the obligation to use 50% domestic yarn. For three years, the exporters of bath towels and bathrobes in the Aegean Province have been working hard to call for the cancellation of this decision, which they say has created an unfair playing field.   In 2006, Turkey imported 102,000 tons of yarn. At the end of this year, after the decision to abolish the use of 50% of domestically produced yarn, imports are expected to reach 160,000 tons.   This decision is only conducive to exports to the United States. There are no tariffs on U.S. exports. But the export of bath towels and bathrobes to the United States is only 500 million U.S. dollars. Therefore, this decision only brought an increase of US$600,000 in revenue for bath towel-yukata companies. On average, each company received only $5,000 in benefits.   Textile and Apparel Exporters Union President Raşit Günta said that the protection measures are not commensurate with the EU’s full access and free market economic environment.
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