Shoe firms push for expanded raw material rebates

Source: Shoe firms push for expanded raw material rebates – herald

Nqobile Bhebhe nqobile.bhebhe@chronicle.co.zw

SHOE manufacturers are lobbying the Government for the inclusion of additional raw materials under the Shoe Manufacturers Rebate Facility to enhance the sector’s competitiveness and reduce production costs.

The Competition and Tariff Commission said the shoemakers have applied for additional raw materials in terms of Statutory Instrument 61 of 2017, which provides for the reduction of customs duty on approved raw materials used in the production of footwear.

CTC said the proposed review seeks to support local industry by lowering the cost of imported raw materials and improving the viability of domestic manufacturers amid growing competition from imports.

“The Competition and Tariff Commission hereby notifies stakeholders that it has received an application from shoe manufacturers seeking assistance through the inclusion of additional raw materials under the Shoe Manufacturers Rebate Facility.”

“The Shoe Manufacturers Rebate Facility is provided for under the Customs and Excise (Shoe Manufacturers) Rebate Regulations, 2017 (Statutory Instrument 61 of 2017), which grant qualifying shoe manufacturers a rebate on imported duty on specified imported raw materials used in the production of footwear,” CTC said.

The commission noted that the facility was introduced to strengthen local production capacity by easing the cost burden on manufacturers.

“The primary objective of the facility is to reduce production costs for local manufacturers, thereby enhancing their competitiveness against imported finished footwear and supporting industrial development,” CTC said.

Among the additional raw materials proposed for inclusion under the rebate facility are sewing thread, buff tape, gum paper, water-based cement adhesives, chlorine powder, woven labels, embossing foil, stitching wax, resin fillers, EVA micro HD, shoe laces, reducers, hardeners and stitched uppers with stiffeners. The proposed duty rebates range from five percent to 30 percent, depending on the raw material category.

CTC said it is empowered in terms of Section 34C (1)(c) of the Competition Act [Chapter 14:28] to undertake investigations into applications for assistance or protection to local industry.

The proposed inclusion of more raw materials under the rebate facility could provide much-needed relief to Zimbabwe’s footwear manufacturers.