Sector Implodes Under FRCS Roadblocks
‘Unattractive to bring new clients, at the risk of losing existing ones’
Dialogue continues between manufacturers and relevant authorities to simplify processes for exports. The comment from Textile Clothing and
Footwear Council spokesperson Inbamalar Wanarajan followed the decision of a member who went public in an attack on the Government bureaucracy and red tape.
Earlier, Performance Flotation Development Fiji Limited managing director Mike Towler lashed out at “administrative obstacles” which hindered business expansion in the country.
Mr Towler labelled Fiji Revenue and Customs Service as a “joke” for standing in the way of national progress. SunBiz continues to await response from Fiji Revenue and Customs Service.
Ms Wanarajan – council’s first female president – acknowledged Mr Towler’s plight as he tried to create more export and employment opportunities. “Mr Towler has some concerns, and he is obviously expressing his frustrations with some red tape approach by authorities,” she said.
“There is a lot of frustration in the industry with the three per cent import duty on raw materials which was announced in the last Budget, and we’ve since tried to seek an audience with senior officials without any success.
“There is discussion regarding a duty drawback system which at this stage appears to be a complicated and impractical. “However, we hope to find some workable solutions.
“The imposition of three per cent duty is making it difficult to compete in export markets, and it certainly doesn’t sound attractive to bring new clients to Fiji, at the risk of losing existing clients.”
Many factories have lost orders because of the three per cent duty on raw materials, Ms Wanarajan said.
“We are strongly urging Government to reverse this unless they are prepared to see the garment industry shrink disappear,” she said.
“Mr Towler’s frustrations and loss of confidence in manufacturing in Fiji is understandable.”
BACKGROUND – EXPORT CERTIFICATE
Performance Flotation – the Southern Hemisphere’s largest manufacture of lifejackets was on the cusp of establishing a new market in Solomon Islands.
However, after the Nabua-based factory had manufactured life jackets for export, Fiji Revenue and Customs Service asked for proof of export certification.
Being in the export sector for more than three decades, Performance Flotation did not understand the bureaucracy involved this time in the export to Solomon Islands. The factory withdrew its export, and though the cost was marginal, the principle had to be set, Mr Towler said.
Mr Towler said the cost to comply with requirements outweighed the order of export. “It will run into many thousands of dollars in time and costs, that it makes the exercise irrelevant,” he said.
“I have advised the Solomon Island customer that the provision of this document with a FRCS stamp is impossible, and that I will refund them the cost of the Solomon Island duty, and that I will not be able to supply my Fiji made lifejackets to them in future for duty free access to Solomon Islands.
“FRCS is the biggest hinderance to developing new markets in the pacific for our exports.
“It’s a bloody cruel joke that one arm of the Fiji Govt (Investment Fiji) is spending taxpayers’ money on promotion of Fiji as a manufacturing hub for the Pacific, when another arm of the same Governmentt (FRCS) is running administrative opposition to exporters developing a new market for our manufactured products.”
Mr Towler said attendance at an upcoming discussion with Fiji Revenue and Customs, facilitated by Investment Fiji, was an exercise in futility.
“It is now my intention to bring this issue to the attention of the Fiji media because I do not know any other way that we will get anything done about this type of FRCS road blocks,” Mr Towler said.
“If the TCF EXCO deems my actions disruptive or not in accordance to the council’s best interests, then I will tender my resignation from the TCF Council of Fiji EXCO. “I can no longer remain silent about this DDB scheme & MSG / PICTA Export certificate charade.”