The factories in Al-Mahalla Al-Kobra in the Delta that manufacture ready-made clothes are threatened with closure, because of the continued smuggling into Egypt of huge quantities of garments from countries such as China, Turkey, Korea and Indonesia. These clothes are sold for less than 50 per cent of their locally manufactured equivalents, which obviously means there is a great demand for them here. As a result, domestic production is seriously suffering, with the local industry making huge losses. Mohamed Nabrawi, who owns one of the major companies operating in the ready-made clothes and garments sector in Al-Mahalla, told Al-Messa newspaper that this sector is at risk due to the clothes being illegally smuggled into the country in the past two years. These clothes, which entre Egypt in large containers, are flooding the local market. They are sold on pavements and from vehicles in the street at cheap prices, tempting many people to buy these low-priced clothes in the wake of a recession and harsh economic conditions which have hammered the low-income classes since the eruption of the revolution. Nabrawi pointed out that garment factories are suffering from the high prices of raw materials, manufacturing, employment, taxes (including sales tax), insurance, electricity and industrial security. All these factors mean that they have had to increase the prices of their products and slash their profits, while the contraband products entre the country without anyone paying any customs dues. Some economic experts believe that the main problem facing the future of textiles and ready-made clothes in Egypt is uncertainty over the subsidising of exports, namely textiles. This state of affairs is due to the instability of employment, an inadequate supply of raw materials and the irregularity of port operations. Hossam Abdel-Gawad, the owner of a large garment factory in Al-Mahalla, says that factories like his are on the verge of bankruptcy and closure, because of the deluge of smuggled goods and foreign products in the market. Consequently, most big companies and factories operating in the field of ready-made clothes manufacturing, such as Mahalla Weaving Co., are incurring huge losses. Engineer Mahmoud Shami, Deputy Chairman of the Textiles Chamber, blames the free zones scattered across the country for most of the clothes being smuggled into the domestic markets. He says that these zones turn a blind eye to covenants and agreements of the free zones, that depend on re-manufacturing foreign raw materials to certain specifications, before their being re-exported in an official, legal way. But, in the past two years, these zones have not adhered to these conventions and, instead of re-manufacturing these materials for re-export in a legal manner, they end up in the local markets, because of the security vacuum, chaos and absence of control. Mohie Zaghloul, the owner of a big clothes shop, says that the consumer is not concerned about the raw materials or whether the brands are well known or not; he is only interested in cheap prices and good quality. “The consumer can find good quality and cheap prices in Chinese, Korean and Turkish, Syrian and Malaysian clothes. That's why Egyptian citizens buy these products instead of ours," he explains.
