China takes advantage of Turkish "export system"
The quasi-legal Russian-Turkish baggage trade has clocked up some astounding figures. With exports now worth billions of dollars, the baggage (or luggage) trade is a misnomer.
For 2002, official (documented) leather garment exports will top $500 million. The take-out, seamless border trade in leather garments, however, will amount to $1.5 billion, giving this sector a $2 billion export value. Add in leather accessories, shoes and miscellaneous items and the figure is closer to $3 billion for the leather sector as a whole.
A prominent leather official estimated the loss to the Turkish Treasury at half of this, some $1.5 billion. Other taxes levied on production also dissolve in cash transactions.
It has been reported that Chinese makers of leather garments have now come to Istanbul's leather garment district of Zeytinburnu and are opening manufacturing units to take advantage of the no-frills trade. Turkish firms who went out of business in 1998 after the devaluation of the Russian rouble are now opening their doors again.
Everyone wants to tap as much business as they can, not just for the double-face season, but before law makers and, eventually, the WTO close their doors.
