Australia’s A$9 billion ($6.03 billion) textile and footwear industry has cautioned against the country rushing into a free trade agreement with Thailand.

The Footwear Manufacturers Association of Australia (FMAA) and the Council of Textile and Footwear Industries of Australia (TFIA) have both expressed doubt over whether Thailand can vouch for the origins of its products.

The groups questioned the integrity of Thailand’s borders stating it could be possible for Thai entrepreneurs to obtain cheaper goods from other countries, repackage them in Thailand and then export them to Australia duty free.

There is currently a 25% tariff on imports of apparel, which is scheduled to fall to 17.5% on January 1, 2005. The tariff on textiles and footwear is 15%, which is expected to be reduced to 10% at the beginning of 2005.

Clothing and footwear output slowed during May. Transport equipment, wood, wood products and furniture also declined.

The Australian Industry Group’s Performance of Manufacturing Index (PMI) dropped 3.1 points (-5.7%) in May to 51.7, seasonally adjusted, the lowest reading since July 2001.

New orders declined 4.6 points to 50.5 while company gross operating products rose 1.4% in the March quarter to 8.6%.

Share this story: