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CAIRO – 19 April 2020: Chairman of the Readymade Garments Export Council of Egypt Magdy Tolba told Egypt Today that the majority of 350-400 garment factories in Egypt will be negatively affected by international brands decision to halt manufacturing worldwide.
Tolba stated that Levi's, VF, Decathlon, United Colors of Benetton, and Inditex brands like Zara, Pull&Bear, Massimo Dutti, Bershka, and Stradivarius are among the top global clothing companies dealing with Egyptian factories. He revealed that the production has been almost suspended for a month.
The council's chairman pointed out that since such factories are labor-intensive and are required to not lay off workers, the government's assistance must come fast for them to overcome the crisis whose end time cannot be predictable.
Tolba speculated that Egypt's exports of garments would decline in 2020 compared to the previous year as they recorded $1.7 billion because manufacturing for international brands constitutes a large portion of the production.
The businessman said that garment manufacturers are continuously consulting with Minister of Industry and Trade Nevine Gamea, and that is responding positively. He demanded that the emergency measures declared by President Abdel Fatah al-Sisi, the Cabinet, and the Central Bank of Egypt (CBE) go into effect fast.
CBE is offering LE100 billion worth of soft loans with 5 percent interest rate for the manufacturing sector.
The measures announced to support companies and businesses to alleviate the crisis include real estate tax exemption for 3 months, paying the fees of tax statement reports over 3 installments until June 30, and removing holds on bank accounts of default investors if they pay 10 perent of the debt.