CAIRO, Nov 29: The Egyptian textile industry, one of the jewels of the country's economy, needs urgent reforms if it is to survive fierce global competition, exporters and officials said on Wednesday.

“We don't have much time, our industry needs urgent decisions,” Magdy Tolba, the head of Egypt's readymade garment export council, told AFP at a Cairo conference on the future of the textile sector.

As the number of textile-producing countries is fast being concentrated from around 60 a few years ago to a projected 10 to 15 by 2010, Egypt needs to secure its share of the $400-billion global industry.

Egypt's textile industry, one of the oldest in the world, counts some 1,500 manufacturers, employs 500,000 people directly and has an annual output estimated at $3.2 billion.

With readymade garment exports projected to top $1.3 billion in sales in 2006, a 30 per cent increase compared to 2005, indicators are on the up for Egypt.

Some sixty per cent of these exports are being absorbed by the US market on the back of the establishment in 2005 of the Qualified Industrial Zones, an agreement under which Egyptian goods containing at least 11.7 per cent of Israeli components can enter the US market customs free.

“Europe is phasing out most of its textile industry and Egypt is in a better position than any other country to benefit from this,” Chairman of Garment Exporters Association Kassem remarked.

The rising cost of labour is also forcing textile heavyweight Turkey to gradually migrate its industry to Egypt.

Egypt enjoys good trade ties with Western markets, a strategic geographical location and cheap labour. But the poor level of training and an obsolete upstream sector threaten the industry's long-term viability, experts said.

“The upstream sector, which is controlled by the public sector, is where the problems are and we need to import raw material to keep up with the growth in readymade garments,” Helmy Abouleish, who heads the industrial modernisation centre at the ministry of trade, said.

Egypt is known worldwide for the superior quality of its cotton and accounts for 50 per cent of upmarket long staple cotton production globally.

But it has to import an estimated 90 per cent of its total volume of yarn and fabrics to feed the manufacturing sector.

The skyrocketing growth of Asian giants China and India has left the Egyptian textile industry lagging behind and in need of a complete overhaul.

“For example, the advantage of proximity to our markets will mean nothing if we don't have a better frequency of boat shipments,” said Kassem, pointing out that India was currently shipping goods to western Europe faster than Egypt. —AFP