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Al-Ahram Weekly 5 - 11 August 1999 Issue No. 441 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 5 - 11 August 1999 Issue No. 441
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Profile Focus Interview Features Travel Living Sports Time Out Chronicles People Cartoons Letters Packin' it in
By Zeinab Abul-GheitEgyptian manufacturers of cartons and other packaging materials are experiencing high production costs due to excessive customs duties on raw materials, rising transportation costs and sales taxes. The result is that locally produced items often cannot compete successfully in the world market. In addition, the high price of imported machines requires a huge investment.
The major obstacle impeding progress in the packaging industry is the high customs duties imposed on essential imported raw materials, said Rashad Tawfik, deputy chairman of the printing, binding and packaging chamber. Producers pay up to about 40 per cent duty on the price of these materials.
The industry also is up against strong competition from neighbouring countries including Saudi Arabia, Iraq, Cyprus, Malta and Israel which sell their products in Egyptian and other foreign markets at very low prices, Tawfik said. Unlike Egypt, producers in these countries do not pay customs duties on raw materials.
Another problem is that when the Egyptian importer presents customs officials with the invoice for his goods, showing the actual price he paid, they claim that the price is wrong, and impose higher duties and a fine, Tawfik added.
In September the Fourth International Conference for the Development of Packaging and Wrapping will be held in Cairo. It will address the difficult problems hampering progress in the industry. The conference is sponsored by the Egyptian Export Promotion Centre (EEPC) and companies working in this industry. "It is important to improve the packaging sector to make Egyptian exports appeal to consumers in foreign markets," EEPC Chairman Hamdi Salem said.
Nashaat Sadek, head of the board of directors of the Engplast Factory for Plastic Containers, said that by the end of the 1980s, the private sector had started to import inexpensive machines from Taiwan. But Egypt still was not able to compete in foreign markets. In the 1990s, the industry began to improve thanks to a few expensive machines imported from Europe.
Another stumbling block facing the industry is that customs officials insist on opening 10 per cent of containers exported from Egypt, saying this is necessary to make sure the product complies with legal specifications. This causes exporters great losses because the containers are damaged, according to industry spokesmen.
According to Atiya Mahmoud Atiya, purchasing manager of Haidylena Medical Company, "It will be a long time before containers produced in Egypt will be able to compete in foreign markets." And since local containers are not up to world standards, Egyptian companies cannot dispense with imported containers, he added.
