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Ukay-ukay

October 9, 2010

Tomorrow is 10-10-10. Whatever that implies to many Filipinos, who are more and more inclined towards the intricacies of Feng Shui, here’s wishing everyone ø more prosperous year ahead.

The pronouncement of a Cabinet Secretary that he is inclined towards legalizing the ukay-ukay has met with a vociferous reaction from the Federation of Philippine Industries, with a lot of reasons, no doubt. Federation president Jesus Arranza has been very vocal about it—“it is unconstitutional, to say the least and it threatens legitimate garments manufacturers.”

Jess says there is a specific law in our Philippine Constitution that expressly prohibits “the introduction of used clothing anywhere in the Philippines”. Some parties are actually skirting the law by allowing these used garments to pass through special economic zones, to which Jess poses a question, “Are these special economic zones not located inside the Philippines?” Jess even went as far as naming reportedly one of the biggest suppliers of ukay-ukay clothes entering through Subic — a company called Inter-link, and he unabashedly proclaimed this on national television.

The Federation also takes exception to the claim of some quarters questioning the timing of their protest — why protest the proliferation of the ukay-ukay only now when the government seems poised to declare them legal? The Federation says there is no truth to this at all. They have lodged official protests starting several years back with no less than Congress and they have been fighting the obviously illegal entry of these used garments into the country for years. Nothing has come out of their collective action and they actually stopped following up on their protests in 2005, apparently tired and frustrated over the inaction of our lawmakers. Meanwhile, our textile manufacturers, in fact the whole garments industry of the Philippines has virtually gone down the drain, one by one dying by the roadside.

The Federation president claims that the once-flourishing garments industry is no more. We used to have several big textile factories employing hundreds of thousands of workers. Now, only about 30 percent of the manufacturers remain standing, floundering in deep uncertain waters. The spinning sector (thread manufacturers used for textiles) is in the same predicament. Where before the country had some 1,500 spindles, each spindle employing 35 workers 24/7, we now have only a few stragglers left. A big textile factory in Parañaque recently closed shop, dislocating 3,000 workers. All these were supplied by Mr. Jess Arranza to bring to light the predicament our textile manufacturers and allied industries face from the proliferation of the ukay-ukay.

And to think, Jess says, that P-Noy took pains in lobbying for our local textile makers exporting to the United States for tariff-free entry into the lucrative US market.

Come to think of it, how can you legalize the ukay-ukay? What can possibly be the basis for the taxation of these garments that come in bulk, in boxes of assorted types and makes? Jess points out that at least for used automobiles, we have the so-called blue book that serves as a guide for Customs personnel to slap the appropriate taxes. But for ukay-ukay? Do we tax them by the Kilo? That is dangerous because pretty soon, these ukay-ukay bundles will suddenly have brand new high-end clothing mixed surreptitiously with the old cheap clothes and passed on as used garments. As it is right now, Jess Arranza says that these used garments enter the country under-declared or under-valued or brazenly smuggled in, because how else can they afford to sell them dirt-cheap?

What used to be petty business is now a multi-million- peso enterprise and one can find ukay-ukay stores in every corner, in every city or municipality. –Ray Butch Gamboa (The Philippine Star)

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