CAPE TOWN (Reuters) - South Africa and China have agreed in principle a pact to regulate the import of cheap Chinese clothing and textiles, but were still working to finalise a deal, the trade minister said on Monday.
South Africa's powerful trade federation COSATU has demanded the government take action to stem the flow of cheap Chinese imports, which analysts say threaten the industry in South Africa.
"There has been political commitment on the side of both governments to come up with an agreement," Trade Minister Mandisi Mpahlwa told reporters in Cape Town.
He said a draft agreement was on the table but that some details had to be worked through.
South African labour unions have threatened to boycott clothing retailers they accuse of stocking cheap Chinese clothes over locally-made goods.
They say the imports have cost tens of thousands of jobs, especially in Cape Town where the sector is one of the region's most important employers.
An estimated 150,000 jobs have been lost in South Africa's textile industry over the past 10 years. Clothing imports from China are estimated to have surged 110 percent since 2003.
On Friday, President Thabo Mbeki said in an annual state of the nation speech that the two countries had reached a deal to regulate the import of cheap Chinese clothes and textiles.
"We have already reached agreement with ... China to protect our clothing and textile sector," he told parliament.
But Mpahlwa said negotiators had established the need for an agreement and both sides would now consult with their various roleplayers, including labour and business.
"We have reached agreement to come to an agreement to manage some of the pressures facings the clothing and textile (sector)," he said.
South African trade officials said on Friday they had been in talks with China on a regulatory arrangement involving import quotas as part of a strategy of accelerating South Africa's economic growth to at least 6 percent per year from the current 4 percent.
Mpahlwa also said the government would push ahead on talks with India to secure a free trade agreement but that a similar pact with China "was not on the cards" at present.
