The President of the Textile Clothing Footwear Council says Fiji Trades Union Congress National Secretary, Felix Anthony’s anticipation of the national minimum wage of $6 to $7 per hour will be disastrous to the textile clothing and footwear industry in Fiji.
Inbamalar Wanarajan says imposed wage increases without any contribution towards productivity is counter-productive to any industry.
She says the textile clothing and footwear industry is already suffering from recently imposed local cost increases.
Wanarajan says passing on these new additional costs to their export customers will destroy Fiji’s industry to compete internationally.
She says this proposed 50 percent minimum wage increase challenges the industry with other recently imposed increased costs including a recent 48 percent national minimum wage increase, increased FNPF employer contribution, a new 3 percent tariff on raw materials and increase of company tax by 5 percent.
She further says factories will have but one option which is to focus on exit strategy. Wanarajan says the industry employs over 7,000 workers of which 80 percent are women, and most do not hold professional qualifications.
She says the textile clothing footwear industry needs to be consulted well before taking any steps towards wages increases.
The council says increasing manufacturing in Fiji is a national strategic goal to diversify the economic base but the proposal to increase the national minimum wage rate by another 50 percent will soon eliminate manufacturing from Fiji altogether.
She adds at many instances the industry has explained why the declining employment from 20,000, 20 years ago to now only 7,000 was due to similar imposed cost increases without any productivity offsetting making Fiji less competitive.
The TCF Council President further says this proposal now under consideration will certainly be another nail in the coffin.
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