Israel’s traditional textile industry is “very hurt” under the impact of online shopping
The once bustling textile and garment district in southern Tel Aviv, Israel, has now become “deserted and deserted.” Many shops along the street have closed down, with “For Rent” signs hanging everywhere, and many are in the process of withdrawing their stores to load goods. Israel’s traditional textile and retail industries are experiencing an unprecedented impact, and shop owners say this is all “caused” by online shopping.
In the 1970s, the textile industry was a relatively large industry in Israel. But now, the scale of the textile industry continues to shrink, with only about 10,000 employees in the industry. The textile industry and the retail industry have to compete with the growing cross-border e-commerce. Israeli experts believe that in the face of reality, relevant departments should support the transformation of traditional industry practitioners.
In recent years, in order to reduce the living burden of office workers, the Israeli government has taken a series of measures. One of them is to exempt goods purchased from abroad from value not exceeding US$75 from value-added tax. This policy has effectively stimulated the Israeli people. desire for overseas online shopping.
Data from the Israel Postal Company show that the number of parcels delivered in the country reached 60 million in 2017, most of which came from abroad. In the coming years, this number is expected to increase to 100 million pieces per year. For Israel, which has a population of just over 8 million, this growth trend cannot be underestimated.
Uriel Linn, chairman of the Federation of Israeli Chambers of Commerce, said in an interview that in order to increase imports and promote competition, Israel gives tax incentives to imported goods. Consumers who buy goods directly from abroad do not need to pay value-added tax, but they buy them locally. must be paid. He believes that this policy has not only impacted large fashion chain stores, but also many small retailers are facing challenges.
Danny Elhara runs a small clothing factory and a clothing store in Israel. “It’s unfair, I don’t get any subsidy,” he said.
Data from the Israel Central Bureau of Statistics show that Israel’s private consumption expenditure accounted for 55% of the country’s gross domestic product (GDP) in 2017. Lynn said that although private consumption is an important engine for Israel’s economic growth, it is a “crazy” thing to encourage cross-border online shopping just to promote competition. Israel’s economy poses ‘real danger’.
But according to Gilad Brand, a researcher at the Taub Center for Social Policy Research in Israel, this is a reality that people need to accept. Brand said that the Israeli economy is shifting from traditional manufacturing, including the textile industry, to more advanced industries that can provide better employment opportunities. Relevant policy departments need to invest in the education and training of low-income people from the textile industry and retail industry so that they can find higher-paying jobs in other industries.
Although some fashion chain stores in Israel have filed for bankruptcy or are in the process of filing for bankruptcy, and the textile and retail industries continue to shrink, this has not hindered the vigorous development of the Israeli economy. According to a report released by the Bank of Israel at the end of March, Israel’s GDP growth rate was 3.4% in 2017, and the growth rate in 2018 is expected to reach 3.3%.
From the perspective of traditional textiles and retailers, although the government’s motivation to help them out is not sufficient, they still hope that the government will be aware of the difficulties faced by Israel’s traditional industries.
At the end of last year, the Israeli Ministry of Finance announced that in order to reduce people’s living costs, Israel plans to eliminate import duties and purchase taxes on industrial products such as electronic equipment, cosmetics, and toys. In early April this year, Israeli Finance Minister Moshe Kalon stated that further tax reduction measures would be taken.
With the deepening of globalization and the development of e-commerce, Elhara and his colleagues, who make a living in traditional industries, will have to make necessary adjustments. (Title: Israel’s traditional textile industry is “very hurt” under the impact of online shopping)
AAA
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