Government acknowledged impact of online shopping very late — sector leader

AMMAN — The government “did not realise the effect that online shopping would have on the garment sector soon enough”, as put by President of the Textile and Readymade Clothes Syndicate Muneer Deyeh.

Deyeh, whose sector has been suffering throughout 2018 until now, said the syndicate “warned” the government about what people’s shift towards online shopping from stores outside of Jordan would do to the sector.

“Local shop owners pay more than 50 per cent in taxes while clothes and shoes coming into the country from different foreign online shops are not subject to customs. Of course the items will be cheaper and thus more appealing to the customer,” he told The Jordan Times on Tuesday.

Deyeh said the sector’s problem is not the local shop owners’ inability to market their products online or provide delivery services on par with foreign dealers, but it is their inability to compete with their prices.

Given the 60 per cent drop in sales during 2018 and the continued decline during the first months of 2019, the syndicate’s president said that the Minister of Finance Ezzeddine Kanakrieh recently told him that he “realised online shopping has hurt the sector and thus the country’s gross domestic product”.

“The statement is eight years late,” said Deyeh.

According to the syndicate’s latest surveys, packages received in the Kingdom from online shopping stores stood at an estimated worth of JD45 million, and the number is said to be on the rise.

“The government has to either decrease taxes on imported products or impose customs on packages from online shopping. The former is, of course, more favourable to both citizens and stakeholders,” concluded Deyeh.

The Ministry of Finance was unavailable for comment despite several attempts by The Jordan Times.