Tariff hike should benefit footwear

Brazilian footwear manufacturers are expected to benefit from Argentina's increase in import tariffs for consumer goods to 35% for non-members of the Mercosur trade bloc. Local shoe exporters 'which operate in the niche of low priced products will have an advantage in relation to Asian producers', said Cristiano Korbes, head of foreign affairs at footwear manufacturer Dakota, whose sales are on the increase. 'But the measure will principally help companies which operate with quality shoes, due to the reduction in the competitiveness of the Italian product, well accepted in Argentina', he said. The footwear industry association Abicalçados said that shoe exports totalled $414.6 million in the first quarter of 2000, up 12% from the $368.7 million worth of shoes shipped abroad in the same period last year. The price of a pair of shoes rose from an average $8 to $8.80 in the period. Foreign sales also grew 3% in volume, to 48.8 million pairs. The US is Brazil's biggest market, accounting for 70% of the country's footwear exports. According to Abicalçados' foreign market vice-president, Ricardo Wirth, at this pace the sector should meet its 15% revenue growth target for 2001. Last year, footwear exports turned over $1.6 billion with sales of 162.5 million pairs. Wirth recalled that the price of shoes will rise due to the increase in leather quotations. 'There will be no change in deals which have already been closed, but we should see alterations as of August', he said. The price of imported leather has increased 20% in the last three months, while the domestic price has surged 40%.