The spinning and weaving industry is one of the country’s oldest and saw its heyday during and after World War II. Under Gamal Abdel Nasser’s regime, the industry underwent drastic changes with the country’s turn to socialism and has been reeling ever since.

More recently, the industry has been affected by two major decisions: the move toward privatization and the establishment of the business sector (state owned companies put up for sale) and the liberalization of the cotton trade in 2003.

Over the last 15 years, the gross industrial product has not exceeded $3.6 billion (LE 21.7 billion), but textile exports have represented 27% of overall industrial exports over the last few years. More recently, sources from the Spinning and Weaving Export Council revealed that textile exports grew 65% in the first quarter of 2011 compared to the corresponding period of the previous year despite the revolution and political turmoil. Most of the growth has been attributed to the increase in the international prices of yarn. The total exports for the quarter are estimated at LE 1.4 billion in deals concluded before the revolution.

In 2010 total textile exports reached $2.4 billion (LE 14.5 billion), that breaks down to $1.5 billion (LE 9.03 billion) in ready-made garments, $800 million (LE 4.8 billion) in home textiles with the balance in exports of yarn and other textiles. In the same year, total imports reached $50 billion (LE 301.1 billion).

The spinning and weaving industry is mainly divided into three sectors: the state-owned business sector that includes the ginning, spinning and weaving industries which is comprised of 32 companies; the investment sector that includes companies mainly owned by foreign investors; and the private sector, including companies owned by Egyptian investors and entrepreneurs. The latter sections are made up of over 4,100 companies. The investment and private sectors include companies working mainly in the production of ready-made garments and home textiles.

Although the revolution has not had a major impact on the production process or exports, it has had an impact on labor movements giving more room for freedom of expression. During 2011, the Independent Union for Egypt’s Workers was established and the sector witnessed tens of demonstrations and sit-ins.

Kamal Abbas, head of the Center for Trade Union and Workers’ Services, says there were three segments of the sector that demonstrated: workers of companies whose privatization was not complete due to a court ruling canceling contracts, workers of the business sector calling for reforms and workers in the private sector calling for better conditions and higher wages.

Chairman of the Textile Industries’ Chamber Mohamed El-Morshedy insists the whole industry is at risk, with some 900 factories under threat of closing down. Other people working in the business do not agree but are cautious about the industry’s long-term future.

Most significantly, toward the end of the year, Minister of Trade and Industry Mahmoud Eissa issued a package of 20 decrees to rescue the spinning and weaving industry. The decrees included imposing protective fees on yarn, ready-made garments, textiles and carpet imports. They also put into motion ministerial decree 1773 for 2000 pertaining to banning the purchase of imported goods that have a local equivalent, monitoring commercial and industrial imports, shortening the period of temporary permits to one year from two, imposing stringent control measures like unannounced inventory checks, communicating with custom authorities to ensure temporary permit imports are not used for other purposes and allowing the release of such goods at a maximum of 150% of the producers’ production capacity. The decree also states firmly that there will be no leniency for smugglers. Bt