The country’s sole manufacturer of knitting yarn Karina (Pvt) Ltd has applied to the High Court for provisional liquidation, as the textile sector continues to struggle due to cheap imports from China and under-capitalisation.
Karina Holdings becomes the second major textile industry player to face closure after David Whitehead was put under judicial management last year.
According a government Gazette dated June 22 2012, the company is now on the brink of collapse. “In the matter between Karina Holdings Limited, applicant and Karina (Pvt) Limited, respondent for its winding up . . .
Take note that on Wednesday the 13 the day of June, 2012, the High Court at Harare, issued an order for the provisional liquidation of Karina (Pvt) Ltd and Theresa Grimmel has been appointed provisional liquidator of the company,” the Gazette reads.
“Any interested person who wishes to oppose the winding up of the company shall file a notice of opposition with the registrar of the High Court at Harare, on or before the 6th day of July, 2012, and shall serve a copy of the notice on the applicant.”
Karina was established in 1959 under the name Ferguson Shiers manufactruring carpets in Mutare. Ten years later the company expanded into knitting yarn manufacturing.
The textile sector, according to reports, has lost more than 5 000 jobs due to viability constraints. In the state of the economy address for the 2012 first quarter Finance minister Tendai Biti said the manufacturing sector registered modest gains from January and March. Biti said the sector was projected to marginally grow by 9,9% from 9,7% recorded in 2011.
“Notwithstanding the overall gains in most of the sub-sectors, the textile, clothing and printing industry remains under stress,” Biti said.
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The minister early this year scrapped the customs duty on clothing and footwear that was proposed in the 2012 Budget as there was an outcry from the public.
Biti had proposed that customs duty on textiles and clothing be reduced from $10 per kg to 40% plus $2,50 per kg and duty on footwear be reduced to $2,50 per pair from $5.
