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Bangladesh's export earnings will cross $ 600 million in five years. This was announced by the commerce minister Tofail Ahmed. As the chief guest, he was addressing the opening ceremony of three international trade shows on RMG sourcing in Dhaka on yesterday.
He further went on to say that when the Awami League assumed office, the export earning of the country was $ 14 billion. Last fiscal year, the exports clocked $ 34.2 billion. If the trend continues, the export earnings would exceed $ 60 billion in 2021, he added.
Further Tofail Ahmed declared that the government was offering 15 per cent cash incentive in furniture, 10 pc in plastic and 20 pc in agricultural products. Stating that ready-made garment (RMG) was the main forex earner of Bangladesh as nearly 82 pc foreign currency come from this sector, he said that RMG has reached this stage overcoming difficulties and it also has the potentiality to go a long way.
More than 30 products of packaging and accessories sector are required for RMG and those were used to import from abroad. Now the packaging and accessories products are being exported meeting local demand and the export of this sector would stand at $ 18 billion from the existing $ 6.12 billion, he said.
The three exhibitions - the 16th edition of Garmentech Bangladesh, the 8th edition of International Yarn & Fabrics Sourcing Fair and the 8th edition of GAP Expo - are being held simultaneously at International Convention City Bashundhara, Dhaka.
"Brexit is going to have an adverse impact on Cambodia’s garment export sector, the International Labor Organization (ILO) has warned. Though new duty-free access to the US will ease pressure on exporters for some time, Cambodia’s recent rise to lower-middle income status could also add to its challenges in a few years. International Labor Organization wage specialist Malte Luebker said, “Exports continued their strong growth over the first half of last year, up 10.8 per cent year-over-year to $3.5 billion."
Brexit is going to have an adverse impact on Cambodia’s garment export sector, the International Labor Organization (ILO) has warned. Though new duty-free access to the US will ease pressure on exporters for some time, Cambodia’s recent rise to lower-middle income status could also add to its challenges in a few years. International Labor Organization wage specialist Malte Luebker said, “Exports continued their strong growth over the first half of last year, up 10.8 per cent year-over-year to $3.5 billion.”
Garments currently make up roughly 80 per cent of Cambodia’s total exports and have been its most reliable growth engine for the past several years. The country has struggled to diversify its economy beyond garments, tourism, agriculture and construction.
Uncertainty of future business
Thanks to the EU’s Everything But Arms trade scheme, Europe has been Cambodia’s No. 1 garment export market since 2014, with the UK topping the list. But the pound’s slide against the dollar — 20 per cent between the third quarters of 2015 and last year — is making those exports more expensive and could lead to a drop in orders. “Although Britain has not yet withdrawn from the EU, the depreciation of its exchange rate means that the trading environment has already become more difficult for the Cambodian garment and footwear sector. If this depreciation is long-term, this difficulty will endure,” the report highlighted.
Post-Brexit, Cambodia may face more long-term trouble if it loses the preferential access it now enjoys under Everything But Arms. The ILO says the UK could maintain that access for Cambodia and other so-called Least Developed Countries, or revert to World Trade Organization rules. In the latter case, Cambodia would lose its special access unless the government arranges a new free-trade agreement with the UK.
Duty free access to the US
The ILO says the duty-free access the US granted Cambodia’s travel goods exports such as wallets, handbags and suitcases could help grow the industry, which is categorised as a sub-sector of garment manufacturing in the coming years. However, it remains in its infancy and currently accounts for only 1.3 per cent of total garment exports. At the same time, Cambodia’s move last year from low to lower-middle income status means the country could lose its Least Developed status after a three-year grace period and the special access it gets to the rest of the EU along with it. “The Cambodian garment and footwear sector has some time to prepare for an environment in which its competitive advantage is reduced through loss of (Everything But Arms) status,” the ILO says, “but it will need to adapt to this reality over the medium term.”
"A recent study ‘Measuring fashion: environmental impact of the global apparel and footwear industries’ highlighted apparel industry has a major impact on climate. Combined, global apparel and footwear industries account for roughly 8 per cent of the world’s greenhouse gas emissions. That’s nearly 4 metric gigatons of CO2-eq, almost as much as the total climate impact of the European Union, according to ClimateWorks Foundation and Quantis, the publishers of the study."
A recent study ‘Measuring fashion: environmental impact of the global apparel and footwear industries’ highlighted apparel industry has a major impact on climate. Combined, global apparel and footwear industries account for roughly 8 per cent of the world’s greenhouse gas emissions. That’s nearly 4 metric gigatons of CO2-eq, almost as much as the total climate impact of the European Union, according to ClimateWorks Foundation and Quantis, the publishers of the study.
Over-consumption seems to be the reason behind this burning issue. The average global citizen consumes 11.4 kg (25 pounds) ofapparel each year. That translates to 442 kg of CO2 emissions per capita, or the same amount it would take to drive a car for 1,500 miles. Apparel makes up the lion’s share of that total, accounting for 83 per cent, while footwear contributes to 17 per cent of those emissions. The study also highlighted that in a business-as-usual scenario, the apparel industry’s climate impact is expected to increase 49 per cent by 2030, meaning the apparel industry alone will emit 4.9 metric gigatons of CO2-eq, nearly equal to today’s total annual US greenhouse gas emissions.
Diving deep More than 50 per cent of emissions are coming from just three stages: dyeing and finishing, yarn preparation, and fibre production. Fibre production, the first noted stage in the garment life cycle, accounts for 15 per cent of apparel’s total climate impact. Yarn preparation accounts for 28 per cent and fabric preparation, including knitting and weaving, contributes to 12 per cent of apparel’s impact on the climate. Dyeing and finishing alone contributes to 36 per cent of the impact, as it demands the most energy and substantial amounts of heated water. Cut and sew assembly accounts for 7 per cent of the adverse contribution to the climate, while distribution accounts for 1.3 per cent though that number could climb if companies increase their reliance on airing goods in response to speed to market demands.
Measures to be taken Companies will need to rethink energy. The biggest pollutants in the apparel supply chain depend on coal and natural gas to heat and power them, which means a massive reliance on fossil fuels. If manufacturers could shift to 60 per cent renewable energy and reach 60 per cent energy efficiency by 2030, that could contribute to an 80 per cent reduction in greenhouse gas emissions. On the supply side, digitalisation can lead to process efficiency improvements by reducing raw materials and waste. New technologies can also improve energy efficiency to further reduce emissions in key life cycle stages like dyeing and finishing and yarn preparation. On demand side, smart(er) consumption models, such as garment and accessory leasing or take-back programs, can extend the use phase of the article, reducing demand for new products. The final key area of focus expected to drive a significant reduction in apparel’s environmental impact, is looking to more preferred and recycled fibres.
Circularity is the key Though circularity has been among the biggest buzzwords in the past year, moving to a more circular economy, it seems, can’t be the only solution either. Circular material flow alone is not enough to ensure the apparel sector greatly reduces its impacts by 2030, as such solutions (that focus primarily on increasing rates of clothing recycling and recycled fiber content) do not alter the impacts of key production stages, such as dyeing and finishing.
Garment recycling is only sustainable when combined with a reduction in consumption of fast fashion and must take into account global equity considerations (evidenced by increasing bans on imports of second-hand clothing in developing nations. The scale of impact reduction this industry must achieve in the coming decade will only be possible with a combination of increased circular material flow, rapid transition to renewable energy sources, a significant increase in manufacturing process efficiencies, and smart design.
Due to short supply and improved exports as well as demand from domestic mills, prices of cotton may touch Rs 43,000 per candy by end of January. The price of the commodity has already surged 10 per cent to Rs 41,500-42,000 a candy in last two weeks. According to industry sources, daily arrival of cotton, which should have been more than 225,000 bales (a bale of 170 Kg), is about 150,000 bales. Everyone is trying to meet their export shipment deadlines and domestic demand and prices remain firm. Traders and ginners aver that farmers want cash rather than cheques and that's why they are holding the crop.
Bhagwan Bansal, President, Punjab Cotton Ginners Association says price of cotton have gone up due to short arrival and good demand from domestic mills and exporters. It may continue to increase further as there is no hope for rise in supply in the near future and pipeline is still dry. Due to cash shortage, farmers desist to bring raw cotton in the mandis across India. Kapas prices are ruling in a range of Rs 1,100-1,160 per 20 kg. According to Bansal, cotton prices may go up to Rs 43,000 per candy in the next one month if supply doesn't improve.
Exporters have no choice but to buy at any cost as they have to fulfill prior commitments. According to the exporters, they have not made forward contract for February and March in this season, because of the constant rise in the cotton prices.
In its bid to bring about a change in lives of some of the world’s 40 million garment workers, outdoor clothing retailer Patagonia has released a short 13-minute film, made in association with Little Village Films. Named Fair Trade: The First Step, it depicts the daily routine of a young Sri Lankan mother who works as a sewing machine operator in a factory that sews Patagonia clothing and her five-year-old son, who is able to attend the beautiful daycare built with the factory’s Fair Trade premiums. Some of the footage depicts the atrocious conditions, including chemical exposure, experienced by laborers in conventional factories, which really puts the Fair Trade experience into perspective.
So far Patagonia has sold 218 Fair Trade-certified clothing items (up from 11 in fall 2014). Now, it plans to reach 300 items by the end of 2017. The certification exists in factories as far as countries like Thailand, India, Colombia, Mexico, Vietnam, and Nicaragua. The clothing is certified by Fair Trade USA, which is a different entity than Fairtrade International but follows similar guidelines. This is an admirable step for a company that’s already renowned for its social and environmental progressiveness. Patagonia never fails to impress.
The National Tariff Commission (NTC) has slapped provisional countervailing duty on the import of Indian fine cotton yarn for four months. The duty, ranging from Rs 26.89 to Rs 55.8 a kg, will apply on the import of cotton having 55.5 or more counts originating or imported from India. The duty will not be levied on imports of the investigated product that are to be used as inputs in products destined solely for exports and are covered under any scheme exempting customs duty for exports under the Customs Act of 1969.
Last year after a complaint lodged by All Pakistan Textile Mills Association (APTMA) on behalf of the domestic industry, the commission opened a countervailing investigation under Section 11 of the Coun¬tervailing Duties Act of 2015 on April 20. The said duty is an import tax imposed on certain goods to prevent dumping or counter export subsidies.
Under the investigation, three Indian producers of fine cotton yarn (carded or combed) were selected for determining subsidies on the basis of the information provided by them and the government of India. The NTC concluded that the subsidised imports had hurt the domestic industry as they suppressed domestic prices.
The three India exporters that were selected for investigation by the NTC were slapped with Rs 26.89, 50.81 and 48.10 per kg provisional amount of countervailing duty, while a duty of Rs 55.8 per kg has been imposed on other Indian exports of fine cotton yarn.
As the most optimistic market in Asia Pacific, India tops the Mastercard Index of Consumer Confidence rankings with Myanmar, Vietnam, Philippines and Bangladesh rounding off the top five. The overall consumer confidence in Asia Pacific continues to be steady showing stability (within plus or minus five points from the previous survey) in nine out of 17 markets. With an increase of 1.2 points in the overall score from the first half of 2016 to 60.9 points in the second half, Asia Pacific sits just above the 60 point optimistic mark.
However, the overall stability indicates some significant movements across five markets compared to six months ago. Hong Kong, Thailand and Bangladesh saw more than 10 points improvement while Malaysia and Taiwan saw decreases more than 10 points.
Bangladesh recorded the largest gain of 11.2 points to 82.8 points, a significant improvement in the overall consumer confidence compared to the first half of 2016 where it saw a relatively smaller increase of 4.2 points. The country’s increase in score was backed by an improvement in all components, the largest coming from heightened expectations in stock market movements (+24.6 points). Both Thailand and Hong Kong also saw a large improvement of 10.1 points, putting Thailand in optimistic territory and Hong Kong in neutral territory.
On the other hand, eight of the 17 markets saw a fall in confidence levels. The biggest decline in optimism levels was observed in Taiwan, followed by Malaysia, and Myanmar. According to the survey, prospects for the stock market were the key driver of the decline.
Hosiery exporters in Pakistan want the surcharge on export proceeds to be abolished. There is a 0.25 per cent export development surcharge, which is deducted from export proceeds.
Exporters say abolishing surcharge will help them use the cash liquidity for enhancing exports. Stitching units want to be allowed to import raw material under the Duty and Tax Remission for Export (DTRE) scheme. At present, they cannot import raw material under the DTRE system. There are about 13,372 circular knitting machines, 10,646 flat knitting and 23,241 socks knitting machines in the country. Capacity utilization is around 70 per cent.
The readymade garment segment has emerged as an important small-scale industry in Pakistan as products have strong demand both at home and abroad. The garment industry is a good source of employment to a large number of people and it mainly uses locally produced raw materials. The machines used by the industry are imported or locally made and assembled. Production of garments by units depends on export orders directly or indirectly and these orders have somewhat risen in terms of value, but they have fluctuated widely in terms of quantity.
HanesBrands, a leading global marketer of everyday basic apparel under world-class brands, has earned above-average scores for water management and supply chain after voluntarily disclosing data for the CDP 2016 Climate Change Report. CDP, formerly known as the Carbon Disclosure Project, is a global disclosure system that enables companies and other entities to measure and manage environmental impacts.
Hanes’ A- water score was higher than the apparel industry and S&P 500 averages in the following categories: context, governance and strategy, direct risks and response and indirect risks and response. The company’s B supply chain score was ahead of the supply chain average in all reporting categories: governance and strategy, risk and opportunity management and emissions management.
Hanes scored high because it owns the significant majority of its manufacturing and supply chain operations, achieved its CDP scores for implementing a range of best practices to reduce water use and mitigate water risk, along with a holistic program to reduce energy consumption in its supply chain. The company has set 2020 goals of 40 per cent reduction in energy use and carbon emissions, 50 per cent reduction in water use, and sourcing renewable energy for 40 per cent of the company’s needs.
Bangladesh is hosting Gapexpo from January 18 to 21. Some 400 exhibitors from 24 countries are participating in the ongoing expo. On display are latest collections of garment accessories, packaging including labels, zippers, tags, tapes, thread, ribbon, buttons, rivets, laces, hooks, transfer film, paper, ink etc.
Gapexpo provides a platform for members to display their collections to readymade garment exporters and buying houses. The Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association was set up in 1989. It represents more than 1,500 garment accessories and packaging industries in the country. This sector earned $6.12 billion during 2014-2015. This figure is likely to touch $12 billion by the end of financial year 2018 and $18 billion by the end of 2025.
The garment accessories and packaging sector is an important component of backward linkages, which is critical for the growth of the readymade garment sector in the country. By way of support to the sector Bangladesh is thinking of cash incentives for exporters of garment accessories and low interest bank loans for infrastructure development, which can boost the sector and create more jobs. The country has already established an international standard accessories sector, which contributes to value addition and reduces lead time.
