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Companies in Vietnam's garment and textile sector are actively seeking new suppliers of materials to reduce their dependence on imports from China.
Finding material suppliers from countries other than China, which is currently the main supplier to Vietnam, is seen necessary for two reasons. First, is to reduce dependency on China, and second is to prepare for the Trans-Pacific Partnership (TPP) agreement, expected to be signed later this year.
The TPP agreement is likely to apply the yarn-forward principle, where fabric and garments made from yarn imported from China, which is not a part of TPP, would not enjoy duty-free benefit for exporting to other TPP-member countries.
For the first five months of 2014, Vietnam’s exports of garments showed a positive trend. Vietnam’s fabric production from natural fiber during January to May 2014 was 129 million sq m, registering an increase of 17 per cent year-on-year. However, production in May dropped by 5.4 per cent over April figures. In May 2014, Vietnam’s exports of garments and textiles showed a decrease of 8 per cent compared to April exports.
The Vietnam Textile and Apparel Association has asked enterprises to explore importing materials from countries like India, Indonesia, Malaysia, South Korea and Thailand.
Invista and Lenzing, specialized fiber producers once again collaborated for Fall/Winter 2015-16 to promote new styles with Tencel/Lycra and DualFX technology. Both companies showcased these collaborations during the recent denim trade shows held in May 2014. Invista presented them at Kingpins in Amsterdam, while Lenzing introduced them at Denim by PV in Barcelona.
Among mills who have pioneered this concept, Tejidos Royo of Spain and ADM of Pakistan, showcased their latest range at Kingpins Amsterdam and at Denim by PV in Barcelona. While Royo’s MeSu line includes fine, sophisticated denims made with Tencel/Lycra and DualFX technology, ADM believes that combining Tencel/Lycra and DualFX technology makes jeans wearable all year long.
Two European mills who are introducing Tencel/Lycra and DualFX technology for the first time this season include Textil Santanderina from Spain and Orta from Turkey. Textil Santanderina is using the innovation to get shape retention even in super skinny jeans along with the super soft hand feel of Tencel and cotton for their ‘Superlast’ collection.
From North Asia, both Central Fabrics and Prosperity have used this novel option of combining these two fibers.
The competitiveness of Chinese clothing industry is set to weaken over the next few years as costs rise. Hence, export growth could falter. The rise in costs in China stems in part from significant increases in fuel and shipping costs. Also wage rates have risen to the point where they are higher than in many other Asian countries.
Rising costs in China are already forcing an increasing number of western apparel brands and retailers to cut back on their sourcing from China and have their apparel manufactured elsewhere. The strongest growth of EU clothing import in 2013 was from Bangladesh, Cambodia and Pakistan, while the strongest growth in the US clothing import market was from Bangladesh, Sri Lanka and Vietnam. However, a number of western apparel brands and retailers are expanding their retail operations in China to capitalise on an expected upsurge in domestic demand.
The potential for growth in China’s domestic market is huge. Consumer expenditure per head on clothing in China is extremely small. If expenditure per head in China were to climb, then the additional domestic demand for clothing would more than compensate for any likely fall in exports given that it equates to about nine times China’s clothing exports to all destinations in 2013.
Textile and raw material exports from Turkey, excluding apparel, amounted to $769.8 million during the month of May 2014, recording a rise of 2.8 per cent, compared to the same month last year, as per the data released by the Turkish Exporters Assembly (TIM). According to the May Export Data of TIM, the country exported textiles and raw materials worth $769.8 million in May 2014, compared to the $748.5 million worth of textile and raw material during the same month last year. Textiles and raw material exports in May 2014 accounted for 5.7 per cent of the overall exports made from the country during the month.
During the month of April 2014, Turkey exported textiles and raw materials worth $791.5 million, a jump of 12.9 per cent year-on-year. Textile and raw material exports accounted for 6 per cent of the overall exports made by the country during the same month. In 2013, Turkey exported textiles and raw materials worth $8.39 billion registering a rise of 7 per cent compared to 2012.
All Pakistan Textile Mills Association (APTMA) Punjab Chairman SM Tanveer has demanded that the Pakistani government should announce a stimulus plan to revive the ailing textile industry in the region. It wants a boost to employment and investments in the segment.
The APTMA has pointed out that due to lack of support the industry is increasingly becoming less competitive domestically and internationally. He said that there is a dire need for proper encouragement for development of the sector.
Tanveer points out, although energy projects envisioned by the Chief Minister of Punjab Shahbaz Sharif can be beneficial for the sector, they are long-term plans, and the Punjab textile industry requires immediate relief. The APTMA Punjab Chief added that due to severe load shedding losses of the textile industry are unbearable and the cost of production has increased manifold as compared to the competitors in the region. The viability of the industry will be totally eroded if the government fails to resolve energy-related issues.
He also informed that due to load shedding and shortage of gas supply as well as rising production costs, during last few months, about 375,000 spindles have stopped operation in Lahore and Faisalabad, some 312,000 in Multan and 158,000 in Rawalpindi. Production of more than 100 spinning mills have also been reduced in Punjab as the industry is operating only in one shift.
The Alliance for Bangladesh Worker Safety has surveyed 508 readymade garment units. The survey result shows that 99 per cent of the factories are structurally sound. Less than one per cent of the units surveyed were found to be unsafe in terms of structural integrity.In instances where the buildings are identified as overloaded, factory owners have been urged to take immediate action to reduce the load and reinforce the buildings' columns. Common issues include inadequate fire suppression equipment, lack of fire doors and poor electrical wiring.
Workers who are unable to work due to factory closures are being compensated in part by the Alliance's Worker Support Fund, which is made up of dues from each of the Alliance's 26 member companies. Nearly 1,000 workers’ salaries have been paid following Alliance-recommended factory closures to date.
The Alliance has reiterated its commitment to inspect 100 per cent factories by July 2014. Before they are released, inspection reports are shared with factory management and worker representatives. The goal is to ensure that inspection reports are comprehensive and consistent, and done in a way that allows for the process of remediation to continue, while minimising the impact on factory workers.
www.bangladeshworkersafety.org/
The annual pan-African textile, clothing and footwear trade event, Source Africa will take place in Cape Town on June 19 and 20, this year. This is the second edition of the annual event and will include a two day trade exhibition, African country pavilions, international business seminars organised by the American Apparel & Footwear Association (AAFA), an opening plenary session and cocktail receptions.
Another important element of the event would be the professional online matchmaking program. By effectively combining online technology together with a team of business matchmakers, event participants are profiled, and provided access to an online matchmaking calendar with the ability to view and select exactly who they want to meet. The Source Africa Trade Expo is expected to attract over 2,000 decision makers who will have the opportunity to view an extensive range of products and services displayed by more than 180 exhibitors.
Last year’s program demonstrated what can be achieved when USAID’s regional experts join forces with private enterprise, LTE – leaders in trade exhibitions, in South Africa to boost regional industry. It brought together manufacturers, suppliers and service providers, enabling African and international buyers to examine a wide array of products and services under one roof.
Growing awareness about environment is pushing many American denim makers to adopt green technologies for conservation. For example, denim maker Tortoise jeans, which debuted its men’s line in Fall 2013 and is readying the women’s holiday/resort '14 collection featuring unique shades, rinses and washes, follows the Eco Prk wash facilities. The product is made in such a way that reduces the waste of water, energy and use of toxic chemicals.
Tortoise is one of the few names that are experimenting with new environmentally friendly processes of manufacturing apparels. They range from boutique lines such as Tortoise to Levi Strauss & Co. The company wishes that leading brands such as Levi's will eventually influence the entire market to work with more environmentally friendly production methods. In 2012, Levi's introduced the denim line ‘Water < Less’, which cuts the use of water in its production processes. The khaki line Dockers Wellthread collection is experimenting with making socially and environmentally sustainable apparel from a pilot site in Bangladesh.
Eichmann’s denim production follows Eco Prk wash facilities like Wiser Wash production practices. Also building a more ecologically sustainable production are the ozone machines made by Greentech. Greentech’s patent is pending for its ozone machinery. The ozone re-creates and improves washes that have traditionally been produced by acid washing, stone washing and potassium sprays.
Dotan Shoham’s Los Angeles–based Pacific Blue dye house manufactures the Gypsy05 clothing line. Gypsy05 does not use chemicals deemed harmful, and is also working with solar energy to heat water tanks and dryers to cut gas and electricity use. Swedish brand Nudie Jeans focuses on making eco-friendly clothes. To ensure that Nudie's products meet high standards, they are confirmed as organic by Global Organic Textile Standards (GOTS). Nudie also runs inspections of its subcontractors to ensure that workers are treated well. It also recommends consumers not to throw away their jeans but get it repaired at Nudie shops or recycle them into new items such as denim rugs, which Nudie makes.
A textile park is coming up in Faisalabad, Pakistan, with Chinese help. Along with the textile park, Pakistan hopes to acquire modern technology and technical skill. The park is expected to generate lakhs of jobs, lead to substantial increase in exports and usher in a new era of progress and prosperity. A coal power plant of 270 megawatts is also being established in the park.
The project entails an investment of Rs 200 billion in this mega project of weaving, spinning, printing and garments and 35,000 new job opportunities will be created. The Ruyi Masood textile park is being set up with the collaboration of the fifth biggest textile group of China at M-III Industrial Estate, Faisalabad. The Ruyi Textile group has a prominent place in garments, marketing, technology and export sectors at the international level.
Pakistan and China have good friendly relations and share a growing cooperation in the economic and industrial sectors. The establishment of a textile park in the barren land of Faisalabad is expected to not only promote the textile sector but also strengthen the national economy.
Euratex, the European Apparel and Textile Confederation will be hosting the international textile and clothing conference on ‘Free Trade and International Agreements’ on June 5, 2014 in Brussels. The idea behind organizing this conference is to debate the free trade and international agreements’ influence on world markets of textile and clothing.
The confederation expects experts from the textile and clothing industry of countries like: Turkey, Korea, Africa, Japan, Canada, India, Brazil and Taiwan, to attend the conference. This year, Euratex is also celebrating 20th anniversary of the Marrakesh Agreement establishing the World Trade Organisation (WTO). In 2005, the textile and clothing sector became a subject in the general rules of the WTO and all restrictions were terminated after more than 40 years of trade with import quotas.
As per WTO data, the revenue from world textile and clothing exports, excluding intra-EU trade and re-exports, more than doubled between 2000 ($240 billion) to 2012 ($547 billion). Euratex indicates that the establishment of new global rules of trade between nations had an immense influence on the European Union that is the second largest world exporter of textile and clothing products.
The pace of globalisation was also quickened by multilateral trade negotiations of the General Agreement on Tariffs and Trade (GATT) and the increasing importance of the Free Trade Agreements (FTAs). Since the WTO creation, over 400 agreements covering trade in goods or services have been notified. Moreover, the number of ongoing FTAs negotiations launched by the EU has significantly increased. The confederation believes this is the right moment to evaluate the impact of the current and potential of FTAs on companies and SMEs in textile and clothing sector.
Euratex.eu
