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To improve ease of doing business in textile and garment sector, Tanzania’s Ministry of Industry and Trade is consulting stakeholders to review 22 laws and implement regulatory reforms. The Tanzanian government amended two laws in the Finance Act 2020, it its budget 2021-22 speech. It is currently in the process of introducing the Trade Remedies Act 2021 to protect local businesses, control importation of products and market distortion by subsidized products which come to the local market at lower prices.
It also plans to improve the policies and laws to create a conducive business environment. It will cooperate with businesses to create a market for the local products, says Kitila Mkumbo, Minister of Industry and Trade. Tanzania has also scrapped over 232 taxes, fees, levies to reduce the time and costs for securing licenses and permits to do business in the country, Mkumbo adds.
President Samia Suluhu Hassan had urged ministers and government officials to improve the ease of doing business in Tanzania and amend laws that hindered investments.
To strengthen economic cooperation between the two regions, EU and India have agreed to restart the long-halted free trade agreement (FTA). Even since talks were curtailed between the EU bloc and India in 2013, apparel exporters have been urging the government to review India’s trade pacts with the EU. Apparel Export Promotion Council (AEPC) had said India’s apparel exports could double in three years if disadvantages in the trade agreements are eliminated.
The industry body says, India at present has a duty disadvantage of 9.6 per cent in the EU market, when compared with its apparel competitors like Bangladesh, Cambodia, Sri Lanka, and Pakistan. EU’s FTA with Vietnam signed last year has also hit India severely. The industry believes that the EU-Vietnam FTA may hurt India’s garment industry as the FTA abolishes 99 per cent of customs duties which would enable Vietnamese services and public procurement markets to EU companies.
The clear tariff differential in the EU market will add to India’s disadvantages in other areas such as logistics costs and further erode the country’s competitiveness vis-à-vis Vietnam, believe some industry experts.
There is an urgent need to have a level playing field in terms of market access and margin of preference in India’s biggest global market and to correct the distortion that the apparel industry has been suffering.
A sharp increase in clothing prices has doubled the rate of inflation in the UK in April 2021. As per the Office of National Statistics (ONS), UK’s Consumer Price Index (CPI) rose from 0.7 per cent in March to 1.5 per cent in April as clothing and footwear prices rose by 2.4 per cent between March and April 2021. Throughout 2020, clothing and footwear prices followed a different pattern compared to previous years. Clothing prices fell 1.5 per cent in February before rising by 2.4 per cent between March and April 2921. The Retail Sales Index figures by ONS showed a 35.7 per cent year-on-year increase in overall sales in April 2021.
Improved weather during April resulted in greater sales of fashion, particularly in outerwear and knitwear, as the public renewed their wardrobe and made plans to meet friends and family outdoors. Online sales also continued to perform strongly, rewarding those retailers who had invested in their online and delivery operations during the pandemic, said Helen Dickinson, CEO, British Retail Consortium.
However, store footfalls have declined 40 per cent. The end of the full business rates relief in England poses a significant threat to retailers who have spent well over a billion pounds on COVID-secure measures aimed at protecting staff and customers, she added.
Dickinson urged the government to reform the broken business rates system in the ongoing review. This will help the industry to improve digital offering and breath new life into the high streets and town centres, Dickinson added.
Revenue of Korean sportswear manufacturer Fila Holdings grew 25.1 per cent to KRW 988.281 million in first quarter ended March 31, 2021, compared to revenue of KRW 789,901 million in the corresponding period of prior fiscal. The company’s net profit rose to KRW 134,201 million from KRW 39,500 million posted in Q1 FY20.
Gross profit for the reported period increased to KRW 498,541 million from KRW 381,699 million in the previous year while operating profit jumped to KRW 183,569 million.
The company’s revenues from Korea during Q1 FY21 increased to KRW 136,163 million from KRW 128,826 million in the previous year while revenues from US surged to KRW 132,284 million from KRW 106,149 million.
Fila Holdings Corp is a sportswear manufacturer that designs shoes and apparel founded by Ettore and Giansevero Fila in 1911 in Biella, Piedmont, Italy through its subsidiary Magnus Holdings Co. Fila Holdings owns a 52 per cent stake in Acushnet Company, Fila Holdings' largest shareholders include Piemonte Co at around 20 per cent, Fila Holdings at 20 per cent, and South Korea's National Pension Service at around 13 per cent.[ Gene Yoon, who owns a 75 per cent stake in Piemonte, serves as the chairman of Fila Holdings.
LaNyalla Mahmud Mattalitti, Chairman-Regional Representative Council, Republic of Indonesia AA aims to increase apparel exports in line with rising domestic market demand. As per Indo Textiles, demand for apparels has increased significantly in Indonesia due to Eid and reopening of schools and offices. One of the country’s prominent manufacturers, PT Trisula Textile Industries Tbk (BELL) was flooded with orders for uniforms for various government and private institutions, such as banks, hospitals and airlines.
Mattalitti urged other producers to follow BELL's steps in providing good quality fabrics to enable the national market to compete with imported fabrics. He also urged the government to create a conducive investment climate even though it is still a pandemic condition. LaNyalla also requested the government to protect the national textile industry from cheap imports.
As per latest India Ratings and Research (Ind-Ra) report, cotton prices in India are expected to remain healthy in FY22 with largely stable production. However, domestic stock-to-use ratio may decline to 73 per cent for the season ending July 2021, says the report. The US Department of Agriculture – Foreign Agricultural Service (USDA-FAS) also expects stock to use ratio to decline to 60 per cent on likely incremental consumption levels during the next cotton season ending July 2022 against flattish production, said Ind-Ra in the April 2021 edition of its credit news digest on India’s textile sector.
USDA-FAS expects domestic crop to increase 2 per cent YoY in the next season commencing October 2021 while consumption is slated to increase by 6-8 per cent YoY, leading to a reduction in ending stocks. The marginal rise in production is despite an expected lower area under cultivation for the next season, albeit supported by a normal monsoon and increasing yield by 5 per cent to 497 kg per hectare. Furthermore, USDA-FAS expects cotton exports to increase by 0.5 million bales (480lb) to 6 million bales in the next cotton season, supported by lower domestic cotton prices.
The gross margins of cotton yarn prices are expected to remain healthy for spinners on the back of a supportive export demand coupled with a gradual improvement in domestic consumption levels. Furthermore, issues such as Xinjiang cotton could continue to support India’s healthy export levels, despite high cotton prices.
At a recent meeting between International Labor Organization (ILO) and BGMEA, Tuomo Pouliainen, Country Director, ILO praised the development made by Bangladesh RMG sector in the areas of workplace safety and social compliance. Pouliainen also discussed the progress of ongoing projects being jointly implemented by ILO and BGMEA in the RMG sector. He discussed the possibility of collaboration between ILO and BGMEA with Faruque, Hassan, President, BGMEA.
Hassan thanked ILO for providing support to Bangladesh garment industry in ensuring workers' rights and welfare. The meeting was attended by Miran Ali, Vice President, BGMEA, Barrister Shehrin Salm Oishee and Asif Asraf, Directors. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is a nationwide trade organization of garments manufacturers in Bangladesh and is located in the capital city of Dhaka. It plays a pivotal role in the country's earning sector of foreign trades.
With activewear sales expected to grow by 6.5 per cent by 2021-end, many clothing brands plan to launch their new collections in the market, says a report Allied Market Research. It highlights, the activewear market is expected to touch $547 billion by 2024. To explore these opportunities, Kohl plans to include more activewear and outdoor products in its portfolio. The American fashion retailer plans to expand activewear products 20 per cent and launching a new private label activewear brand, partnering Calvin Klein and adding new products from activewear brand Champion. It also plans to enter into a partnership with US clothing brand Eddie Bauer.
In March this year, US sportswear giant adidas joined hands with Peloton to offer their maiden joint activewear collection. The 11-piece collection comprised shorts, tights, tanks, tees, amongst others.
American clothing retailer JCPenney has also redesigned its XersionR activewear line with the help of latest performance technology EverairTM. The design encourages a distraction-free workout for its customers, with sweat-proof pockets, reflective and anti-odour elements besides several other features.
Underwear brand Thinx also ventured into activewear in January 2021 by launching leggings, cycling shorts and training shorts – each featuring Thinx’s much acclaimed absorbent technology. British clothing giant Marks & Spencer plans to expand its Goodmove women’s activewear range by including menswear and kidswear.
Indian artisans have been creating intrinsic designs for global luxury fashion labels for ages. Garments designed by these karigars have adorned the looks of many international celebrations besides helping global brands make millions of dollars. Yet, their talent is rarely celebrated, says a Live Mint report.
Now is the time for global fashion brands to extend their support to Indian artisans. As India struggles with second COVID-19 wave, many of artisans have been rendered jobless, facing stark poverty. Only a few brands like Louis Vuitton have come forward to help these artisans. Others are apathetic to the sufferings of their suppliers, says Maximiliano Modesti, Founder & Managing Director, Les Atelier 2M and the Kalhath Institute. What make the garments produced by most of global brands special are their intrinsic designs. He believes, only Indian artisans have the ability to produce such designs in huge volumes at affordable costs.
Designer Peter Dundasis, who designed the jumpsuit for singer-songwriter H.E.R for the Oscar Awards last month, also vouches for the talent of Indian
artisans. Last year, he collaborated with quaran-T, an initiative by Swedish brand incubator Bozzil and Mumbai embroidery house Saks India to celebrate their works.
Faulty perception, unstable demand
London-based designer Osman Yousefzada, opines, one reason Indian artisans do not get due credit is the perception by European luxury brands of their skills as just a craft and not design. Another reason is the use of Indian crafts according to brands’ whims and fancies, adds designer Rahul Mishra who has been struggling to complete his collection before Paris Haute Couture Week in July owing to migration of artisans to their hometowns during the lockdown.
Proponents of change
One of the few brands that have acknowledged their connection with Indian karigars is sportswear brand Lululemon. The brand recently donated $200,000 for the rehabilitation of artisans displaced by the pandemic. Embroidery houses like Saks India are also supporting these artisans. The export house did most of its product sampling in-house during lockdown to support craftsman, informs Sajjad Khan, Founder.
Responsibility to artisans
To change the current scheme of things, global brands need to recognize India’s role in their success, views Modesti. They cannot remain silent on their India connection, he adds.
Yousefzada agrees, brands are responsible for the well-being of their overseas craftsmen and workers. They cannot ignore their commitment towards Indian artisans. He advises luxury brands to acknowledge their works by adding the line on ‘Hand Embroidered in India,’ on their garments.
Data compiled by Pakistan Bureau of Statistics shows, Pakistan’s exports of textile and clothing rebounded in April mainly due to value-added sectors and posted a robust growth of 231.17 per cent from a year ago.
The highest growth in exports in April is due to low-base of last year when export-oriented industries remained closed due to the COVID-19 lockdown and cancellation of orders from international buyers. As a result of this low base, growth was reflected in value-added and non-value added textile products.
During July-April, the value of Pakistan’s textile and apparel exports reached $12.692billion against $10.816billion over the corresponding months of last year, showing a growth of 17.35pc.
Product-wise, exports of ready-made garments increased by 12.56per cent in value, followed by knitwear 30.69per cent, bedwear 24.66per cent and towels 27.18per cent during 10MFY21. Pakistan and China’s apparel exports posted a substantial growth to United States compared to regional countries during the past few months.
According to the PBS data, the export of cotton yarn grew by 164per cent in April from a year ago. However, export of cotton yarn posted a negative growth 4.03per cent in 10MFY21.
The exports of cotton cloth revived and posted a growth of 200.44per cent in April from a year ago. In the non-value-added sectors, exports of tents and canvas were up 21.86per cent followed by art and silk which increased by 10.52per cent, made-up articles excluding towels and bedwear were up 22.22per cent and other textile products saw an increase of 39.24per cent during the 10-months under review.
Between July and April, the overall exports reached $20.905billion as against $18.398billion over the corresponding months of last year, indicating a growth of 13.63per cent.
