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Over the first eight months of the year, China's surplus with the US has risen nearly 15 per cent. This has added to tensions in trade relationship between the world's two largest economies. The US is China's largest export market.
Even with US tariffs targeting $50 billion of Chinese exports in effect for their first full month in August, China's exports to the United States still accelerated, growing 13.2 per cent from a year earlier from 11.2 per cent in July. The impact of US tariffs on China’s exports would likely be limited over the next few months.
The surplus with the United States was larger than China’s net surplus for the month, indicating China would be running a deficit if trade with the world’s largest economy was excluded. China’s imports from the United States grew only 2.7 per cent in August, a slowdown from 11.1 per cent in July.
The world’s largest trading nation got off to a strong start this year, but its economic outlook is being clouded by the rapidly escalating US trade dispute and cooling domestic demand. The US has threatened to slap tariffs on nearly all Chinese imports to the United States, threatening duties on another $267 billion of goods on top of $200 billion in imports primed for levies in coming days.
As per latest US Census Bureau figures, overall value of Bangladesh's exports to the US increased 5.83 percent year-on-year to $3.63 billion in the first seven months propelled by higher apparel shipments. OTEXA also reveals export of apparel items grew 5.61 percent to $3.21 billion while Bangladesh moved to the third position from sixth with respect to garment export to the US.
Of Bangladesh's total export value, garment items account for over 90 per cent. China still holds the top position having exported $14.19 billion-worth garment items in the last seven months. However, China's garment export to the US declined 0.83 per cent year-on-year.
The inspection and remediation of factories as per recommendations of the Accord and Alliance has brightened Bangladesh’s image. Both Accord and Alliance have already completed over 90 per cent remediation in the garment sector, mainly fixing electrical, fire and structural loopholes.
Some US retailers who had left Bangladesh a few years ago for countries like Myanmar were coming back with hands full of work orders. Moreover, a lot of work orders from China have also shifted towards Bangladesh as the country has become an expensive destination for higher cost of production and a shortage of skilled workforce.
"Growing online shopping has increased the contribution of online retail sales. Last year, web-based shopping platforms from Amazon to Zalora accounted for 12.1 per cent of retail sales in the Asia-Pacific region. The global e-commerce market is estimated to be worth $2.3 trillion. As online stores deliver everything from furniture to clothing to groceries, consumers today rarely step out of their house to shop. As entrepreneur.com reveals, 51 per cent of Americans and 67 per cent millennials prefer to shop online rather than visit brick and mortar stores."
From buying clothes purely on fads or the desire to look good to buying clothes that complement modern lifestyles, consumers have come a long way. Changing lifestyles have pushed up demand for comfort clothing.
Comfort with style a priority
Growing online shopping has increased the contribution of online retail sales. Last year, web-based shopping platforms from Amazon to Zalora accounted for 12.1 per cent of retail sales in the Asia-Pacific region. The global e-commerce market is estimated to be worth $2.3 trillion. As online stores deliver everything from furniture to clothing to groceries, consumers today rarely step out of their house to shop. As entrepreneur.com reveals, 51 per cent of Americans and 67 per cent millennials prefer to shop online rather than visit brick and mortar stores.
This is also the reason why sale of luxury loungewear has increased over the years. Consumers expect their clothes to be both comfortable and versatile enough to accommodate their hectic schedules without compromising on style. The rise of luxury loungewear is seen as a response to varied lifestyles of modern consumers.
A striking example of this is the cashmere jogger which continued to be the best seller at Haroods – the luxury
department store in 2017. On similar lines, sale of sweatpants at MatchesFashion.com increased 300 per cent year-on-year while British retailer Selfridges registered a 30 per cent year-on-year growth in sales of premium loungewear. The retailer’s of cashmere loungewear pieces also doubled.
Known for their luxurious feel, the clothes made of Tencel, Lyocell marry style and comfort. They increase a consumer’s style quotient by exhibiting a sleek, sumptuous sheen and deeper, richer color compared to other fabrics. More absorbent than cotton, softer than silk and cooler than linen, Lyocell also provides long-lasting softness to help skin stay pleasantly cool and dry through day and night.
Moving towards functional fashion
With busy lifestyles, more travel and varied and flexible work lives, fashion too is adopting a functional approach. Consumers seek comfortable, fuss-free styles that adapt to the moment and can travel anywhere with them.
Also, with consumers becoming more aware about health and wellness, they expect more from the apparel industry, just as the versatility of activewear has grown in response to demand from the athleisure fashion consumer.
Shoppers don’t just buy a product, they buy everything it represents. Still, they can feel limited by choice in a clothing industry that produces some 100 million tons of fibers each year, of which synthetics are expected to be more than 98 per cent of future fiber production, according to petrochemical analytics firm, Tecnon Orbichem.
Consumers who buy eco-friendly clothes can now feel good about opting for garments made of fibres having the least environmental impact. A fiber of botanic origin, Tencel is extracted from the cellulose found in wood pulp, and its production process is more eco-friendly than other fibers in terms of water, land and chemical output. Using a special ‘closed-loop system’ recognised by the European Union with an European Award for the Environment, 99.7 percent of the chemicals and solvents used to make Tencel fibers are recovered and recycled with minimal waste and very low emissions.
Leading busy and aspirational lives, consumers today yearn to make their clothes durable, comfortable, timeless and eco-friendly. Increasingly, the apparel industry is offering up sustainable options to help satisfy that demand.
P Nataraj, Chairman,Southern India Mills Association (SIMA) and Managing Director, KPR Mill says, the performance of textiles industry during the financial year 2017-18 has been slightly better than last year. Yarn and cloth production, during the year, increased to 5,676 million kg and 66,524 million sq m as against 5,667 million kg and 63,482 mn sq m.
Though affected by demonetisation and goods and services tax (GST), the economy was back to normal now, indicating steady growth. Major policy initiatives that could address the GST- related issues were reduction of the tax on man-made filament and spun yarn from 18 to 12 per cent as well as inclusion of all textile job work under a GST of 5 per cent. Though major demands in respect to the GST have been addressed, some issues are yet to be addressed.
The Cotton Campaign has asserted that Uzbekistan should remain on the list of products requiring US Federal contractor certification regarding forced or indentured child labor. The entity is an international coalition of non-governmental organisations, trade unions, apparel brands and investors.
The organisation sent a letter to the US Department of Labor’s Deputy Under Secretary for International Affairs, Martha E. Newton, opposing the department’s recent notice that it has made an “initial determination” to remove cotton from Uzbekistan from the list. The original list was created by Executive Order 13126, signed by President Bill Clinton in 1999.
Given the findings that forced child labor is still being implemented, the letter added it is “crucial” to monitor Uzbekistan’s 2018 cotton harvest “to ensure that the Uzbek government’s high-level commitment to eradicate forced child labor is consistently implemented on the ground.
India has proposed stricter rules of origin in the Regional Comprehensive Economic Partnership (RCEP) trade agreement to prevent Chinese goods from indirectly flooding the country. Rules of origin are the criteria needed to determine the source country of a product, based on which they get tariff concessions or are subjected to duties. India has said the last country from which a product is exported should do the highest value addition with the help of indigenous inputs.
Globally, the average threshold on domestic content is 40-60 per cent for getting originating status to a product. The need for strict rules of origin comes in the wake of India having a trade deficit with as many as 10 member countries of the RCEP, including China, South Korea and Australia and which has increased in 2017-18 with seven countries.
RCEP negotiations were launched in November 2012 and the first round of negotiations was held in 2013. However, trade experts have said that stricter rules of origin with China may not benefit as Beijing circumvents its exports through India’s other neighbours.
Drapers Sustainable Fashion, to be held on March 14, 2019 in London, will bring together the most sustainable brands and retailers, trailblazers and disruptors, progressive thinkers and pioneers to discuss what can be done for sustainable fashion and why change is not optional.
Sponsored by Isko, the event will be attended by fashion brands and retailers, clothes manufacturers, supply chain experts, innovators and anybody for whom sustainability matters. The event profile will comprise negotiations, projects showcasing sustainability in action, and start-up innovations. It will deal with the potential of sustainability to make a difference to the world.
The first half of the day will be dedicated to a series of keynotes – a combination of standalone talks, interviews and debates, which will be presented by world-leading retailers, brands and experts, who are pushing the sustainability agenda in fashion retail. They will focus on how to turn the fashion business into an ethical, environmentally friendly and profitable industry.
In the afternoon, brands will showcase clothes made out of recycled bottles, mobile repair stations, laser and 3D technologies. The event will showcase the projects and initiatives that are pushing the boundaries of sustainability.
Welspun India expects its volume to grow at eight to 10 per cent in the current financial year. The textile maker is witnessing a substantial pickup in demand from the US. The company is seeing substantial growth in e-commerce and has developed a few products for the online marketplace as well.
Capacity utilisation has gone up from 80 per cent clocked in the previous financial year. The plan is to invest Rs 900 crores as a part of capital expenditure. Capital has been set aside for a new flooring unit in Telangana. Indian cotton exporters have gained prominence in the US over the last six to seven years, driven by healthy cotton production and lower labor costs.
The company has a guidance of eight to ten per cent in volumes for the current financial year. Hydro cotton has been commercially successful and continues to see good growth. Welspun sees a promising future for WEl-Trak after the success of hydro cotton. The textile firm sees a positive growth momentum in volumes and is confident of achieving its annual guidance for revenues and profits. Welspun continues to pursue its differentiation strategy based on branding, innovation, sustainability and its patented traceability solution.
Discussions on the proposed Regional Comprehensive Economic Partnership (RCEP) are proceeding more or less smoothly. Despite treading diametrically opposite paths on tariffs and market access, India and China, along with other nations, have hit it off on points regarding investment norms. The RCEP is a proposed pact between 10 Asean economies and six other nations (New Zealand, Australia, China, India, Japan and South Korea).
Most nations have agreed to ease the investor-state-dispute settlement (ISDS) clauses. These refer to a broad range of legal and policy norms regulating the process by which an investing private entity from another nation may seek legal recourse in the event of a dispute with the state. India also secured a commitment that ISDS will also not be valid on prohibition of performance requirements that deals with technology transfer and royalty payments.
India is cautious with regard to any measure that allows the aggrieved party to approach an international tribunal of law due to bad experiences earlier. Back in 2012, international investors in telecom companies, whose operational permits were cancelled by the Supreme Court in the wake of the 2G scam, had approached an international tribunal and sued the country for damages. While India avoided paying significant charges, the episode dented the country’s reputation as an investment destination.
Sri Lankan is looking to expand its businesses in Pakistan. Among the companies looking to expand in Pakistan are: MW Ventures and the Hirdaramani Group. Hirdaramani is a pioneer in the Sri Lankan apparel industry, and boasts of a cohesive infrastructure providing end-to-end supply chain solutions to the industry through factories in Sri Lanka, Bangladesh, Vietnam and Ethiopia. Hirdaramani's partnership with leading global brands has helped it gain a reputation for streamlined processes and top-quality products.
MW Ventures is a service oriented organisation comprising different sectors of expertise focusing on marketing, financial management, and event management. It also provides financial management solutions for businesses or for individu Foreign investment in Pakistan is protected by rigorous laws and foreign direct investment regulations allow full repatriation of capital and profits. Moreover, Pakistan’s location on the cusp of important economic regions, young population and skilled labor force supported by a rapidly growing technology infrastructure has made it an attractive destination for investment not only for the domestic market but also as a production and export hub for the rest of the world.
Sri Lanka has aspirations to become a middle-high income country by 2025 by having a highly competitive economy with a diversity of products and services for local requirements and export markets.
