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Southeast Asia and Europe are working toward for a free trade pact. This is their way of fighting protectionism and the threat of global trade wars. The US is embroiled in trade war with China and close allies including the European Union, imposing tit-for-tat tariffs on billions of dollars worth of goods and heightening fears of economic pain that could spread worldwide.
The EU has assured Southeast Asia countries that they can count on Europe as a free trade partner. The EU has been negotiating bilateral trade accords with several Asean states and hopes these will be the stepping stone towards a future region-to-region deal. There is concern over looming trade wars since a war has no winners.
Asean, a 10-nation region of 650 million people with some of the world’s fastest growing emerging economies, has been keenly forging free trade pacts among its members and regional trading partners. The EU and Asean launched talks towards a trade pact in 2007, but the EU opted out of the process two years later -- partly due to problems with the then-military ruled Myanmar. But both sides agreed to reboot trade ties last year with the possibility of an accord between the two regions.
Higher supply and pressure from buyers led cotton prices to drop over seven per cent in the Brazilian market in July. As for higher supply, it was due to the advanced harvesting of the 2017-18 crop. Some processors were trying to acquire only small amounts for prompt delivery, while others were focused on the delivery of the cotton previously purchased, which was still slow.
Several batches of cotton on sale had lower quality cotton, resulting in a fierce competition between purchasers and sellers regarding price and quality in July. As for future trades, agents were more active in the market in the first fortnight of July, when international quotes rose. Liquidity was higher in the domestic market and for exports, mainly for trades of batches from the 2018-19 crop.
At least 52.4 per cent of the 2017-18 production was traded, with 51.1 per cent allocated to the domestic market, 34.7 per cent for exports, and 14.3 per cent for flexible contracts, i.e. exports with an option to sell in the Brazilian market. About 75.9 per cent of the 2016-17 Brazilian crop has been harvested. Of this total, 62.3 per cent was allocated to the Brazilian market, 27.3 per cent to the international market, and 10.5 per cent to flexible contracts.
Dutch fashion brand Botter has made a unique, environment-centric fashion statement. It has come up with a unisex collection, which uses fish-shaped pool inflatables, nylon nets, and strips of plastic to accessorize its fashion-forward collection of boxy suits and street wear.
The idea is to focus on the pollution of the Caribbean, the waste washing on its shores, and how consumerism and oil exploration are destroying that region of the world. The brand also drew inspiration from lotto houses in Curaçao and the Dominican Republic.
Botter’s collections are forms of social commentary and bring up issues like discrimination and immigration. Vibrant and provocative, each collection focuses on the enormous potential of the rebellious youth that are seen as a constructive rather than ominous force. Each collection starts with diligent research for images, motives and ideas. One collection thematises the role of clothes as contemporary armor that can protect against prejudice and discrimination.
Fish or Fight is a collection that mixes street-style tropes with power-dressing staples. The fight in the title stands for the hardships one has to struggle with as a young immigrant from the Caribbean in Europe. Fish, on the other hand, refers to the destiny of those who stay in the region, where fishing is one of the few occupations young people can possibly get into.
Bangladesh has hiked corporate tax rate for apparel manufacturers and exporters to 15 per cent from the existing 12 per cent. And the rate of green factories has been increased to 12 per cent from the earlier 10. This is not being seen as a positive move by the industry, which is already facing price pressures, falling margins and rising operational costs.
This is especially true for owners of green facilities. In the first place, the investment on a green unit is high and so are the overheads and maintenance costs compared to a regular factory. The industry needs to come up with innovative solutions to cut costs and stay competitive. Some of the other ways to deal with this hike would be to increase efficiencies and go for value additions.
There is another separate 12.5 per cent tax structure proposed for public limited companies, which is seen as a move to encourage the participation of apparel units in the capital market – which is considerably low in Bangladesh. The only saving grace from the entrepreneurs’ point of view has been source tax has come down from the proposed one per cent and reinstated at the earlier 0.7 per cent.
"With Leatherworld Paris, Messe Frankfurt France intends to launch equivalent flexible materials such as fake fur - the quality and technical properties of which have improved considerably to the point of providing competition for genuine fur. This inclusion in Leatherworld has generated tremendous response with clothing manufacturers eager to attend the show. Leather and associated materials, especially those used for accessories, or often extensively for clothing, will be grouped here in one area, simplifying searches by prime contractors."
Messe Frankfurt France will hold Leatherworld Paris, an international trade fair dedicated to leather clothing, accessories and products and equivalent techniques from September 17-20, 2018 in Paris. Around 50 exhibitors are expected to attend this fair spread over 1,500 sq. m. that will be held under “The Fairyland for Fashion” banner and bring over 1,850 exhibitors together.
With Leatherworld Paris, Messe Frankfurt France intends to launch equivalent flexible materials such as fake fur - the quality and technical properties of which have improved considerably to the point of providing competition for genuine fur. This inclusion in Leatherworld has generated tremendous response with clothing manufacturers eager to attend the show. Leather and associated materials, especially those used for accessories, or often extensively for clothing, will be grouped here in one area, simplifying searches by prime contractors.
New synthetic materials with a leather effect have appeared in the interior furnishings, automotive and fashion sectors. They offer properties that leather
to date did not provide: waterproof qualities, affordable price, etc. These criteria are now becoming essential in order to respond to the global growth in consumption. A lack of supply and the high cost of genuine leather have driven the demand for imitation leather over the last decades, without forgetting the wish of some ready-to-wear brands to avoid using materials of animal origin, even entirely “fur-free”.
China remains the foremost supplier to France and Germany be it tanneries/taweries, small leather goods, gloves or footwear, which forms the main body of the products at Leatherworld, particularly for fake fur. Ecopel from Shanghai, the major supplier for fake fur and imitation leather, will also attend with its French representative. The Pakistani leather industry will also be represented by two firms with proven skills. Additionally, a range of leather goods from Lebanon in addition to three specialist leather firms from Turkey will also attend the fair.
Messe Frankfurt France will also organise a series of lectures on the latest happenings in the industry. A trends forum and a catwalk show combining leather clothing and accessories will round off this new offering.
The Tirupur knitwear cluster is looking to the Indo-Pacific economic corridor as it would open up traditional apparel markets abroad. The Indo-Pacific economic corridor is a treaty likely to have 12 countries, such as India, the US, Australia, Indonesia, Japan and New Zealand, on board. Under the treaty, each country is expected to provide a conducive climate for trade exchanges for other members and investment to develop infrastructure.
Especially in the apparel market, India could utilise the advantage, if the US, which has a traditional apparel market, has a lower import tariff and a softer approach. Apparel exporters in India could get a huge help from the corridor. The corridor will provide a platform for a select group of nations and it help others develop their economies. If the partners are provided preferred status by other nations, it will be a win-win situation for both sides.
Though the economic corridor has been mainly mooted to counter China, it will not affect China much, at least not in the apparel market. Since Chinese firms have already made big investments in countries such as Bangladesh, Vietnam and Cambodia, which are top competitors of India in the apparel industry, China may not feel the heat of the corridor.
Inditex will start an at-home pick up service in China for recycling garments in September. The recycling program is a part of Inditex’s closing the loop, reuse and recycling initiative started in 2016.
Inditex is a Spanish fashion retailer. So far Inditex has collected over 25,000 tons of garments from 21 markets. The recycled textiles along with the sustainable raw materials were used in manufacturing more than 73.6 million garments for Zara and Massimo Dutti’s Join Life and Oysho’s We are the change collections in 2017.
Moreover, the company plans further development on this project and has coordinated with MIT’s international science and technology initiatives for enhancing the process of recycling of used textiles and creation of new fibers using clean technology. Another step decided by the company is deployment of RFID technology in all its group brands by 2020. The company has already installed these systems in Zara and is now working on Massimo Dutti and Uterque.
The fashion retailer has already invested in technology and logistic upgrades and RFID technology deployment in the last five years. It further plans on integrated stock management in all of its 48 markets including Zara online stores by the end of 2018.
India is likely to delay the imposition of retaliatory tariffs on US goods. Incensed by the American refusal to exempt it from the new tariffs, India had decided in June to raise import tax on some US products from August 4. The US wants to reduce its trade deficit with India. The country’s US export growth has consistently declined till May. It fell from a 21.49 per cent growth rate in January to 19.50 per cent in February, 14.75 per cent in March, 13 per cent in April and 11.38 per cent in May.
India’s share in the US’ total goods imports is two per cent and five per cent in services. In contrast, the US’ share in India’s goods imports is five per cent and 15 per cent in services imports. India is also hopeful of securing exemption from the US regarding steel and aluminium tariffs, which had been imposed earlier by the US against all trade partners.
Tariff hikes raise new trade barriers, make domestic manufacturing more attractive as the steep increases in customs duties make imports unaffordable. For agri products such as pulses, which have witnessed an increase from 30 per cent to 70 per cent, this would provide encouragement in increasing the cultivable area, on the back of good pulse production in recent years in India.
Bangladesh feels by building its image as a green industry in the global market the country’s export earnings can see growth. But the country faces problems of poor awareness on environmental sustainability and inadequate funds. Lack of technical expertise, limited availability of resources, scarcity of land and poor data management at the factory level are other factors.
But efforts toward green initiatives in the readymade garment sector are unstinting. Buyers the world over are attracted to green factories because of their commitment towards the environment. Green industrialization can play a vital role in increasing product diversification, price competitiveness and cost competitiveness.
Since 2011, 67 Bangladesh readymade garment factories have received Leadership in Energy and Environmental Design (LEED) certification from the US Green Building Council (USGBC), one of the top green building rating systems in the world. Out of the 67 factories, 13 have been rated platinum, 20 gold, and five silver. At least 222 more factories have been registered with the USGBC for the LEED certification.
The world is moving toward green industrialization. Green initiatives in the apparel industry attract global brands and retailers. Indonesia has 40 green factories, followed by India with 30 and Sri Lanka with 10. Bangladesh’s readymade garment sector is a $28 billion dollar industry.
The Chairman of Vietnam Textile and Apparel Association, Vu Duc Gaing says, free trade agreements, particularly the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), are attracting big investments in Vietnam’s garment-textile industry. Giang revealed that in the first six months of 2018, Vietnam attracted $2.8 of foreign direct investment (FDI) in garment-textile, bringing the total FDI in the sector to nearly $17.5 billion.
The country also witnessed the launching of several large-scale projects including a German-invested sheep wool yarn spinning plant in the Central Highlands city of Da Lat and an US-invested yarn production plant in the southern province of Dong Nai. Many Vietnamese firms also invested in material production projects. Besides, CPTPP and EVFTA have changed the structure of export markets of Vietnamese garment-textile products in recent years.
