FW
The review committee on garment factory inspection in Bangladesh is waiting for the government’s direction to take action against factories which have failed to conduct detailed engineering assessment of their factory buildings within the stipulated time. Of 49 factories, 14 units are yet to conduct the assessments. The 14 factories are on the inspection lists of the Accord on Fire and Building Safety and Alliance for Bangladesh Worker Safety.
The review committee was formed last year to decide on shutdown of any garment factory due to safety concerns. If the three initiatives find serious faults in any factory, they can suggest the review committee to look into the matter and only the review committee can announce closer of a factory if it finds any safety risk.
In the process, the review committee received recommendation for reviewing 41 buildings where 84 garment factories were located.After review the committee announced closer of 32 factories, while 21 units were partially closed, and 49 were asked to conduct the assessments.
The Department of Inspection for Factories and Establishments has already sent a list of the factories to the labor ministry seeking necessary direction in this connection.
Jeans Care was the first factory where Accord inspection teams found structural faults and sent their report to the review committee for further decision.In the first week of April the review committee asked the authorities of the factory to conduct the DAE within six weeks but the company is yet to do it.
Exports of Vietnamese apparel are expected to touch $24.5 billion thereby surpass the set target by nearly a billion. The garment and textile sector continues to top Vietnamese exports, mainly due to the right strategies. These include: hiking the percentage of locally made raw materials to 50 per cent.
Vietnam exports garments worth $8.85 billion to the US, $2.38 billion to Japan and $1.96 billion to South Korea, all of which put together account for 70 per cent of exports from the sector. Signed and pending free trade agreements are opening up a lot of chances for the sector to grow further, as import tariffs may drop to zero in many markets.
The tax incentives to be ushered in with the signing of Trans-Pacific Partnership Agreement in 2015, will also create favorable conditions for clothing exports to the US market. If TPP deal is inked, it would help Vietnam capture 10 per cent market share from China, as Vietnamese textiles and apparels would then enjoy greater benefits than China, which do not form part of the TPP agreement. Globally Vietnam ranks fifth in textile and apparel exports.
Indian textile associations want some more time to fulfill their export obligations under the export promotion capital goods scheme. Mills say they were not able to fulfill the obligation due to recession for the last six years. So they want time and they say the export obligation should be only six to eight times the duty saved.
India’s share in the international market is 32.9 per cent for cotton yarn, 3.53 per cent for cotton fabric, 11.25 per cent for cotton made-ups and 3.86 per cent for garments. One problem facing the industry is that subsidies under the Technology Upgradation Fund scheme are yet to be refunded. The Associations say the delay has impacted projects. They want the Centre to allocate an additional Rs 3,000 crores for the scheme in the upcoming Budget.
The Indian share in global textile and apparel exports is miniscule due to various levies on manmade fiber made products. The industry wants import duty, special additional duty, and anti-dumping duty to be removed and the central excise duty on manmade fiber to be reduced.
The government stopped extending benefits to the industry from June 2010 to April 2011. One specific request the industry has is that raw material costs, costs of converting raw material to finished goods as well as power tariffs should be less than or equal to global prices.
The next edition of Heimtextil will be held in Germany from January 14 to 17, 2015. This is a trade fair for home and contract textiles. It is a platform for manufacturers, retailers and designers to stock up on their year’s quota of best raw materials at cheapest prices. Leading textile manufacturers from all over the world bring their best materials to this fair. Heimtextil is normally the first trade fair of the year.
The products include bed linen, upholstery, furniture fabric, household decorative covers, garments etc. Four major design trends for this year are: Sensory, Mixology, Discovery and Memory, these will be featured at the show. Sensory trend comprises delicate, clinically cool colors such as Whisper White, Spa Blue and Moonstruck. Mixology is characterized by contrasting dynamics, bright colors and ethnic patterns. Discovery is an attempt to create profound feelings with pronounced fabric structures and colors such as black, purple and silver. Memory stresses on picturesque and romantic images with saturated colors including True Navy and Scarlet Sage.
These textile trends signify a yearning to satisfy one’s desire for well-being and luxury. But they also fulfill the principle that aesthetics and functionality always go hand in hand.
www.eventegg.com/heimtextil/
The UAE has implemented the International System of Units (SI), which replaces imperial measurements such as foot, inch and yard with the metric system.
The new rules come into effect on January 1, 2015. Fabric and textile suppliers and merchants must comply with the new system by using the meter as an unit instead of the yard. The conversion of unit sales used in the textile trade is an important step toward unifying the units of measurement used in the UAE, making these consistent with the SI.
The new system is part of efforts to protect consumers’ rights and ensure better practices as per approved standard specifications in order to stimulate economic growth. The shift follows the UAE’s introduction of the liter instead of the gallon as a unit of measurement for fuel in 2010.
A lot of Arab customers still ask in yards, so it will take some time for people to get used to asking for measurements in meters.
Shop keepers say the change will have a small impact. The difference in size amounts to a 10 per cent loss for them so they have increased the price of some items by five per cent and other items by seven per cent. To fix the problem, they are now buying in meters so they can sell in meters without any losses.
The textile and clothing sector in India wants the government to take interest in the trade agreements proposed with Russia and the European Union and address some of the bottlenecks that the industry faces.
Vietnam and Bangladesh have overtaken India in apparel exports though they do not have manufacturing facilities for the raw materials. Differential taxation for cotton and man made fibers, need for a fiber policy, high energy costs and too many regulations are some of the factors slowing down the country’s textile industry.
Since duty free import of garments is permitted in India from Bangladesh, a lot of Chinese fabric also comes into India through Bangladesh. However, Bangladesh imposes high duties on import of fabric from India. The industry wants the norms to be modified, stipulating use of yarn and fabric of Indian origin as a pre-condition to allow duty free import of garments from Bangladesh.
India’s traditional markets are the European Union, US and Japan. Now the country is looking at newer markets like Brazil and Russia. Brazil imported apparel items worth 2.5 billion dollars in 2013-2014 from India. The industry wants textile items to be included under the existing India-Mercosr preferential trade agreement.
Since the European Union offers zero duty market access to Pakistan, Bangladesh and less developed countries, the industry wants the free trade agreement with the EU to be concluded soon.
Mexico has announced a set of measures aimed at combating unfair trade practices affecting the textile and apparel sector and enhancing the productivity and competitiveness of domestic manufacturers in the face of mounting foreign competition.
This action includes six separate measures involving import duties, importer registration, automatic alerts, enhanced surveillance and minimum estimated prices. In addition, Mexico will establish new financing mechanisms to allow domestic textile and apparel producers to modernize their infrastructure and increase their exports to foreign markets.
Tariff breakouts for textile and apparel products will be expanded from the 8-digit to the 10-digit level. Textile and apparel importers will be required to be listed on a sector-specific registry. This requirement is already in place for certain other sectors, including footwear.
The Mexican government will establish an automatic alert system for textile and apparel imports that will allow customs officials to verify imported goods in advance. Minimum estimated prices will be set for raw materials and finished goods. The import duty reduction on 73 apparel items and seven textile made-ups has been postponed.
A new financing mechanism will enable the textile and apparel sector, especially small- and medium-sized enterprises, to upgrade their machinery and equipment, pursue innovative strategies and develop new products.
Turkey's annual textile exports are up 8 per cent. Germany features as Turkey’s largest export destination followed by neighboring Iraq. Exports to the Middle East were up by 6.2 per cent, with a 61 per cent increase in exports to Syria. Exports to EU countries increased by 9.2 per cent.
Exports to markets with which trade was minimal in the past also showed stronger figures, as sales to Rwanda surged 295 per cent and exports to Suriname increased by 158 per cent. Turkey’s first quarter GDP growth was 4.8 per cent, but it slowed in the second quarter to 2.2 per cent and dropped to 1.7 per cent in the third quarter after the crisis in Iraq and Syria.
The central bank had said it would keep interest rates near zero for a considerable time but signaled in December 2014 that it would raise rates some time next year. Higher US interest rates could spur an outflow of capital from emerging markets, including Turkey, where private sector foreign debt is now at 165.2 billion dollars.
Turkish exporters feel conditions in 2015 can be more challenging, as the US Fed is expected to hike interest rates. The Turkish government has set an export target of 500 billion dollars by 2023.
For Bangladesh’s apparel sector 2014 was an eventful year. Around 400 small and medium-sized factories have been shut following a work order deficit, turning around 10,000 workers unemployed. After the Rana Plaza tragedy, work orders reduced drastically as international buyers pulled out. As a result, many small and medium-sized garment factories had to shut their operation.
Accord and Alliance, the two platforms of the EU and American buyers, completed their inspection at garment factory buildings. The two platforms were formed following the Rana Plaza collapse with a view to inspecting readymade garment units from where they sourced apparels. Alliance has inspected a total of 587 garment factories since 2013 while Accord has so far inspected 1,613 units.
The year 2014 was also remarkable for the apparel industry. The sector which shares a lion’s portion of the export earnings, around 80 per cent, experienced bitter export growth. In addition, the sector failed to meet the export target in the last half of the year 2014 set by the government. Exports of the woven sub-sector during the year showed a shortfall of 10.57 per cent over the target.
Garment exports to one of the major destinations – the US market -- were not as per expected during the year 2014.
Pakistan's garments export posted a robust growth of 10 per cent to US$ 826.836 million in July to November 2014-15, but exporters denied the official statistics. Overall readymade garments export shows a US$ 73.395 million growth in July to November 2014-15, comparing to the apparel export of US$ 753.441 million in July to November 2013-14, according to Pakistan Bureau of Statistics (PBS).
In term of volume, the garments export grew by 1,043,000 dozens (9.09 percent) to 12,540,000 dozens in July to November 2014-15 from 11,497,000 dozens in July to November 2014-15. However the valued added textile exporters rejected the growth projected through official statistics. For instance, according to Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA), there is an ample unsold cotton stock, which shows the value-added textile is not doing well in the absence of proper power and gas supplies to manufacturing units. It also blamed the government saying since Commerce Ministry failed to evolve a plan to help the exporters, they could not capitalise on the GSP Plus status to the EU markets.
According to the industry body, the official figures are not reflecting on the real conditions of the country's export, adding that the growth should have been more than 30 per cent instead of 10 per cent since the country enjoyed the GSP Plus status in one of the world's expensive markets.
"The government has no aim or vision to boost up the export as there has been no new textile policy to help steer the exporting sector to a healthy growth," Khokar added. He said the country's total value-added textile output stands at around 60 percent for want of gas and supplies to manufacturing units, which clearly denies the government's claims projecting a healthy growth of 10 percent.
In November, readymade garments export stood at US$ 169.068 million up by US$ 19.217 million (19.19 per cent) from US$ 149.851 million in November 2013. Volume of garments export also posted an increase of 187, 000 dozens (8.24 per cent) in November 2014 to 2,456,000 dozens from 2,269,000 dozens in November 2013. www.prgmea.org
