FW
"That United States Fashion Industry Association (USFIA) tagline -- dedicated to fashion made possible by global trade, is very pertinent today given the kind of policies being pursued by President Trump. As per the US Trade Commission estimates in 2016 textiles and apparel accounted for 9.7 per cent of imports from China, compared to 39 per cent electronic products. However, the impact on the sector is of huge significance not just in the US but also globally. A recent article titled ‘Walmart, Nike Suppliers Put on Notice by China Tariff Threat’ revealed how Chinese and Hong Kong companies Li & Fung with 64 per cent revenue coming from the US, and electronics company AAC Technologies with 62 per cent were most at risk by Trump’s tariffs. However, the US Trade Representative defends President Trump’s policies while saying he is fulfilling his election promise to push for trade reform to ensure fairer outcomes for US workers and businesses, and more efficient markets for countries around the world."
That United States Fashion Industry Association (USFIA) tagline -- dedicated to fashion made possible by global trade, is very pertinent today given the kind of policies being pursued by President Trump. As per the US Trade Commission estimates in 2016 textiles and apparel accounted for 9.7 per cent of imports from China, compared to 39 per cent electronic products. However, the impact on the sector is of huge significance not just in the US but also globally.
A recent article titled ‘Walmart, Nike Suppliers Put on Notice by China Tariff Threat’ revealed how Chinese and Hong Kong companies Li & Fung with 64 per cent revenue coming from the US, and electronics company AAC Technologies with 62 per cent were most at risk by Trump’s tariffs. However, the US Trade Representative defends President Trump’s policies while saying he is fulfilling his election promise to push for trade reform to ensure fairer outcomes for US workers and businesses, and more efficient markets for countries around the world.
Protectionist policy top business challenge
USFIA’s 2018 Benchmarking Study, based on a survey of 28 executives at leading US fashion companies, cites
protectionist trade policy in the country and the uncertainty it causes at every level from markets to supply chain and retail, as the top most business challenge. Adding to this is the challenge of increasing production and sourcing cost. If production and sourcing is repatriated to the US, it will impact the consumer who may in turn choose to change buying preferences.
Out of the total surveyed, eight out of the top 10 sourcing destinations are in the southern hemisphere. The USFIA survey notes sourcing from the Western Hemisphere is increasing. Free trade agreements in the sector remain underutilised for sourcing. There is slight, though hardly significant, increase in the utilisation of NAFTA, CAFTA-DR and AGOA the main three FTA agreements for the US.
Nearly 77 per cent of the USFIA members supported reduction in documents required for importing and exporting textiles and apparel under FTAs. Administration time and complexity are proving to be a barrier to existing trade policy benefits that the US fashion companies might avail of. Exceptions to the ‘Yarn- forward’ Rules of Origin are a case in point.
Lack of transparency in the rule of origin
The World Bank describes the rule whereby cumulation allows producers to import materials from a specific country or regional group of countries without undermining the origin of the final product. However, the interpretation of this rule is not entirely transparent for example the final assembly of the Apple iPhone takes place in China. Yet the added-value in China is less than 2 per cent (2014 figures) and the applicable US Rule of origin confers origin on China.
Similarly, a T-shirt produced in Bangladesh that imports around 80 per cent of its yarn. The yarn-forward rule then means apparel goods made up in the country often does not necessarily qualify for preferential treatment under FTAs. The outcome is low utilisation of trade preferences for apparel. While a company like the VF Corp may have the resources to untangle such regulations a SME does not, putting them at a competitive disadvantage. The single biggest challenge facing the industry today is uncertainty. It seems, America, like the rest of the world will have to wait and watch.
The Pakistan government has paid Rs 25.7 billion to the textile sector under the first phase of Prime Minister’s Trade Enhancement Package. Out of the total amount, Rs. 2.6 billion was disbursed in first two months during Phase II from July 1 to August 31 2018. The government planned to expand coverage areas under the Trade Enhancement Package to remaining industrial sectors including pharmaceuticals. It would also reduce the cost of doing business in the country.
The Ministry of Commerce and Textile had assured payments through Prime Minister’s Trade Enhancement Package to the textile sector by February 2019 to enhance the country’s exports.The government also relaxed import of textile machinery for modernisation and enhancing the capacity of the sector. It gave priority to facilitating the textile sector and helping it gain competitiveness in order to enhance the country’s exports. It is offering multiple training courses focusing on different areas of textile sector to enhance worker capacity.
Garments, fashion, apparel design, cutting for lingerie making, line supervisory skills and knitting machine operators training are various areas on which capacity building courses are being offered. The main objective of this training program is provision of skilled workforce to make textile industry more competitive. The ministry will cover the costs incurred in the areas of trainee stipend, trainer’s salary, raw material cost, social mobilisation, evaluation cost, certificate printing and distribution.
PVH Corp, which owns the Tommy Hilfiger and Calvin Klein brands, has won an award for corporate excellence for its work in developing the Ethiopian textile value chain. The company has been operating at Ethiopia’s vast Hawassa Industrial Park since 2014, where it is an anchor tenant. The park is expected to create 60,000 jobs within a few years. It features a Zero Liquid Discharge (ZLD) effluent treatment facility which recycles over 90 per cent of the wastewater produced in the park.
The ultimate goal for PVH’s model industrial park is to provide a better future not only for the workers and their families but also to inspire responsible industrialisation across Ethiopia for the betterment of its entire population and the creation of a new market for U.S. goods. PVH has been selected as one of two winners of the 2018 US Secretary of State’s Award for Corporate Excellence (ACE), an achievement recognising US firms that uphold high standards of responsible business conduct.
Established in 1999, the annual Secretary of State Award for Corporate Excellence recognises US companies representing American values in their business practices worldwide and contributing to the growth and sustainable development of the local economies in which they work.
Lenzing has developed a web technology platform. This is a nonwoven web formation process that starts with botanic wood pulp and produces a nonwoven fabric made of 100 per cent continuous Lyocell filament. This web can be integrated with standard non-thermal based nonwoven bonding technologies, such as hydro entangling and needle punching. In addition, the patented technology enables a unique self-bonding mechanism where filaments bond into a fabric during the laydown process. This self-bonding mechanism enables a product range with a much wider variety of surface textures, drapeability and dimensional stability than other nonwoven technologies utilizing 100 per cent cellulosic fibers.
Currently, most nonwoven products are made with plastic materials like polyester or polypropylene, which take hundreds of years to decompose. Coupled with inadequate disposal techniques, the nonwoven industry is a leading contributor to landfill issues globally. With the Lenzing web technology, absorbent nonwoven fabrics with botanic origin will be manufactured using an environmentally responsible production process.
While the nonwoven segment currently making up 30 per cent of Lenzing’s core business, it is committed to driving stronger growth through more active involvement in innovations across the value chain. The nonwoven fabric market is expected to grow at a compound annual rate of 7.5 per cent a year through 2022.
The menswear section of Moda, known as Moda Gent, will relocate to Pure London to join the Pure Man line-up for the February 2019 show. The brand, since its launch in 2016, has grown fast and showcases over 100 menswear brands ranging from formal classics to more on-trend labels, including sportswear and accessories. The addition of the Moda Gent event should support its ongoing expansion.
The earlier sale of Pure London to the ITE Group created plenty of opportunities for consolidation and realignment. The company now aims to present a stronger menswear offering in London and continue Pure London’s long-term strategy to create a unified Festival of Fashion by delivering collaborative solutions to meet buyers needs across all sectors.
Exporters are benefiting from a weak rupee as they get more money while converting their dollar export earnings into Indian currency. Software exporters are expected to be the highest beneficiaries of the declining rupee.
The weak rupee has added to the earnings of the textile industry too. Exporters of apparel, pharmaceuticals, steel, packaging films and software have witnessed a rise in their revenues. It’s like a free money for export oriented software units as almost every contract is in dollar terms and the conversion rate has gone up significantly. The fluctuation in the rupee does not affect offshore clients and hence contracts remain intact at the previously decided terms.
Export oriented units are seeing an average increase of two to seven per cent in their revenues because of the declining rupee. The weak rupee is expected to give a cushion to apparel exporters who were heavily burdened by the sharp rise in the cost of imported raw materials. Apparel exports are expected to do better now. The growth was almost stagnant since the past few years but a weak rupee has brought cheers to many exporters. Their revenues are likely to edge up by over three per cent.
The Institution of Mechanical Engineers an influential UK-based association has called on the textile sector to clean up its act with a new eight-page report that urges government intervention – in partnership with industry – to develop new solutions to problems such as textile microfibre pollution, the creation of excessive waste and the reduction in the carbon footprint of the apparel sector.
The report ‘Engineering Out Fashion’ waste recommends three priority areas for action from the UK government. It specifically calls for public and private investment partnerships to provide incentives for the development of more environmentally friendly fibers. It also urges the government to work with the fashion industry and manufacturers to develop a comprehensive framework to tackle ‘green washing’, or false sustainability claims.
In particular, the institution calls for ‘urgent action’ to tackle the waste produced over the lifecycle of an item of clothing. This includes: addressing water-intensive processes during manufacturing, such as removing excess dyes, and tackling the problem of disposing off a garment at the end of its life. The report highlights garment aftercare affects an item’s carbon footprint and advocates individuals to wash their clothes at a lower temperature, use mesh laundry bags to catch threads, rely on tumble dryers less often or install filters on washing machine waste pipes.
Messe Frankfurt's Parisian textile and apparel sourcing shows, which will be held at the Parc du Bourget from September17-20, 2018, expects 1,850 exhibitors, an increase if 10 per cent compared to the previous edition. The shows will split up the companies and other installations into six distinct spaces, grouped under the slogan "The Fairyland for Fashion."
The main event of the 44th edition of Texworld will launch a new trade show dedicated entirely to leather. Leatherworld, event will bring together 33 – mainly Chinese – companies specialised in the material. The show will be attended by some 1,000 textile exhibitors, mostly from China and India. The national pavilions of Pakistan, Thailand and South Korea will also be joined for the first time by one from Taiwan, while Indonesia returns to the show with eight manufacturers.
Apparel Sourcing will feature almost 700 manufacturers and, for the first time, and feature a section focusing on services, from packaging specialists and software providers to logistics firms and inspection and certification agencies. The trade show will also host some 20 runway shows, as well as 43 conferences and discussions.
Textile Forum, to be held from October 10-11, 2018 at One Marylebone, London, will showcase its broadest range of luxury fabrics to date with many exhibitors emphasising on not just quality of fabrics but also on provenance. A W Hainsworth is using Textile Forum as the launch pad for its new lambswool fabric. Best known for its heavier wools, Hainsworth will offer this new luxurious lighter weight cloth that is ideal for spring / summer garments for women.
First-time exhibitor AnBella Designs, part of Antex Broderie, specialists in Schiffli machine embroidery, will showcase a low minimum order range of limited edition designs. Dormeuil will display its latest collection of luxury cloths made in the UK, as will Linton Tweeds.
Other new exhibitors include Higgs & Higgs, which will display European made cotton prints and jerseys, Jozwiak, wool and wool blend fabrics designed for classic menswear and corporate wear and Weavabel its range of handtags, labels, leather patches and packaging. Besides designers, top end retail fabric buyers are also visitors at Textile Forum. Jane Makower will showcase her most popular core lines, including moss crepe, needlecord, corded lace, transparent tulle and duchess satin.
In the new 70+ page briefing, KPMG notes the $2.5 billion apparel industry is well positioned to implement SDGs within its supply chains to significantly reduce its global environmental impact. Since 2015, four in ten of the world’s largest companies are said to have referenced the Sustainable Development Goals within their corporate reporting, each identifying independent efforts to creating a more circular supply chain.
As with all SDGs, the report highlights the progress different industry organisations and manufacturers have made to improve the sustainability of their supply chains. Regarding gender equality, it cites Gap’s Personal Advancement and Career Enhancement (P.A.C.E) initiative – introduced to empower women working across the sector working in Asia – as an example of progress.
