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Every year, Thailand's BIFF & BIL sees a large number of apparel manufacturers visiting the fair. Yuttana Silpsarnvith, TGMA speaks to Fashionatingworld about the activities conducted by TGMA to promote Thai trade.
What are the highlights of the show?
We had three activities this time. One was the Designer Room, where around 50 new designers showcased their design strength. Second was the AFF conference where six countries were invited to have fashion shows, this is a big conference. Thirdly we showcased the next season’s trends for Thailand. The fair is organized by DITP. TGMA takes care of apparel manufacturers and exhibitors the rest are our members for whom we PR help them connect with buyers.
Do you see more buyers from Japan?
There has been an increase in orders from Japan and ASEAN countries like Singapore and Malaysia.
What was the visitor turnout? Has the number of exhibitors decreased?
Exhibitors have decreased because of Thailand’s political problems. Businessmen, tourists, foreigners do not want to come. For example Hong Kong government had given out a cautionary note saying it is critical, meaning they do not want people to come here.
BIFF & BIL 2014 had 15 per cent less visitors compared to last year. Political problems and demonstrations were the main reasons. But this is better than our forecast which was 20 to 30 per cent less. The first day saw 15 per cent less turnout. Local visitors were less, but there was an increase in foreign visitors, especially suppliers. There were many Japanese customers and this time 12 Japanese brand had booths for the first time. These are brands who want to expand to Thailand and Asia. They said it was successful and next time they will have 20 booths for Japan. Korea too is interested. This year they had eight booths but next year they will come with more textiles and aim to expand here. Japan is a big buyer with textile association, apparel association and fashion association. All combined the figure was more than 300 Japanese.
In terms of business how is Thailand industry doing?
We are talking about relocation of apparel industry especially big and medium size factories. More than 40 companies have shifted from Thailand to Cambodia, Myanmar and Vietnam.
Is it a good or bad sign?
The positive fallout is, we can expand our business because we do not have much human resource, people are getting old for production and we pay higher wages compared to other neighbouring countries so we move out, use cheaper resource and then export. The company remains in Thailand, we keep the R & D material, supply chain in Thailand and then send out and export from there. We have FTA with ASEAN countries. Cambodia, Laos and Myanmar get the GSP from Europe for everything. So there is zero duty to EU and 5 per cent duty to US compared to Thailand. Thailand is about 10 per cent for EU and 30 per cent for US. Being in Cambodia we can take advantage of this.
What is the size of Thai apparel industry?
We export apparels worth $3,000 million and textiles worth $4,600 million. We only source the local consumption and import textile fabric especially functional fabrics. Automotive textile, functional textile for uniform, high performance polyester etc are imported mainly from Korea and Taiwan. We are waiting for Thai-India FTA and awaiting (BIMSTEC) which is FTA together which will happen next year. Thailand falls in Asia and South Asia as well. India is good in cotton, mercerized cotton, yarn dye and we wish to share it for dyeing, fibre.
What kind of growth do you anticipate for Thailand’s textile and apparel industry?
In the next five years, we have to relocate medium and small size quickly. The first two or three years it is the big size that has to move out but in the next five years it is going to be the smaller size factories that will move out. We have to facilitate them.
After relocation, we need to develop trading firms, R&D in Thailand, we need to develop the product and development centre, training centre in Bangkok. So customers will come to Thailand and place orders, develop in Thailand but the production will be done outside. The turnover will come to Thailand as they are Thai owners.
Has Thailand made investments in these countries?
Thailand will invest mainly in CLMV (Cambodia, Laos, Myanmar and Vietnam) for apparel companies. The company invests in CLMV because the customer is in EU. American customers move to Vietnam. Korea also wants to invest more in textile fibres in Thailand as we are good in automotive business. One big company from Japan wants to make automotive textiles here. Korea wants to make a printing company here and another from Japan wants to start a dyeing mill.
How is your business with China?
Not so good. We dropped 6 to 8 per cent in import and export. We tried to increase the number of exports with China for two years but were not successful because of border trade between Laos, Myanmar and with Thai connecting to South China they grow very fast. They may go to Thailand without showing the number of imports. It’s a grey market and this number is increasing from China to all these countries especially to Thailand.
Could you tell us about the changes taking place in global sourcing?
Sourcing is going to get complicated because of FTAs between countries. Canada and Australian customers are now coming back to Thailand. They are moving out from India and China as China is not cheap. Many new customers are starting to find new sources.
Countries like India, Thailand, Japan, Korea, ASEAN should collaborate and get stronger. ASEAN part plus three is China, Japan, Korea and other three is Australia, New Zealand and India. The talks are on for general business with FTA and dilation of bigger group and countries. Asia will become big once FTA is in place. It is global trend we have to compete with America and EU finally.
What are the other activities of TGMA?
We arranged the AFF conference, hosted AFF and arranged six seminars, four workshops in the FTPC board. Business matching is also done. Independently we have trade missions. This year we have four country trade missions to Japan, Korea, Indonesia and Philippines. The objective is to sell Thailand’s products and boost production. Our team is present in Interstoff and we have seminars almost every two weeks in our office.
What are your plans for next BIFF & BIL?
We will try to make BIFF & BIL more interesting. Thailand’s image is not good right now, we want to improve that first.
Interstoff Asia Essential Spring-2014, a leading trade event for cutting-edge fabrics was held from March 19 to 21, 2014 at the Hong Kong Convention and Exhibition Centre. Over 220 exhibitors showcased a broader range of fashionable, functional and eco fabrics and garment accessories at the event this year.
The four well-received country and region pavilions from China, Japan, Korea and Taiwan were present once again, while the first two increased in size by 13 per cent in total. Wilmet Shea Deputy General, Messe Frankfurt (Shanghai) revealed that there were 221 exhibitors this year compared to 229 in the last summer show and 175 in the September show. Shea said, “The visitor turnout on the first day was 1,800 which included China, Japan, Korea, Australia, Hong Kong and Taiwan though overall number of buyers during three day event expected was over 7,000. There VIP delegations from China, Saudi Arabia among other locations also graced the event with their presence.” Moreover, the Accessories Zone saw a larger presence with new exhibitors offering visitors a wider selection of products.
Showcasing upcoming trends
The fair provided meaningful insights into upcoming fashion trends and advanced technologies apart from the latest fabrics and blends. The Fabrics to Fashion Walk had a series of fashion parades featuring nine up-and-coming designers from Hong Kong, Macau and Taiwan this year.
Another first was ‘Spotlight on Hong Kong’, the first catwalk show, featuring Hong Kong designers and brands, including Binar by Erik Cheung, Kenax Leung, Losting by Ostin Lo, SKETCHΔROUND and WH. The second fashion parade ‘Snapshot of Macau and Taiwan’ displayed creative works from Estawom, L.A.C.Y. and Worker Playground came to life under the spotlight, co-organized by the Macau Productivity and Technology Transfer Centre and the Taiwan Textile Federation. MODÈLE de PRUDENCE featured alone in the third parade: ‘Harmony & Conflict by MODÈLE de PRUDENCE’.
Hong Kong, the fashion hub
One of the main highlights of the event was the announcement by Felix Chung, Member of Legislative Committee during the dinner session that John Tsang, Chief Financial Officer with government of Hong Kong had approved the presentations made by Cheng on promoting Hong Kong as a fashion hub and boosting fashion in the city.
Seminars on latest trends
The event also held ‘Design and Trends’ seminars by well-known experts and leading trend forecasters. The seminars covered megatrends, men’s and women’s wear trends, and fashion trend applications in the Mainland China market. Speakers at the Innovation Technology seminars were fibre suppliers, such as Lenzing Fibers (Hong Kong) and Bayer Material Science, and shared their practical experience with the audience. Integration of the most advanced technologies into textiles was seen at the Research and Education Zone, where special displays and fabric samples were displayed. Further, the Designers’ Studio featuring award winning outfits from the EcoChic Design Awards, sponsored by Redress demonstrated how to minimize waste in fashion designs. It also featured innovative garments from Lenzing Fibres (Hong Kong), 12 outfits designed by six Hong Kong designers/brands that were featured in the Fabrics to Fashion Walk. The Research and Education Zone at the event was joined by a new partner this year. The Taiwan Textile Research Institute (TTRI) displayed latest technologies on research and development for textiles.
Trend Forums: Spring/Summer 2015 trends
The Trend Forum was back with a new format featuring a fashion showcase and parade for the first time. Designed by the Directions Trend Committee comprising of four leading trend forecasters from New York, Milan, Paris and Tokyo, the Forum gave participants a better understanding of the trends that would be popular next season by utilizing fabrics sponsored by exhibitors.
Several Chinese textiles and apparel companies are looking at opportunities to set up offshore manufacturing zones in Sri Lanka under the proposed Sri Lanka - China Free Trade Agreement. Conference and Exhibition Management Services, Global Operations Group Director, S S Sarwar said that with increasing competition, Sri Lanka industries can expand their share in the global market and at the same time attract more foreign investment for highly potential industries, specially the garments and textile industry.
Garment factories in Bangladesh are managed by Sri Lankan middle and senior management staff. Sri Lankan apparel exports surpassed $4 billion and it is expected to increase further. The total number of garment factories in Sri Lanka is estimated to be around 450. Even though Sri Lanka’s apparel industry is small in size compared to Africa and Bangladesh. Sri Lanka’s close proximity to major trade routes and the hassle free Colombo port will immensely help to take the industry to next level.
As per Sarwar, Sri Lankan garment factories are following environmental friendly employment practices and are operated in good working conditions compared to their counterparts in the region. Sri Lanka is the world’s largest exporter of women’s lingerie is also blessed with high calibre resource people. However, the industry needs latest technology and other resources to stay up-to-date with the quality of competitors existing worldwide. Sri Lanka has the potential to expand their share in markets overseas while attracting more foreign investment in the highly potential garments and textile industry with the ever-increasing competition in the world market.
Sarwar expects the textile and apparel sector to immensely benefit through Sri Lanka-China Free Trade agreement to be signed in the near future.
www.cemsonline.com
Bangladesh's commerce minister Tofail Ahmed, says the government has decided to provide cash incentive at the rate of 0.25 per cent to the readymade garment (RMG) industry to overcome the fallout of Rana Plaza collapse and Tazreen Fashion fire. The government has also decided to reduce tax at source to 0.3 per cent from the existing 0.8 per cent. In case of new products and market explorations, the cash incentive has been enhanced to 3 per cent up from 2 per cent which will help the RMG sector save at least Tk 11.00 billion.
Emphasising on the need for developing garment villages in the future, he added that the process of setting up a garment village in Chittagong at the earliest possible time will commence soon and China has agreed to provide soft loans to set up the garment village.
He also informed that the contribution of RMG sector is $22 billion dollars in the overall export earnings of $30 billion in the country. Export earnings from the RMG sector would stand at $30 by 2015. The sector is expected to fetch as much as $50 billion from export of readymade garments by 2021.
www.bgmea.com.bd
As per China's Ministry of Industry and Information Technology (MIIT) report, China's textile industry will maintain steady growth in the year 2014. The report added that a series of fine-tuning of policy measures gradually turned up the growth rate of industrial production in the second half of 2013.
Business conditions have improved and there is a significant increase in market confidence, due to steady rise in industrial economy development, which has laid a good foundation for stable and healthy development of the national economy. However, the production of textile industry was sluggish in 2013. From January to November 2013, China’s textile sector grew by 8.5 per cent year-on-year. The production of yarn, fabric and apparel increased by 8.3 per cent, 5.6 per cent and 0.7 per cent, respectively, which were all lower than the increases in production, registered in 2012.
However, textile export growth was stable. In the first 11 months of 2013, textile industry exports grew by 7.2 per cent, which was about 4.7 per cent higher than the growth rate observed last year. In the first, second and third quarters, China’s textile exports increased by 6.3 percent, 8.5 percent and 6.1 percent, respectively, followed by an increase of 5.9 percent and 8.1 percent in October and November 2013.
A year ago, the European Union (EU) had imposed tariff on US-made high-end women's denim jeans, which is likely to be slashed now. The hike imposed by the European Commission from May 1 2013 saw tariffs on women's or girls' cotton denim trousers jump from the usual 12 per cent duty to 38 per cent - an additional 26 per cent.
But now EU has decided to cut down the additional tariff to just 0.35 per cent, according to international trade law firm Sandler, Travis & Rosenberg. If approved, the change could take effect at the beginning of May, it states. The tariff hike was authorised by the World Trade Organization (WTO) in retaliation against the US's continued distribution of antidumping duties collected on foreign-made goods to affected US producers.
The US law prescribing that system (the Continued Dumping and Subsidy Offset Act, more familiarly known as the Byrd Amendment) was repealed years ago, but duties already collected are still being handed out as requisite legal or administrative procedures are concluded. Sandler, Travis & Rosenberg has been actively working to obtain relief for affected US manufacturers.
www.strtrade.com
Coteminas, the biggest vertically integrated textile group in Brazil, Latin America plans to explore Turkey as its next ideal location for investment due to its large domestic market and export potential. Coteminas, with a cutting edge technology in each of its 22 factories, produces threads, fabrics, knits, bed linen towels, T-shirts, socks, and bathrobes. It is also responsible for approximately 20 per cent of Brazil’s cotton consumption.
Brazilian companies are increasingly finding that Turkey’s business and investment environment is suitable location in Europe due to its geography and growing economy. Also, Turkey is located close to the EU, which is already showing signs of recovery after the eurozone crisis.
Also the textile major feel Turkey would be its first choice given the growth potential and central status providing easy access to the European, Middle Eastern and African markets and make the country the ideal choice for an investment. Coteminas President recently met with the head of Turkish Textile Employers' Association (TTSIS). According to him, Turkey and Brazil could do more to improve their business and trade relations. The two countries have a combined population of 300 million people and a $3 trillion GDP. Both countries have the advantage of having large domestic markets.
Turkey is fast becoming recognized as a fashion center and top clothing supplier. The country has over 35,000 textile and clothing companies and is the fourth largest supplier of clothing in the world and ranks among the top ten exporters in the textile industry. Turkey has also been able to maintain its edge in the industry by investing early in cutting-edge technologies.
www.coteminas.com.br
After two decades of lull in the Australian wool industry due to collapse of the reserve price scheme, it is suddenly witnessing an upturn as global fashion companies are focusing their attention to natural fibre- wool. For instance, recently internationally renowned L'Uomo Vogue from Italy teamed with The Woolmark Company to display Australian wool and fashion during a week-long celebration.
As a part of the celebration, Sydney's CBD shopping zone will pay homage to wool and fashion, with store windows including David Jones displaying photographs from L’Uomo Vogue archives. And the exclusive photographic exhibition ‘An Artful Thread between Fashion and Style’ will show at the Museum of Contemporary Art.
The Italian men’s magazine has also dedicated its entire March edition to Australia featuring its heritage, including woolgrowers with award-winning actor Cate Blanchett on the cover. Bugaboo, the Dutch baby brand has also started marketing 100 per cent Australian wool accessories, including pram linings and baby blankets made of wool.
Other initiatives like different marketing campaigns including the HRH The Prince of Wales Campaign for Wool and International Woolmark Prize have been promoting wool bringing it back into the spotlight. In fact over the past six months at least 10 countries including Russia, Japan, India and China visited Australia to see the wool growing process. Vietnamese manufacturers and processors would now be visiting Australia as a part of their wool-buying mission.
www.woolmark.com
As a part of its restructuring process, Bombay Rayon Fashions has declared a lock-out at its mill division located at Dodaballapur, Bangalore. The company had also announced that pursuant to the Clause V of the company's code of conduct for prevention of Insider Trading, the trading window of the company would remain closed up to March 20, 2014.
Net loss of Bombay Rayon Fashions stood at Rs 21.47 crores in the quarter ended December 2013 as against net profit of Rs 47.20 crores during the previous quarter ended December 2012. Sales rose 0.51 per cent to Rs 822.92 crores in the quarter as against Rs 818.74 crores during the previous quarter ended December 2012.
In the second quarter, company reported a net loss of Rs 104.85 crores against the net profit of Rs 43.58 crores in the corresponding quarter of previous fiscal. The loss, however, narrowed significantly from Rs 411.75 crores reported in the preceding quarter ended June 30, 2013.
Losses at the company's wholly owned subsidiary BRFL Italia Srl, Italy, had also hit the bottom-line of the company. Due to economic slowdown in Europe and rising costs, BRFL Italia has been shutting down its loss making stores and is in the process of rationalizing the business.
www.bombayrayon.com
Rana Plaza workers, will get Tk 50,000 each as compensation, to be disbursed by the Rana Plaza Donor's Trust Fund by mid-April. The UK-based retailers have now agreed to compensate the tragedy victims through the Rana Plaza Compensation Coordination Committee.
The coordination committee includes representatives of the Bangladesh government, local industry, global brands and retailers, and Bangladeshi and international trade unions and non-governmental organisations (NGOs). The UN agency - International Labour Organisation (ILO) - acts as a neutral chair of the body. The Trust Fund was formed to compensate the victims of the building collapse that killed more than 1,100 workers in April last year.
Recently, UK-based retailer Primark announced its plans to contribute and compensate the 580 workers of New Wave Bottoms during April-May through the coordination committee, which was housed in the Rana Plaza building. Among the 580 workers, 200 are deceased workers' families or their dependents, including the 47 missing, while 227 are injured. They will get compensation according to the ILO convention.
Primark will distribute $9 million among the 580 workers of New Wave, apart from contributing $1 million to the Trust Fund for workers, who worked in four other garment factories. Processing of compensation claims for the Rana Plaza victims will start from March 24.
www.ranaplaza-arrangement.org
