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Chinese companies are exploring investment opportunities in Kazakhstan. Their area of interest include: cotton production, raw material processing, clothing production, and logistics.
Kazakhstan and China have a border connected by mountains and rivers. In Kazakhstan, about 2,50,000 tons of cotton are collected annually. About a third of this is processed and the remaining goes as raw materials for export.
Seeking to attract more foreign investment from its prime position in China’s huge Belt and Road trade project, Kazakhstan has launched a new financial hub. The Astana International Financial Centre (AIFC), a self-styled mid-shore special economic zone, hopes to attract players ranging from Chinese state funds to Swiss private banks by offering tax breaks, easy entry and a Common Law court.
The move is part of Kazakhstan’s ambition to become a Luxembourg-style intermediary between larger nations and a gateway for foreign investment across Central Asia. Modeled on the Dubai International Financial Centre, AIFC wants to host all sorts of market players: family offices, private banks, brokers, asset managers, Islamic finance institutions and fintech companies.
Unlike DIFC, though, AIFC will not require that its members maintain a physical presence in the windswept Kazakh capital. It will also charge much lower fees than the established hubs and offer 50-year tax breaks.
Bangladesh’s export earnings in July were 21.72 per cent higher than in the the same period last year. Knitwear exports grew by 20.88 per cent and woven exports grew by 22.59 per cent. In the last fiscal, apparel sector contributed 83.49 per cent to the country’s total exports. Bangladesh’s export earnings from the apparel sector registered 8.76 per cent growth.
Eid vacations in June hindered production and shipment of goods. The pending shipments were sent out in July, which pushed export earnings up sharply. Improvements in safety standards and workers’ rights have raised buyers’ confidence in Bangladesh’s readymade garment sector, which is a contributing factor to the growth in exports.
Bangladesh has plenty of opportunities in the global export market. The duty on Chinese imports imposed by India and the trade war between China and the US may both help exports from Bangladesh.
Bangladesh’s overall export earnings rose 5.8 per cent in fiscal ’17 as compared to fiscal ’16. In August 2015, export earnings from the readymade garment sector grew by 32.45 per cent. However, the impending new wage structure and prices of gas may pose challenges in maintaining the growth rate in future.
North America's leading fashion marketplace Magic, held recently in Las Vegas featuring 17 Istanbul designers, manufacturers and brands, demonstrated Istanbul’s growing status as a global fashion capital. Organised by UBM Fashion and featuring all major international fashion brands, Magic is a four-day event held at the Mandalay Bay and Las Vegas Convention Centers. The event exhibits a range of women’s wear, menswear, fabrics, accessories, and footwear.
Turkey, Europe's largest textile producer, has long been a leader in the production of fashion textiles, owing to the industry's talented workforce and historical expertise. In recent years, the country has become a manufacturing powerhouse for the global fashion industry, with major brands including Hugo Boss and Balmain leveraging Turkey's 'best of both' blend of fair pricing and quality production.
Turkish participation at Magic is a part of the increasing demonstration of Turkish creativity and innovation in design at key international events. The event is co-organised by the Istanbul Textiles and Apparel Exporters' Association (İHKİB), an industry group with more than 10,000-member exporters.
ICI Pakistan will market Huntsman’s textile dyes, chemicals, digital inks, and services in Pakistan. ICI Pakistan is a specialty chemicals company. The collaboration will combine Huntsman Textile Effects’ global experience in downstream marketing, product innovation, and product stewardship with ICI Pakistan’s extensive and well established local network of customers and suppliers. The combine will help customers in Pakistan produce higher-value products from a cleaner and more modern supply chain.
Huntsman and ICI Pakistan aims to deliver enduring value for the textile sector by supporting local companies capture global emerging opportunities. Huntsman Textile Effects is a leading provider of high quality dyes and chemicals to the textile and related industries. The company has operations in more than 90 countries and six primary manufacturing facilities in six countries (China, Germany, India, Indonesia, Mexico and Thailand). It develops solutions and innovative products with intelligent effects, such as durable water repellents, color fastness, sun protection or state-of-the-art dyes which reduce water and energy consumption. It is a publicly traded manufacturer and marketer of differentiated chemicals. The company’s chemical products are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. Huntsman operates more than 75 manufacturing and R&D facilities in approximately 30 countries.
For the three month period ended June 30, 2018, Grasim’s net sales were Rs 17,089.65 crores as compared to Rs 11,222.17 crores during the three month period ended June 30, 2017. Net profit was Rs 1,399.51 crores, as against Rs 1,248.10 crores for the three month period ended June 30, 2017.
Grasim, a part of Aditya Birla, is the world’s fourth largest pulp producer. It is one of India’s largest viscose staple fiber producers and is expanding capacity by 2.4 times. Grasim has ensured control over 80 per cent of the costs through backward integration, giving it an important competitive advantage over nonintegrated players. Its manufacturing input of caustic soda, power and steam and carbon disulfide is fully captive and the company has control over 60 per cent of the pulp requirements.
After the successful introduction of its fabric brand Liva in 2015 in the Indian market, Grasim is planning to take the brand abroad. Indonesia will be next stop, followed by Turkey.
Net sales of Nandan Denim in the three month ended June 30, 2018, was Rs 359.62 crores as compared to Rs 424.44 crores during in the same period in 2017. Net profit was Rs 5.23 crores for as against Rs 16.31 crores for the three month period ended June 30, 2017.
Nandan Denim is India’s largest denim fabric manufacturer. From a year-on-year perspective, Nandan completed capacity expansions at the denim fabric, shirting fabric, and yarn manufacturing units. The company’s fabric manufacturing capacity is 110 million meters per annum. Going forward, emphasis will be laid on fashion denim fabrics to target better realizations compared to regular denim material.
A combination of higher sales volumes and value added products is likely to fuel top-line growth in the coming fiscals. Denim fabric contributes 80 to 90 per cent to Nandan’s annual turnover. Nandan is gradually steering the business towards the value added denim category. A new yarn dyeing plant has been commissioned to meet input requirements of the shirting fabric department.
In the midst of the US-China trade dispute, Chinese companies will participate in Canada’s largest apparel and textile trade show, Apparel Textile Sourcing Canada (ATSC) to will be held from August 20-22, 2018 in Toronto. The show, featuring over 500 international exhibits, will include three days of seminars and panels, an on-site business matchmaking service and a spectacular fashion show spotlighting established and up-and-coming Canadian designers.
More than 5,000 visitors are expected to attend over the three-day event – now in its third year – including apparel and fashion executives, influencers, designers, retailers, importers, wholesalers, merchandisers, buyers and suppliers. ATSC is being supported by many international governments and associations, headed by the China Chamber of Commerce for Import and Export of Textile and Apparel (CCCT) and the Bangladesh High Commission on behalf of the Export Promotion Bureau and the Bangladesh Garment and Manufacturers Export Association.
The event is also being supported by the Taiwan Textile Association, the Federation of Indian Chambers of Commerce and Industry (FICCI), India’s Apparel Export Promotion Council (AEPC) and TFO Canada, experts in trade for developing countries.
Bangladesh targets a 6.33 per cent rise in readymade garment exports for fiscal 2018-19. Apparel occupies 83.79 per cent of the total exports. The target for knitwear is a rise of 7.21 per cent and woven growth target too is 7.21 per cent.
Cash incentive for garment exporters has been hiked to four per cent. With the higher cash incentives, garment exports to some new destinations like India, China, Japan and Australia are expected to grow a lot this year.
Bangladesh has had an impressive run in 2017-18 fiscal, making great strides in increasing garment exports. During the fiscal, apparel exporters marked a 8.76 per cent gain on a year-to-year basis – which is indeed encouraging in a competitive market where prices of apparel are falling.
Bangladesh targets readymade garment exports worth $50 billion by 2021. Buyer confidence in Bangladesh improved due to improvement in safety standards. However, manufacturers want a business friendly environment. They feel Bangladesh should focus on product diversification and go beyond the apparel sector and identify five sectors which would be able to earn over a billion dollars in the next five years. Bangladesh’s export earnings from readymade garment sector in the last fiscal year grew 8.76 per cent.
Ashapura Intimates’ Q1 net sales was, Rs 73.43 crores as compared to Rs 64.11 crores during the three month period ended June 30, 2017. Net profit stood at Rs 4.60 crores for the three month period ended June 30, 2018, as against Rs 3.99 crores for the three month period ended June 30, 2017.
Ashapura Intimates Fashion incorporated in 2006, is a fashion house that designs, brands, markets and retails intimate garments for men, women and children. The company is in the business of designing, branding, marketing and retailing clothing products such as lounge wear, sleep wear, bridal night wear, honeymoon sets, bathrobes, women’s inner wear, sportswear and kids’ lounge wear under the brand name Valentine.
Products across categories such as nighties, maternity feeding nighties and bridal night wear are marketed under the brand Night & Day. Their brand Valentine offers clothing that is comfortable, stylish and classy. The Valentine sportswear range is in 15 EBOs across India. The company plans to foray into the kids’ wear segment in the coming years.
"The industry attributes growth to expanding winter season in the western hemisphere as well as technological upgrades in manufacturing sweaters. Additionally, favourable conditions such as political stability and low cost funds are aiding the growth of sweater exports. In fact, industry leaders opine export growth could be even greater if there is enough logistical support at ports and in the transportation sector. They also hoped exports earnings will contribute $8 billion annually by 2021, if the government provides proper infrastructure and policy support."
Data from the Bangladesh Export Promotion Bureau (EPB), for the fiscal 2017-18, reveals the country earned $3.67 billion in exports, which is 9.32 per cent higher than the $3.36 billion it earned in FY16-17. The country’s export earnings from sweater products grew 9 per cent to $3.67 billion in the last fiscal year. Sweaters contributed nearly 12 per cent to the total RMG exports of $30.61 billion of FY17-18.
Growth drivers
The industry attributes growth to expanding winter season in the western hemisphere as well as technological upgrades in manufacturing sweaters. Additionally, favourable conditions such as political stability and low cost funds are aiding the growth of sweater exports. In fact, industry leaders opine export growth could be even greater if there is enough logistical support at ports and in the transportation sector. They also hoped exports earnings will contribute $8 billion annually by 2021, if the government provides proper infrastructure and policy support.
The second growth driver, according to the BGMEA is upgrading of manufacturing machines from manual to
automatic. This has not only increased production capacity but also boosted worker productivity. Global climate change has also impacted Bangladesh with the winter season in the western hemisphere expanding beyond its normal period. This has increased demand for winter clothing.
Shift in focus
Rising worker wages in China has led to manufacturers shifting their businesses to include higher-end products whereas buyers are searching for new sourcing destinations. Bangladesh offers a quality product at reasonable prices, this in turn, creates an opportunity for the country’s manufacturers.
Manufacturers say, global buyers are offering lower prices for their products, whereas the cost of production has gone up. To meet global demand, therefore they have to invest in automation, pushing production cost further up. However, the price of sweaters has not increased; rather, buyers have further reduced the prices of finished goods.
In order to grab a larger market share, Bangladesh has to increase port capacity to reduce lead-time. Inefficiency of infrastructure is another impediment that the country needs to be addressed. Bangladesh is unparalleled in product quality, so there is room to grow in the global market. However, there are challenges, including the lack of raw materials to produce high-end goods, technical expertise, and latest technology. Only about 60 per cent workers here can make higher-end products.
A stable and long-term policy, which would provide all out facilities to create a business friendly atmosphere, can pave the way to remove obstacles that stand in the way of new investments. The policy should be comprehensive and unified in order to ensure a level playing field for all.
