FW
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
It was a turbulent year 2014 for Asia’s textile industry: soaring labor wages in China, violent workers’ protests in Cambodia and collapsing factories in Bangladesh.
China has already lost its appeal as a cheap garment producing country and foreign apparel retailers have turned to factories in Bangladesh and Cambodia in recent years. But workers in these cheap garment producing countries are also increasingly agitating for better pay.
Many textile retailers already have begun sourcing clothes from Ethiopia. Foreign textile investors benefit from an abundance of cheap labor, cheap energy and locally produced cotton. In neighboring Kenya, the textile industry is also expanding. The government is trying there to lure manufacturers with generous incentives.
East African countries have the potential to become a serious alternative to East Asia in terms of textile manufacturing. Apart from lower labor costs, it is quicker and cheaper to ship textile products from Africa to the main markets in Europe and the US, rather than from more distant countries in the Far East.
African countries also have duty-free access to the US textile market under a special trade agreement signed in 2000. And by utilising and expanding native cotton production, producers can avoid expensive imports by using local materials.
BGMEA and a Chinese company will jointly carry out feasibility study and environmental impact assessment on establishment of the proposed garment industrial park at Baushia of Gazaria in Munshiganj, to accommodate the non-compliant units.
Orient International Holding Company (OIH) will finance the expenditure, while Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will provide the necessary technical support to conduct both the study and the assessment by April to develop the park.
The feasibility study will scrutinize all the related issues, including total cost of developing the park, financing procedures, repaying and duration of fund, developing the park - either in the form of plots or buildings and their number, expected employment generation, and time for relocating the factories and its procedures. The environmental impact assessment will include management of industrial waste materials, and their impact.
The feasibility study will also decide how long OIH will operate the park, when it will hand over its authority to BGMEA, and how it will be done, sources said. The proposed garment park also included establishing a 300-MW power plant, central effluent treatment plants, container terminals, and dumping yards. The study will fix how these things will be set up as well as their capacity and operation, they said. www.bgmea.com.bd
The Dhaka Apparel Summit was held December 7 to 9, 2014.Eighty-five speakers from Bangladesh, the European Union, the USA and other countries shared their views at nine sessions at the summit. Nearly 25 of the speakers were top officials of different western retailers and brands.
Among the participants were brands, fashion designers, sourcing executives, workers’ representatives, civil society organisations, buyers and academics. Among the issues discussed were road communication, environmental sustainability, workplace safety and sustainable production, responsible sourcing and productivity enhancement, and workplace tranquility.
Bangladesh has a target of earning 50 billion dollars from garment exports by 2021 and the summit debated ways on achieving that.
Around 6,000 people took part in the summit and around 15,000 visited the expo on fire fighting equipment, which was held on the sidelines of the summit. Local and foreign firms showcased fire fighting equipment at 92 stalls.
Bangladesh plans to build a knitwear village. The government will allocate 1,000 acres of land for the new project. The government has already allocated 482 acres for a woven garment makers’ project. A Chinese firm is collaborating on this project. A center of excellence will also be launched for the country’s apparel industry. This will support member companies in their skill development programs and will guide them in giving market-responsive training.
bangladeshrmg2021.com/apparel-summit/
Vietnam's garment and textile export sector anticipates a good year ahead mainly because of the imminent free trade agreements. One is the agreement with the European Union, which will cut the tariff rate from the current 12 per cent to zero. Another is the Trans-Pacific Partnership, which would also bring in opportunities for the garment and textile companies to expand markets, especially in the US.
The current tax rates imposed on Vietnamese garment and textile products exported to the US are approximately 17 to 18 per cent. The signing of the TPP would cause the tariff to be cut gradually to zero. Also expected is a free trade agreement with Russia. As a result the garment and textile export industry anticipates a good year in 2015 and feels the export turnover could possibly exceed $24.5 billion.
The impending free trade agreements have helped attract importers, who want to take advantage of the agreements, to transfer orders from other countries to Vietnam. However, Vietnamese firms need to enhance their competitiveness to improve their position in the global garment and textile value chain. They also need to improve their quality to meet the requirements of import countries and to adhere to the guidelines set by the agreements.
