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The global economic outlook, as projected by the Organization for Economic Cooperation and Development (OECD), looks challenging. Ongoing wars, coupled with rising inflation and high interest rates, are anticipated to lead to a decline in global economic growth from 2.9 per cent this year to 2.7 per cent in 2024.
Two of the world's largest economies, the US and China, are expected to experience stagnation in growth next year, with rates dropping from 2.4 per cent in 2023 to 1.5 per cent. The OECD also foresees a decrease in US inflation rates from 3.9 per cent in the current year to 2.8 per cent in 2024 and further down to 2.2 per cent in 2025.
China's economic growth is projected to slow down from 5.2 per cent in 2023 to 4.7 per cent in 2024. Factors contributing to this decline include China's real estate crisis, rising unemployment, and a slowdown in exports. Consumer consumption in China is expected to decrease due to rising unemployment levels and increased uncertainty, leading to a decline in discretionary purchases.
In the Eurozone, consisting of 20 countries sharing the euro currency, collective growth is predicted to marginally increase to 0.9 per cent in the coming year from 0.6 per cent in the current year. The region's growth will be influenced by factors such as rising energy prices and surging interest rates. These challenges collectively contribute to a complex economic landscape with potential implications for various regions and sectors.
PVH Corp, the owner of renowned brands Tommy Hilfiger and Calvin Klein, has revised its earnings outlook for the full year following a robust third quarter performance, where revenues experienced a notable 4 per cent surge, reaching $2.363 billion. Based in New York, the company now anticipates an increase in earnings per share (EPS) to around $9.75, up from the previous estimate of approximately $9.60. The full-year revenue projection has been adjusted to a roughly 1 per cent increase, deviating from the earlier forecast of 3 to 4 per cent growth in the last fiscal year.
In Q3, Tommy Hilfiger's revenues saw 4 per cent rise, driven by a 3 per cent increase in international sales and a substantial 6 per cent growth in North America sales. Likewise, Calvin Klein experienced a 6 per cent revenue boost, propelled by a remarkable 10 per cent surge in international sales. However, Heritage Brands faced an 11 per cent decline in revenues compared to the same period in the previous year.
The company observed an 8 per cent uptick in revenues from direct-to-consumer channels, attributed to a surge in revenues from both owned and operated stores and digital commerce businesses across all regions. The total digital revenue of the company saw a significant 13 per cent increase.
While PVH's wholesale revenues in Q3 registered a modest 1 per cent increase, the net income demonstrated remarkable growth, reaching $161.6 million, a noteworthy turnaround from the net loss of $186.7 million in the same period of the prior year. This positive performance underscores PVH Corp's resilience and strategic adaptability in a dynamic market landscape.
A recent survey led by Jung Ha-Brookshire, Chairperson of the Department of Textile and Apparel at the University of Missouri, suggests companies could derive greater benefits by emphasizing sustainability and ethical practices. The survey, which targeted both employees and customers of Nike and H&M—two prominent clothing brands in the US —revealed many successful companies face challenges in making their customers aware of their social initiatives, despite their employees understanding the broader societal impact.
The study implies companies should strive to enhance awareness among potential consumers regarding their community projects. Ha-Brookshire emphasizes that corporate social responsibility holds particular significance for clothing brands seeking to expand their consumer base. The findings of this research have been published in the journal Fashion and Textiles, conducted in collaboration with Kyung Hee University, South Korea, and Texas Tech University.
Facing a backlash due to wage protests within the industry, Bangladesh apparel owners, specifically BGMEA and BKMEA members, have issued directives to exporters to halt new worker recruitment. This decision comes in the aftermath of over two weeks worker protests demanding wage increase.
Faruque Hassan, President of BGMEA, instructed members to regularly update the biometric database of workers. This is aimed at facilitating various financial benefits, job control, and preventing irregular migration. BGMEA had already announced a suspension of fresh recruitment on November 9, posting a 'no-vacancy' notice at the main factory gate.
Similarly, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), through a circular dated November 12, directed members to suspend fresh recruitment and avoid sharing any information without prior approval. AKM Salim Osman, President of BKMEA, also mandates members to collect all personal information of workers from the labor database and ensure regular updates.
Since October 23, the Bangladesh apparel sector was grappling with two-week-long wave of wage protests, driven by demand for an increased pay scale of Tk 23,000, rejecting the owners' proposed figure of Tk 10,400. The government finalized the minimum apparel wage at Tk 12,500 on November 12, and with the prime minister urging workers to return to work, the labor situation has gradually started returning to normal.
Amidst the protests, unfortunate incidents occurred, with at least four garment workers losing their lives, hundreds sustaining injuries, and thousands facing legal implications. The unrest led to the arrest and imprisonment of a hundred individuals in connection with the violence.
A new report ‘Denim Jeans-Global Strategic Business Report’ by ResearchAndMarkets states, global denim jeans market will grow at a CAGR of 6.3 per cent from 2022-2030.
Currently worth $70 million, the market will reach $114.6 million by 2030. Most of this growth will be dominated by online sales that increase at 12 per cent during the analysis period. The offline channel, on the other hand, will grow by a 4.2 per cent CAGR to reach $77 million.
The growth in the global denim jeans market during the analysis period will be dominated by China that will grow at a 8.9 per cent CAGR to $25.9 per cent in 2030. Japan is forecasted to grow at 3.4 per cent while Canada will grow by 5.1 per cent over the 2022-2030 period. The growth in Europe will be dominated by Germany, which will grow at approximately 3.9 per cent CAGR.
Scheduled from March 6-8, 2024, the Spring edition of Intertextile Shanghai Home Textiles will take place at the National Exhibition and Convention Center in Shanghai. This exhibition will feature a diverse range of highly sought-after home textiles, spanning from floor to ceiling. Co-located with Intertextile Shanghai Apparel Fabrics – Spring Edition, Yarn Expo Spring, CHIC, and PH Value, the event aims to facilitate connections and exploration of new possibilities within the industry.
Building on the success of the 2023 edition, which saw 26,538 trade visitors and 283 exhibitors from five countries and regions, the upcoming edition is poised to showcase a comprehensive array of home textiles, including bedding & toweling, rugs, table & kitchen linen, home textile technologies, and textile design. The concurrent textile fairs will create synergies, attracting various segments of the textile value chain.
The exhibition serves as a platform for international buyers to reconnect with Chinese suppliers. The 2023 edition spanned three days, fostering meaningful interactions and collaborations. Notably, China's efforts to streamline loan procedures for home refurnishing have contributed to a 7% year-on-year growth in consumables retail sales, further optimizing allocations for the retail sector.
Overall, the March edition of Intertextile Shanghai Home Textiles promises to be a dynamic showcase of the latest trends and innovations in the home textiles industry, providing a valuable opportunity for industry players to engage, collaborate, and stay abreast of market developments.
In a much-anticipated return, the Spring Edition of Intertextile Shanghai Home Textiles is set to take place from March 6 to 8, 2024, at the National Exhibition and Convention Center in Shanghai. This event promises a comprehensive showcase of sought-after home textile products, attracting exhibitors prepared to captivate buyers during China's peak sourcing season.
The fair's significance is heightened by its conjunction with other co-located events like Intertextile Shanghai Apparel Fabrics – Spring Edition, Yarn Expo Spring, CHIC, and PH Value, broadening the visitor scope for suppliers.
Amidst a globally sluggish economy, China's domestic market is showing resilience, bolstered by government initiatives promoting household consumption. Measures supporting the home industry and consumers, coupled with optimized loan procedures, have fueled a 7% year-on-year increase in consumables retail sales for the first eight months of 2023. The home textile sector, in particular, is experiencing a profitability upswing, influenced by both domestic demand and successful international trade agreements.
Ms. Rosemary Li of Zhangjiagang Coolist Life Technology Co Ltd notes the industry's swift recovery, citing increased domestic and export orders. The 2024 spring fair is poised to build on the success of the previous edition, facilitating international engagement and showcasing a diverse array of home textiles.
Messe Frankfurt (HK) Ltd's General Manager, Wilmet Shea, expresses optimism, emphasizing the fair's role as a vital platform for the industry to thrive in challenging times. The upcoming event, following a robust 2023 edition, is expected to attract a global audience and further fortify the textile industry's resilience.
Pakistan's textile exporters faced a challenging year in 2022-23, encountering a significant setback as orders plummeted by almost 15per cent, with a total value of $16.5 billion. This marks a substantial 14.63 per cent decline from the preceding year, 2021-22, when textile exports were valued at $19.33 billion. Disturbingly, data reveals a stark 18 per cent decrease in the country's textile exports during the first nine months of the calendar year 2023, plummeting from $14.5 billion in 2022 to $11.9 billion.
Drop in exports
A report by Samaa TV, a prominent Pakistani news channel highlights, the textile sector's exports in September 2023 was $1.35 billion, down 12 per cent from the $1.53 billion recorded in the same month the previous year. This continuous decline underscores a worrisome trend for the government, grappling with a shortage of foreign exchange. The government heavily relies on non-debt creating dollar inflows, such as textile exports, to bolster its reserves.
The All Pakistan Textile Mills Association (APTMA) released data in October 2023, emphasizing the persistently challenging scenario faced by Pakistan's textile sector. The industry is intricately tied to export markets in the EU, the UK, the US, the UAE, and Turkey. This downturn in textile exports poses a severe concern for the government, which urgently needs to address the diminishing foreign exchange reserves.
Revival on the cards
Minister of commerce Gohar Ejaz, who is also the patron-in-chief of APTMA, conveyed a sense of confidence in the textile sector. As per him, a notable achievement in October 2023 was, cotton arrivals surpassed five million bales, exceeding the previous year's figure of 4.9 million bales—a substantial 34 per cent year-on-year increase. Ejaz attributed this success to the unwavering commitment of local farmers and the resilient nature of Pakistan's cotton industry.
In addition, Ejaz underscored the global growth of textile market, which expanded from $573.22 billion in 2022 to $610.91 billion in 2023, signifying a compound annual growth rate (CAGR) of 6.6 per cent. This positive trajectory hints at a potential revival for Pakistan's challenged textile exports. Traditionally, Pakistan designates 60 per cent of its total textile output for exports, with Punjab playing a pivotal role in the sector. About 70 per cent of the textile industry is concentrated in Punjab, with Faisalabad as its hub. It's noteworthy that Pakistan holds the 8th position among the largest textile product exporters in Asia.
GSP renewal still uncertain
As reported by brerecorder.com, the fourth joint Generalised Scheme of Preferences (GSP) Review Report from the European Commission and the European External Action Service (EEAS) has detailed the progress of eight GSP+ beneficiary countries, including Pakistan. The report assesses the effective implementation of the 27 international core conventions that underlie the GSP+ scheme. Compliance with these conventions is a prerequisite for beneficiary countries to maintain their GSP+ status, covering human rights, labor rights, environmental standards, and good governance for the period spanning 2020 to 2022.
The report flagged several areas of concern, including political instability, constitutional challenges, an economic crisis, high inflation, and a severe shortage of foreign reserves. Notably, Pakistan holds the status of being the largest beneficiary of the GSP+ scheme. As the current GSP Regulation is set to expire by the end of 2023, Pakistan has initiated efforts to secure a renewal of its GSP+ status for the post-2023 period.
However, renewal bid faces challenges due to ongoing human rights violations, contentious blasphemy laws, and escalating religious intolerance and sectarian violence. Additionally, the country has struggled to achieve sustained development and poverty reduction, as expected by the GSP scheme. Italian news site InsideOver has raised concerns, suggesting uncertainty regarding the renewal of Pakistan's GSP+ status for the next decade.
Canopy’s recently unveiled 2023 ‘Hot Button Report’ has become a focal point in the fashion sector, shedding light on a definitive shift toward Next Gen production in MMCF (Man-Made Cellulosic Fiber). The report stands as the foremost fiber sourcing analysis tool, specifically addressing the nexus between fashion and forests. The Hot Button Report meticulously assesses the risk associated with MMCF producers tapping into high-carbon forests while highlighting advancements in Next Gen production. It incorporates crucial insights into chemical processing through its coverage of the Zero Discharge of Hazardous Chemicals (ZDHC) initiative.
Good progress in 2023
One of the standout revelations is the notable progress made in 2023, with 54 per cent of global viscose supply earning the coveted ‘green shirt’ status. This signifies MMCF producers' commitment to utilizing the CanopyStyle Audit, a robust mechanism for verifying their sourcing practices and evaluating associated risks. The CanopyStyle initiative has 550 global brands as participants, collectively boasting of an annual revenue $1 trillion.
An encouraging trend highlighted in the report is the increased engagement of MMCF producers with Canopy, with an additional 29 per cent joining forces in 2023. Canopy says 89 per cent of MMCF producers globally have embraced the CanopyStyle Audit, marking a significant milestone in ensuring responsible and sustainable sourcing practices. Impressively, the top 20 MMCF producers, comprising 71 per cent of global production, are actively involved in this transformative initiative.
Since its inception in 2016, the Hot Button Report has served as an annual catalyst for driving continual improvement in sustainability within the fashion industry. It operates as a vital instrument for navigating and influencing a supply chain that was previously shrouded in ambiguity, offering a roadmap for positive change in the realms of environmental responsibility and ethical sourcing.
Green shirt rating
Producers receiving a green shirt rating are recognized for their proactive measures to eliminate the risk of sourcing rayon and viscose from endangered and ancient forests. This signifies the producer has undergone a thorough audit, confirming their low-risk status. The rating is determined by the number of buttons allocated to producers in the Hot Button Report, each button reflecting the producer's efforts to eradicate the use of ancient and endangered forests in their supply chain. The rating considers the producer's preference for textiles crafted from innovative fibers.
The rating’s primary goal is to spotlight producers who surpass basic requirements, demonstrating a commitment to eliminating materials derived from ancient and endangered forests. The rating is significant as more MMCF productions attain green shirt status, providing producers with a broader array of Next Gen options. This shift aligns with their efforts to achieve Scope 3 goals and adhere to the recently enacted EU Deforestation Regulations.
India’s Aditya Birla Group ranks No. 1
In this year's Hot Button Report, Aditya Birla Group took the top spot, followed by Lenzing AG, and Tangshan Sanyou/Xinxiang Chemical Fiber (Bailu) in third. Three more MMCF producers—Formosa, Nanjing Chemical Fibers, and Shandong Hongtaiding—earned a green shirt rating in 2023. Additionally, Yibin Grace and Acegreen achieved the prestigious dark green shirt status. The report foresees more producers reaching this level next year, highlighting their commitment to sustainability.
MMCF production is shifting, with most Canopy-engaged producers investing in Next Gen R&D. Commercial-scale projects are underway, showing promise in replacing millions of tons of forest fiber. Leading fashion companies like Inditex, Mara Hoffman, PVH, and H&M are championing Next Gen textiles, integrating them into their lines. Producers with commercial-scale Next Gen products receive recognition with a circular icon, symbolizing their contribution to a sustainable fashion economy.
In a significant move during COP28, Global Fashion Agenda (GFA) has launched the 2023 edition of The GFA Monitor, a comprehensive guide for fashion leaders steering towards a net-positive industry. The report integrates insights from over 25 industry organizations, presenting a unified approach to sustainable practices.
Data-Driven insights
For the first time, the report incorporates insights from the Fashion Industry Target Consultation (FITC), drawing data from 900 participants across 90 countries. This inclusion provides a nuanced understanding of the industry's current status and challenges.
Sustainability framework
Aligned with the Fashion CEO Agenda, The GFA Monitor centers on five sustainability priorities: Respectful and Secure Work Environments, Better Wage Systems, Circular Systems, Resource Stewardship, and Smart Materials Choices. It acts as a practical tool offering clear actions and proven best practices.
Industry alignment and ambitions
The FITC reveals positive sentiments from participants regarding industry alignment on 27 proposed action areas. However, the report highlights the need for measured action and positive impact. It illuminates the industry's ambitions per priority, identifying areas requiring more aligned action.
Addressing global climate targets
With the 2030 deadline for UN Sustainable Development Goals approaching, The GFA Monitor emphasizes the urgency to peak greenhouse gas emissions by 2025. Despite commitments made in Paris eight years ago, the current temperature projections exceed expectations. COP28 serves as a critical moment for the fashion sector to assess progress and accelerate actions.
GFA's role at COP28
GFA, in alliance with UN Climate Change, will host a dedicated session at COP28, ensuring the fashion sector contributes to crucial climate discussions. The Global Fashion Agenda Assembly on December 5 will reflect on progress, financing best practices, and guide policymakers towards a net-positive future.
Quotes from industry leaders
Federica Marchionni, CEO of Global Fashion Agenda, emphasizes the power of alliances to accelerate sustainability measures. Scott Raskin, CEO of Worldly, GFA's data partner, highlights the need for primary supply chain data to address climate change.
Towards annual industry accountability
Building on previous editions, GFA envisions The GFA Monitor as an annual gauge of the fashion industry's progress, fostering accountability, presenting insights, and identifying critical actions. The report welcomes collaboration with other industry organizations.
Impact partners' perspectives
Leaders from Apparel Impact Institute, Ellen MacArthur Foundation, Fair Labor Association, Social & Labor Convergence Program, and Textile Exchange express their commitment to collective efforts for a positive impact on people and the planet.
In a world grappling with crises, The GFA Monitor stands as a beacon, providing a roadmap for the fashion industry towards a sustainable and net-positive future.
