FW
"Nothing is isolated in world economy today. The US government, in its attempt to punish China for unfair trade practices and reduce its $3.75 billion trade deficit, is forcing some of its strongest allies to run for protection. A prominent partner, Vietnam exported around 35 per cent of its goods to China and the United States last year. However, the US-China trade war led to a sharp devaluation of the Vietnamese currency causing a steep decline in its stock markets. Rumors spread about an influx of cheap Chinese consumer goods and the threat of American protectionism spreading in ways that would affect Vietnam’s vital exports. Nearly $5 billion of Vietnamese exports, that are a part of China’s value-added supply chain, may feel the impact of being exposed to punitive American tariffs."
Nothing is isolated in world economy today. The US government, in its attempt to punish China for unfair trade practices and reduce its $3.75 billion trade deficit, is forcing some of its strongest allies to run for protection. A prominent partner, Vietnam exported around 35 per cent of its goods to China and the United States last year. However, the US-China trade war led to a sharp devaluation of the Vietnamese currency causing a steep decline in its stock markets. Rumors spread about an influx of cheap Chinese consumer goods and the threat of American protectionism spreading in ways that would affect Vietnam’s vital exports. Nearly $5 billion of Vietnamese exports, that are a part of China’s value-added supply chain, may feel the impact of being exposed to punitive American tariffs.
Business shifting out of China to avoid tariff
The trade war has also led many foreign companies to shift their production to Southeast Asia. Around 72
Japanese businessmen are planning to expand their investment out of China to shun the risks caused by rising production costs and US-China trade war which is making it difficult for Japanese firms to exports their products to the US from China.
Also, wages in Vietnam are barely a third of those in China, making it easier for brands like Adidas to manufacture twice as many shoes as it does in China. The race is to secure excess manufacturing capacity all around the region — in Thailand, Indonesia and elsewhere, is heating up.
Effect of tariffs on supply chain
China exports complex products to the United States. These are assembled in China from a staggering array of foreign components and raw materials. For instance, a laptop made in China, may have a South Korean screen, a Japanese hard drive and a memory chip from Taiwan. A tariff hurts every part of this international supply chain.
To offset the conflict’s negative impact, Beijing has slashed tariffs for Asian countries. This appeal, however, may not stop the flow of manufacturers out of China to Southeast Asia. The American shoe-and-accessory maker Steve Madden, for example, is shifting its handbag production from China to Cambodia. New tariffs are being planned for another $200 billion worth of Chinese imports, with 6,031 products on its target list.
Vietnam to benefit from trade war
Chinese companies may shift more operations southward using ‘’tariff-jumping” tactics to get their goods to the United States. The Vietnamese, at least, are vigilant against Chinese intrusions. In fact, the country might benefit from China’s conflict with the United States, Vietnam’s strongest allies. The Vietnamese government is projecting negligible decline in growth over the next five years. In July, Standard Chartered raised its growth forecasts for Vietnam to 7 per cent this year, based on the influx of foreign direct investment. In addition the country may also pull in American buyers eager to diversify their imports from outside China.
World Textile Merchandising Conference (WTMC) was held in China, September 20 to 21. The conference saw participants share their ideas on the coordinated development of the global textile fashion industry and the transformation of China's textile industry under the Belt and Road Initiative.
At the conference, the World Textile Merchandising Conference Council, consisting of 12 representatives from textile associations of countries like China, Egypt, Indonesia, Malaysia, France, Turkey, Vietnam, Cambodia, and Laos, was formally established.
The event explored latest changes and trends in the textile industry and sought to build a cooperation system throughout the industrial chain, therefore, promoting high-quality development. It explored new patterns of globalisation and transformation of the textile industry. Firms, fashion institutions, industry associations and design institutes from more than 20 countries participated. The conference discussed the future of the world’s textile industry.
Shaoxing, where the event was held, has a full textile industry chain. China is expected to surpass Europe and the United States to become the largest retail market in the world by 2020. Its textile industry has to strengthen international cooperation, actively promote cross-border flows of resources such as products, production capacity, technology, capital, and talents, strengthen product innovation and advance industrial intelligence and service transformation.
Denim brand Wrangler has introduced foam-dyed jeans to lessen environmental impact and save precious resources. Tejidos Royo, a Spanish fabric mill with a reputation for prioritising environmental performance, will integrate the foam-dye process called Dry Indigo®. It will receive the foam-dye equipment in October and begin supplying Wrangler with denim before the end of the year.
Wrangler and Walmart Foundation have provided Texas Tech University with early-stage funding for development of the foam-dying process, recognising the potential of this development. The iconic denim brand helped introduce fabric mills to the latest technology and now will incorporate the first foam-dyed denim into a line of jeans launching in 2019.
As per Royo, applying indigo dye to raw denim with foam instead of water will eliminate the need for the tens of millions of gallons of water typically consumed by conventional wet-dye systems.
The UK is one of the biggest clothing exporters in Europe. And when it comes to buying British, the US is the biggest shopper followed by China. One of the major reasons for the rise in shopping from the UK is pricing. The pound’s falling value is helping make goods even more attractive to foreign wallets. The other top motivations for cross-border buying are the chance to get hold of products not available in their own country and the opportunity to discover new things to buy.
Mobile shopping is also helping power the UK’s international popularity. Also working in British retailers’ favor is the fact the nation’s top two export markets, the US and China, are at the forefront of this mobile revolution. Here, smart phone shopping accounted for 61 per cent and 84 per cent of international online purchases respectively in the last year.
To build on this achievement, the country is making it easier and cheaper for UK firms to sell online to customers around the world – with face-to face support from e-commerce advisers, negotiated preferred rates on online marketplaces and information. The ambition is to grow exports as a percentage of GDP to 35 per cent, and getting more UK firms to sell online is key to achieving this.
Textile and garment firms have reported buoyant performance to date this year due to a multitude of factors, including escalating trade tensions between the US and China. Many surveyed firms have attributed rising revenues to a sharp jump in order volumes. In addition, the trend of foreign (mainly US) textile and garment importers shifting orders from China to Vietnam to mitigate risks has become more apparent amidst the escalating US-China trade tensions.
Tran Nhu Tung, member of the board of management at Thanh Cong Textile Garment Investment Trading JSC says in the first eight months of this year, they posted VND2.46 trillion in cumulative revenue ($109 million), equal to 80 per cent of its full-year plan, while its after-tax profit hit VND185 billion ($8.2 million), a 44 per cent jump over the projection and fulfilling its full-year profit target. According to Tung, this upbeat outcome came in the wake of the company’s efforts to restructure production and boost production capacity.
Similarly, TNG Investment and Trading JSC rose more than 25 per cent in the past two months. In the first eight months of this year, the company reported VND2.36 trillion ($104 million) in cumulative revenue, reaching 86 per cent of its full-year, while its profit came to VND118 billion ($5.2 million), a 54 per cent jump over the same period last year and reaching 93 per cent of the full-year profit target. This year, TNG estimates reaching VND3.45 trillion ($152 million) in revenue and VND157 billion ($6.9 million) in after-tax profit.
About 60,000 tons of cotton have been harvested in Tajikistan in this cotton harvest season. Since the beginning of the cotton harvest season, 16.2 per cent of the planned amount has been harvested. As many as 1,85,817 hectares were allocated in Tajikistan for the cultivation of cotton this year. Cotton fields were expanded at the expense of grain and fodder crop areas.
In 2017, 3,80,000 hectares of cotton were harvested in Tajikistan, 5.2 per cent more than in 2016. Until the middle of the 2000s, cotton was considered one of the two main export goods of Tajikistan (along with aluminum). In the 1980s, about 8,00,000 tons of cotton were harvested annually in Soviet Tajikistan.
At the same time, most of the cotton fiber produced in the country is exported as raw materials. The processing of these products within the country is insignificant. However, cotton makes an important contribution to both the agricultural sector and the country’s economy. Along with primary aluminum, cotton has been one of the major export items for Tajikistan. In 2015, cotton fiber accounted for 23.1 per cent of Tajikistan’s exports. In 2016, cotton fiber’s share in Tajikistan’s exports fell to 16.1 per cent. Last year, cotton accounted for an estimated 13.5 per cent of Tajikistan’s exports.
Japan and Vietnam are strengthening ties. Bilateral economic cooperation has developed in recent times. Japan is the largest foreign investor in Vietnam. More than 3,100 Japanese businesses have undertaken investment in Vietnam, marking an increase of 40 per cent in four years. Japan has been implementing an array of collaboration programs with Vietnam in developing hardware infrastructure, such as bridges, seaports, airports, and expressways. Japan has partnered with Vietnam in perfecting the latter’s legal system, training human resources, and improving labor productivity.
In the coming time, together with expanding investment areas and scale, Japan expects to continue cooperating with Vietnam in infrastructure development, thus supporting its sustainable development. Vietnam is now in a great transition phase in terms of politics and economy, with abundant energy sources for growth.
Japan also hopes to join hands with Vietnam to improve its administrative capacity. Japan is prone to natural disasters and Vietnam is one of the countries hardest hit by climate change. The countries will work on minimising the negative impact of climate change.
Both Vietnam and Japan are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). In the context of rising protectionism in several economies, bringing the CPTPP into force at an early date is particularly crucial for both countries.
Marchi & Fildi, leading Italian manufacturer of Ecotec smart cotton, will launch Spring/Summer 2020 collection at the upcoming Filo trade fair for yarns and fibres, to be held in Milan next week. The company, in this collection will opt for organic vegetal texturing, soft tonalities for jacquard open, clean plaids, bayaderes and new athleisure semi plains for Polaris and Chagall qualities.
The collection will include new casual textures and crisp, dry Prince of Wales checks work in Pegasus yarns. Phoenix will be colourised in fancy mesh stripings., while Ginerva luxe quality will comprise the lightest double face combinations or elaborate open lace effects. Manipulated pleated stripes and tonal jacquards or in random surface textures using smart blended Phoenix qualities will denote texture and movement.
This season, contemporary brand adoptions include Ice Monkey Berlin. The brand designs timeless and luxurious T-shirts and polos. As a young fashion brand from Berlin, it is constantly looking for smart solutions. Therefore, the brand selected several Ecotec jersey qualities produced by Tintex Textiles for its capsule collection 2019.
The International Apparel Federation (IAF) and MODINT have introduced the complete list of sponsors for the 34th IAF World Fashion Convention. The event will draw an estimated 250 delegates from over 20 countries worldwide. The sponsors have been divided into four categories: Diamond, Platinum, Gold and Silver.
The Diamond Sponsor includes C&A Foundation, a corporate foundation that works with the change-makers of the world, gives them financial support, expertise and network to enhance the functionality of the fashion world. Platinum sponsor GS1 provides global standards for efficient business communication, while Icecat is a global publisher and syndicator of product information for the e-commerce market. Gold Sponser TKI Dinalog/HIDC offers the best in lifestyle supply chain research, I Heart Studios offers highly creative visual content business, Pivot88, a cloud-based collaboration platform structures, automates and standardises quality management and compliance processes.
Silver sponsors for the event include MOTIF, an apparel knowledge hub, Retailisation software; Foursource , a global B2B network for apparel and textile sourcing; Browzwear’s providing 3D solutions for apparel design, development and merchandising; EE Labels, a label company, WRAP, a company dedicated to promoting safe, lawful, humane, and ethical manufacturing and Inspectorio, a cognitive quality and compliance platform empowering a transparency network
Bronze sponsors include Fair Wear Foundation, Gerber Technology, Modint, Credit& Finance, Euler Hermes, YKK, A&E, Neenah Coldenhove, AQM
Garment workers in Karnataka get paid wages that are 25 per cent below the urban poverty line. Though in many families, there are two wage-earners earning subsistence wages, one in seven garment families has only a single woman wage-earner.
The industry refuses to consider any substantial increase in wages, claiming that it would undermine profitability. The garment industry uses low wage states as the reason to oppose wage increase in states with higher wages. This is exactly what the garment industries in Karnataka are doing. They argue that since minimum wages in Karnataka are higher than in other states increasing wages would have an adverse impact on an industry that is already facing tough international competition.
Garment manufacturing in Karnataka is mostly for export to developed countries. In fact a large proportion of the manufacturing in the Indian garment industry is for the export market. In Karnataka the RMG export industry is mainly concentrated in urban regions around Bangalore. These units threaten to shift to Telangana especially when the issue of wage revision comes up. That means management has the upper hand in determining the minimum wages of workers in the textile industry, spinning industry and the printing and dyeing industry.
