FW
Bangladesh will shore up and offer incentives for export-oriented industries. Six export products alone account for nearly 90 per cent of the country’s yearly export earnings. Bangladesh’s exporters have been passing through a torrid time in recent times because of the euro zone crises, higher production costs and infrastructure deficiencies.
Leather goods will get from 12.5 per cent to 15 per cent and a two per cent extra incentive will be provided for apparel exporters to the euro zone countries. Two promising industries—furniture and plastic goods—will be eligible for incentives. Furniture will get a 15 per cent incentive and plastic goods a 10 per cent subsidy. The furniture sector raked in 38.64 million dollars in the 2014-15 financial year.
Non-traditional items such as potato starch will be given a 20 per cent export incentive against their receipts, while carbon exports from jute stick will get 20 per cent. A three per cent incentive is applicable for export earnings to be generated from countries other than the US, Canada and EU markets. The export value of Bangladesh readymade garments in the EU declined by 2.70 per cent in the first six months of the current fiscal year.
India’s cotton exports are expected to rise by 21.27 per cent during the 2015-16 season, mostly due to a rise in demand from Pakistan. Demand in Pakistan has grown due to crop damage in the Punjab region. Almost 33 per cent of the cotton crop in Pakistan has been damaged from whitefly. In the first three months till December 31, Pakistan already imported 16.60 lakh bales from India, while it had imported overall 3.79 lakh bales in the entire year of 2014-15.
This year, Pakistan will overtake Bangladesh as the top importer of Indian cotton. Howeverm cotton output in India is estimated at 352 lakh bales in 2015-16, compared to 380 lakh bales in the previous season, mainly on account of crop damage in Punjab due to whitefly, white ball worm in Gujarat and drought in Karnataka.
India’s textile industry is predominantly cotton based. India is one of the largest producers as well as exporters of cotton yarn. India was the third largest supplier of textiles and clothing to the US in 2013, contributing about 6.01 per cent of its total imports. Cotton cultivation in India in 2014-15 was 12.25 million hectares.
Gujarat, Maharashtra, Andhra Pradesh, Haryana, Punjab, Madhya Pradesh, Rajasthan, Karnataka and Tamil Nadu are the major cotton producers in India.
The American Apparel & Footwear Association (AAFA), a trade association representing more than 1,000 brands with members from across the entire fashion supply chain, released a statement in support of the Trans-Pacific Partnership. With the TPP covering 40 per cent of the world's GDP and reaching approximately 800 million consumers, the trade pact represents significant opportunities for the clothing, shoe, and accessories industry. For this reason, and after consultation with our members, said the association expressing their strong support for the TPP.
The association says the US apparel, footwear, and accessories industry is a global industry in which nearly every US job in their business depends on access to foreign customers or global supply chains, or both. TPP will provide opportunities to reduce costs, stay competitive, and enter new markets.
They observed that the benefits of the TPP will materialize more quickly in the case of travel goods (items such as handbags, backpacks, and laptop cases) and footwear, which feature more flexible rules of origin and immediate duty-free treatment for a wide range of products. While there are some immediate opportunities for apparel, most apparel articles are constrained by extremely restrictive rules of origin and long duty phase-outs, meaning benefits will take longer to realize.
The US apparel, footwear, and accessories industry employs more than four million U.S. workers, and represents more than $360 billion in U.S. retail sales.
According to the International Cotton Advisory Committee (CAC), citing the enhanced competitiveness of polyester China, which last season lost to India the title of the world's top cotton producer, is to give up top rank in imports too. The committee deepened to 40 per cent, from 34 per cent, its forecast for the top in Chinese cotton imports in 2015-16, taking the estimate from 1.2m tonnes to 1.08m tonnes (5.0m bales).
According to CAC projections, they would demote China to equal second, with Bangladesh, on cotton imports, behind Vietnam, which is expected to buy 1.1m tonnes this season. ICAC highlighted the role in Vietnam's rise as a cotton importer, with volumes seen soaring 17 per cent this season, its low labour costs.
However, it also flagged the enhanced competitiveness of polyester, of which China produces 72 per cent of global supplies, making this fibre a particularly acute rival to cotton for the country's mills. Polyester's discount to cotton has ‘continued to widen,’ ICAC said, reporting that values of the artificial fibre had averaged 48 cents a pound in the first half of 2015-16.
Cotton prices, as measured by the Cotlook A index, averaged 70 cents a pound. The ongoing drop in polyester prices cuts into cotton's market share, particularly in China where polyester has been favoured over cotton in recent seasons, the committee said, cutting by 200,000 tonnes to 7.1m tonnes its estimate for Chinese cotton consumption in 2015-16.
"The 14 beneficiary countries, as well as EU and international institutions and civil society organisations, will now have an opportunity to respond to the findings of the report. The first report on the concrete effects of the GSP+, the EU trade policy instrument published by the European Commission and the EU High Representative to encourage third countries to comply with core international standards in the areas of human rights, labour rights, environmental protection and good governance has been released."
The 14 beneficiary countries, as well as EU and international institutions and civil society organisations, will now have an opportunity to respond to the findings of the report. The first report on the concrete effects of the GSP+, the EU trade policy instrument published by the European Commission and the EU High Representative to encourage third countries to comply with core international standards in the areas of human rights, labour rights, environmental protection and good governance has been released.
Compliance assessment for beneficiary nations
The countries involved pay no duties when exporting a range of products to the EU through this system, which builds on the existing Generalised Scheme of Preferences (GSP). In return, they must have ratified 27 core international conventions – including the United Nations (UN) conventions on human rights and the conventions of the International Labour Organisation (ILO) on labour rights – and agree to cooperate in monitoring their implementation. This report provides the first compliance assessment.
According to Federica Mogherini, High Representative and Vice-President of the European Commission, development is deeply linked not only to economic growth but also to social improvements. That is why the EU is working, together with the 14 countries involved in the GSP+, to improve the situation on human rights, with a particular focus on labour rights, social justice, environmental protection and good governance. The 14 countries have shown political and institutional engagement, which needs to be followed up also by implementation. “We have not fully achieved all the goals yet. Making a difference on the ground is what counts and this will be at the heart of the EU's monitoring and dialogue during the next 2-year reporting period,”says Mogherini.
Cecilia Malmström, EU Commissioner for Trade stated that they have done much work over the past two years, engaging with vulnerable countries who asked for enhanced access to the EU market. All 14 countries that benefit from this arrangement have made significant efforts to improve the situation as regards human rights, labour rights, environmental protection, and good governance. However, the situation is far from perfect. Progress is slow, as this report clearly shows; but with this report, the EU identified shortcomings, which equips us with better knowledge and tools to make improvements in the years to come. We will now continue with our dialogue and cooperation to make sure that the countries continue to implement the 27 conventions.
The 14 countries covered in the report are: Armenia, Bolivia, Cabo Verde, Costa Rica, Ecuador, El Salvador, Georgia, Guatemala, Mongolia, Pakistan, Panama, Paraguay, Peru, and the Philippines.
As per the report, all 14 GSP+ beneficiary countries demonstrated progress. They strengthened their domestic institutions responsible for an effective implementation of the 27 key international conventions, improved relations with the international bodies – including various UN agencies – responsible for monitoring of the conventions' implementation, and upgraded their reporting activities. These are significant steps paving the way towards further practical changes. In areas where progress has been slower, the EU will engage in dialogue with these countries in order to find ways of speeding up the process.
Intensive contacts between the GSP+ countries, the European Commission and the EEAS have allowed for a detailed assessment of each country's progress, as well as of the main challenges and working priorities for the coming years.
Azerbaijan is keen to support cotton producers and give a new life to the cotton production industry. In this regard, farmers will be given preferential loans. Favorable prices will be considered for agricultural producers. New technologies, minerals, and varieties are being developed to lower the cost of cotton production. Farmers will be assisted while purchasing seeds, fertilizers and for conducting agro-technical works.
Cotton production is traditionally widespread in the country's Saatli, Sabirabad, Beylagan, Barda and Zardab regions. Azerbaijan was famous for a high production of cotton in the last century and was even a leading cotton producer in the Soviet Union. However, over the past 18 years, production has dipped six-fold. As a result, areas grown under cotton have reduced nine-fold. The decrease in interest in cotton has resulted from the low profitability margins of cotton production.
Azerbaijan collected 35,000 tons of cotton in 2015, which is 14.6 per cent less than in 2014. This is the lowest indicator of cotton production in Azerbaijan since 2010. However, the average yield in the country was 4.5 per cent more than in 2014. Exporting countries have created an artificial market with low prices, which has hampered opportunities for selling Azerbaijani cotton.
Central Java is emerging as an attractive top investment destination for textiles and textile products in Indonesia. This region has attractive factors going for it like availability of labor, a market, and a developed network for distributing textile products. In addition to Central Java, other provinces which are top ranking textile investment destinations in Indonesia are West Java and East Java.
The main investment in the textile sector goes to industrial processing and spinning of textile fibers, followed by the apparel industry, which is followed by the textile industry. Japan is a major investor with 93 projects capable of absorbing 11,906 workers. Indonesia has a well-established, vertically integrated textile industry that is involved in almost every sector of the textile supply chain — from the production of manmade fibers, particularly polyester, nylon and rayon; man-made and cotton yarn spinning; and weaving and knitting; to dyeing, printing and finishing; and apparel and also textile product manufacturing. Most of these companies are located in the region of Java.
However, the Indonesian textile industry is trying to reduce its dependence on imported textile machinery and is being encouraged instead to purchase domestically produced machinery. Tax incentives are being offered to Indonesian textile machinery producers as well as stimulus funds to textile plant owners to upgrade their machinery.
Myanmar’s apparel exports are expected to more than double by 2020 owing to the favorable government policies and low labor costs in the country. One of the reasons for this is the high wages and relatively higher cost of production in countries like Vietnam, India, China, and South Korea, which is driving entrepreneurs to Myanmar. Secondly, entrepreneurs from China, South Korea, India, and Vietnam are keen on investing in the garment sector of Myanmar to take advantage of the benefits it enjoys with the developed markets of the US, EU, and Canada.
The new foreign investment law, which was passed in 2012, increased the maximum shareholding of foreign parties in manufacturing to 50 per cent, making the country a suitable sourcing destination for garments. The law also allows foreign investors to lease land for an initial period of 50 years, tax exemption for the first five years, and tariff-free import of raw materials to these companies.
The garment industry of Myanmar employs more than 2,50,000 people and accounts for 10 per cent of export revenues. Myanmar offers some of the cheapest labor costs on the planet combined with easy access to Asian markets -- both attractive features for corporations looking to source low-cost, ready-made garments for export.
The recently concluded international fashion trade show ‘Gallery’ attracted a record number of visitors with a 20 per cent rise. The show was held from January 29 to February 1, 2016 for the first time in the Alte Schmiedehalle as well as at Halle am Wasserturm on the Areal Böhler site. Red Carpet, the orders fair for evening and occasion wear has also booked a successful start.
Ulrike Kähler, Project Director National Trade Shows at the Igedo Company said that the show was very successful premiere for them and they are sure to continue to position Düsseldorf at the hub of the international fashion sector with our presentation at Areal Böhler.
The organisers Igedo Company were able to post a significantly higher visitor footfall than at the Botschaft on Cecilienallee, the ‘Gallery’s former venue. In particular, the showroom concept offering exhibitors a presence over 10 days has generated avid interest among many exhibitors.
According to Philipp Kronen, Managing Partner at the Igedo Company, Düsseldorf is in buyers’ diaries as an orders location. With Gallery and Red Carpet events they will continue to work on the selection of presented brands and leverage the atmospheric backdrop of Areal Böhler in a variety of ways.
The United States was Vietnam’s biggest goods importer in 2015, up 16.9 per cent against 2014. China was Vietnam’s second largest goods importer, up 11.2 per cent year-on-year, followed by South Korea with an increase of 25.03 per cent. Vietnam’s two-way trade with other Asian markets rose by 8.9 per cent over 2014, and these markets made up the biggest proportion of the total, at 65.6 per cent. Apparel is one of Vietnam’s major export earners.
China was Vietnam’s biggest exporter in 2015, a year-on-year rise of 13.9 per cent. Vietnam’s goods exports to the EU climbed 9.4 per cent, to Africa were up 9.8 per cent. Exports to Australia were down 16.2 per cent versus 2014. Vietnam had trade ties with over 200 countries and territories last year. Her exports rose 7.9 per cent year-on-year and imports were up 12 per cent.
Last year, Vietnam spent $14.37 billion on imports from Japan, increasing 11.15 per cent from a year earlier. The nation bought nearly $11 billion worth of goods from Taiwan, down 0.78 per cent; and $8.28 billion from Thailand, growing 16.79 per cent. Vietnam’s imports from South Korea in 2015 showed a strong increase of 27 per cent versus 2014.
