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China's Ministry of Industry and Information Technology has said that the country’s textile and garment exports continued to decline last year, mainly due to the good performance in the previous year and exchange rate fluctuations.
The sharply depreciated yen and Euro had a direct negative impact on textile exports, as Japan and Europe have been China's main textile export markets. From January to October in 2015, the textile industry saw positive growth in exports to the United States, Africa, South Korea, but exports to other markets dropped during the same period.
China's textile export to the European Union reached $44.86 billion, falling by 10.6 per cent year-on-year, the export to Japan reached $18.8 billion, dropping 12 per cent, and the export to ASEAN countries hit $29.03 billion, slipping 1.7 per cent, according to customs data.
In November, retail sales revenues of clothing of China's 100 key retail enterprises fell by 5 per cent year-on-year. Meanwhile, from January to November, national online sales reached 3.45 trillion yuan, surging 34.5 percent year-on-year, and sales of clothing jumped 23.5 percent, the ministry said. As China is undergoing an economic transformation, high-tech industries are springing up in China's developed coastal regions to replace labor-intensive industries such as the textile industry.
During the same period, the added value of the textile industry increased 6.4 per cent year-on-year, and the sector continued to expand the scale of production. But the decreasing quality of domestic cotton has forced enterprises to largely import cotton from India and Pakistan. In addition, weak domestic consumption, shortage of orders, increasing costs of labor and electricity, and environmental controls have left Chinese textile companies striving to cope with international competition, the ministry added.
www.gov.cn
The UK Fashion & Textile Association (UKFT) has announced it has become the Sector Skills Body for the Fashion & Textiles industry. UKFT has taken over the management of current apprenticeship framework and also the responsibility of both registration and certification of apprentices in England, Scotland and Wales. The Association will work with devolved nation’s stakeholders to ensure that National Occupational Standards and apprenticeship provision for the sector are maintained and developed.
The announcement came as UKFT, Damian Collins MP and Graduate Fashion Week hosted key policy makers, industry influencers, major retailers, leading brands and UK manufacturers at the House of Commons to celebrate the fashion and textile industry.
“With industry skills and training being a huge part of UKFT’s commitment to the sector, this is very welcome news. We are proud to take over from Creative Skillset, which has supported the industry since 2010 and we thank them for the achievements made during that time. It is extremely important to ensure the management and certification of apprenticeships and other vocational qualifications is closely aligned to the needs of the industry,” says Adam Mansell CEO, UKFT.
Mark Froud, MD, Federation for Industry Sector Skills & Standards (FISSS) said, “We look forward to working with UKFT as being close to the employers is critical and they have their trust and respect. UKFT has a strong approach to ensuring that Apprenticeships and training are kept up to date in what is an increasingly fast paced world.”
"While the rupee having depreciated substantially in the past year to trade at about 66.60 to 66.80 against the dollar compared to around 62 a year ago, other emerging markets currencies including the Chinese yuan have weakened much more sharply, which makes it even cheaper for foreign countries to buy products from countries such as China."
India has set a target of $900 billion in exports by 2020, from the $470 million reported in the last financial year. However, according to a report by Crisil Research, “This might prove a tad too ambitious if the current cyclical slowdown lasts and structural issues are not addressed”.
Slow global economy and dwindling competitiveness
India’s merchandise exports fell by 18.5 per cent in dollar terms to $174.3billion in the first eight months of this fiscal year, between March 2015 to April 2016. “Falling competitiveness is one of the structural factors restricting export growth,” the report points out, adding, “For key export items such as gems and jewellery, and textiles, revealed comparative advantage has come down over the years. Non-tariff barriers such as high transaction costs and infrastructure deficit, too, create hindrance as India continues to lag most Asian peers on these parameters.”
“Small wonder India’s export performance has suffered. Export destinations are not doing well, prices of many export items have fallen, and the rupee, too, has appreciated in real terms against a basket of 36 currencies. But our analysis shows the decline in exports is more than that warranted by these factors,” says CRISIL report.
It further points out that while global real GDP growth picked up from 3.2 per cent in 2009-11 to 3.4 per cent in 2012-14, India’s real growth of exports plummeted from 11.1 per cent to 4.1 per cent. “Almost half of all India’s exports are sent to other countries in Asia and the next biggest market for its goods is Europe. Economic weakness in these areas is taking its toll. Country-wise, the biggest contributors to the slowdown in India’s exports have been China, Saudi Arabia, Singapore and Japan, all of which have seen exports contract by double digits in fiscal 2015 and so far in this fiscal,” says Crisil, adding. “These are followed by European markets – the UK, Netherlands, Belgium, Italy and France – all showing continuous decline.”
No sign of revival in sight
Experts feel with official data showing the contribution of exports in India’s GDP falling from 25.2 per cent in the 2013-14 financial year to 21.2 per cent in the first half of the current financial year, there is no hope of a rebound in exports in the near future. While the rupee having depreciated substantially in the past year to trade at about 66.60 to 66.80 against the dollar compared to around 62 a year ago, other emerging markets currencies including the Chinese yuan have weakened much more sharply, which makes it even cheaper for foreign countries to buy products from countries such as China.
Along with reforms in logistics and other sectors and government support in the form of able export policy, India’s exports sector will also have to deal with the threat of being negatively impacted by the Trans Pacific Partnership, a trade agreement which was reached in October 2015 by 12 countries, including the United States, Vietnam, Japan, Mexico, Peru and Australia. “Trans Pacific Partnership countries account for 25 per cent of India’s exports. So by not being a part of TPP, India risks losing out a significant chunk of its export market to rivals,” Crisil warns.
“Clearly, India needs to invest quickly in skilling its large manpower and developing infrastructure to be able to attract foreign investment and become a world-class exporting hub,” the report sums up
www.crisil.com
Pakistan’s readymade garment manufacturers have urged the government to address all issues of the value-added textile sector immediately, as the continued drop in exports may widen further due to the Vietnam-EU free trade agreement, a massive decline in cotton production and a high import duty on yarn.
Pakistan’s export market has already shrunk due to high energy costs and discriminating import duties on industry raw materials. Exports of textiles and clothing have been declining sharply during the last six months along with low cotton yield.
The country’s garment makers want a reduction in all input costs. The textile sector is burdened with multiple taxes with high cost of inputs, tariffs of gas, electricity, raw materials, and is further harassed due to short supply of all these most essential utilities. Pakistan is facing almost a 35 per cent shortfall in cotton production as cotton bales arrivals have registered nine million bales against the set target of 14 million bales. Despite the huge shortfall of cotton, there is a 10 per cent regulatory duty on cotton yarn imports from India. It is feared that this will not only encourage cartelisation but will also squeeze raw material availability in the country.
Vietnam is emerging as a major threat for Pakistan’s textile sector.
Bangladesh’s earnings from readymade garment exports to 11 European Union countries declined in the first half of the current financial year 2015-16 compared with that in the same period of the last financial year.
The reason is a devaluation of the euro against the dollar.
Besides the negative growth in 11 destinations, earnings from two other major EU countries –– Germany and France –– achieved minimal growth. Robust earnings from the UK and Spain, two other major markets for Bangladesh garment products, helped the country’s export earnings in the EU block to post 7.34 per cent growth in the period.
Earnings from Germany grew by 1.18 per cent in the July to December period of financial year ’16 compared to the same period of financial year ’15. Earnings from France showed a 2.31 per cent growth. Earnings from the United Kingdom grew by 25.70 per cent. Earnings from Spain showed a 13.53 per cent growth in the period.
Earnings witnessed negative growth in Turkey and Brazil in the first half of financial year ’16. But earnings growth in most non-traditional markets was healthy. These showed a 8.13 per cent growth. Australia, Chile, China, India, Japan, Korea, Mexico, Russia, South Africa are considered non-traditional markets.
East African nation of Rwanda wants to develop its own textile industry, cut import of garments and create jobs through factories. Every year, the country is spends over $15 million importing second hand clothes. In order to reduce reliance on imported clothing, the country is seeking funds and skills from Chinese investors to establish garment factories.
Among the economic platforms, tailoring has been seen top opportunities for increasing more locally made products. It is possible that some imported knitted clothes such as uniforms can be made by locals. And Chinese investors have offered to train local tailors.
Rwanda has the advantage of a strong and disciplined workforce. The country wants to achieve large-scale industrial manufacturing and develop a broad base of skills in manufacturing and diversify the country’s export base. In time it hopes to start exporting textile garments to Europe and the US.
The tie-up with Chinese companies will help Rwandan youth and women acquire practical skills on manufacturing garments for both domestic consumption and export, establishing garment and textile production centers. Activities like cutting, finishing, packaging and warehouse will equip them with the necessary skills.
All Pakistan Textile Mills Association (APTMA) has demanded imposition of 10 per cent regulatory duty on the import of yarns and fabrics to support the domestic trade. The association has written to the ministry of finance seeking the imposition on these two products.
According to the numbers quoted by APTMA, during the last fiscal year 2014-15, yarns (chapter 54-55) and fabrics (chapter 54-55) amounting to Rs 92.217 billion were imported compared to Rs 63.416 billion in FY13. A large quantity of yarns and fabrics is being imported from India, capturing the share of domestic market. Therefore, APTMA demands regulatory duty on the import of yeans and fabrics to protect the domestic industry and trade, it said.
Import data of the Federal Bureau of Statistics (FBS) revealed that import of yarns and fabrics have increased in quantity by 37 per cent and 56 per cent, respectively from 2012-13 to 2014-15. According to the Chairman APTMA, surge in import of yarns and fabrics in Pakistan is adversely affecting the domestic industry resulting in closures of mills producing yarns and fabrics meant for domestic consumption.
www.aptma.org.pk
A garment exposition is being held in Bangladesh, January 13 to 16, 2016.The fair paves the way for the display of readymade garment-related equipment. This is a garment accessories, packaging and related machinery trade show. It is being attended by representatives from the global machinery, fabrics, yarns and accessories industries. Several products and services are being displayed. These fall in the area of garments, accessories, packing, garment accessories and garment equipment. Among the exhibits are corrugated cartons, stickers, hang-tags, barcodes, sewing threads, tapes.
Bangladesh has quality products, plus a large skilled workforce, and the country hopes to overtake China and become the number one sourcing destination.
A good number of European Union premium buyers are sourcing products from Bangladesh, shifting their focus from China.
A big Bangladesh readymade garment manufacturer imported 3500 pieces of machinery last year. These manufacturers are on a capacity expansion drive to meet the higher demands for products.
Bangladesh is expected to remain lucrative as a readymade garment source for at least the next 10 years. The trend of inflow of work orders is higher than that of previous years as buyers are satisfied with the ongoing safety progress.
Bangladesh has set a target of 50 billion dollars in export of readymade garments by 2021.
The international conference on denim, Intexcon will be held on February 19 and 20, 2016 at Ravi Matthai Auditorium, IIM in Ahmedabad, following the theme of ‘A democracy in Fashion’.
The industry experts participating in the conference will deliberate upon topics like ‘Indian Economy and Textile Industry’, ‘Denim - The Blue-eyed segment of the T&A Sector’, and ‘Jeans - The prime mover of the Denim Industry’. Some of the recent International exhibitions have confirmed renewed thrust to denims by taking into considerations the fashion, trends beyond cotton, enhanced use of stretch yarns, super stretch, knitted denims, re-entry of pure and dark blues, indigo shirting’s and tops, coated and functional denims, recycled products and finally sustainability.
To deliberate upon ‘Whither Denims’, Diagonal Consulting (India) will be organising a global summit on “Denims – A Democracy in Fashion”. International denim and jeans players, value chain experts, leading brand makers and retailers, researchers, designers, trade channels, policy makers, and others are expected to participate in the event.
The conference will be chaired by PR Roy, and will be supported by iNDEXTb Industrial Extension Bureau, a government of Guajarat Organisation.
www.intexcon.in
Archroma, a global leader in colour and specialty chemicals has appointed a Sustainability Officer for its textile specialties business and released its list of products compliant with the new version 1.1 of its list of Zero Discharge of Hazardous Chemicals (ZDHC) Manufacturing Restricted Substance List (MRSL) published in December 2015.
James Carnahan, who joined from the BASF textile chemicals business acquired by Archroma in July 2014, has been appointed as Global Sustainability Manager, Textile Specialties, and will be responsible to further intensify the business focus on more sustainable solutions. Carnahan has more than 30 years of experience in textile chemicals in application development and marketing and sales in South Africa, Italy, Germany, China and Singapore. In his last role with BASF, he was responsible for portfolio strategy development and implementation, with focus on developing sustainable solutions to support the textile value chain in this direction.
On this new appointment, Thomas Winkler, President Textile Specialties at Archroma said, “Everyone at Archroma is committed to continuously challenge the status quo in the deep belief that we can make our industry sustainable. We have been looking for the right sustainability specialist and, when we met James Carnahan, we realized he shared our belief and had been acting upon it during his past tenure.”
Archroma had published its list of ZDHC MRSL-compliant colorants and chemicals for textile and apparel for the first time in July 2014, shortly after the first version of the ZDHC MRSL was released. The list features a full range of colorants and chemicals for colours and functional effects, and process chemicals, covering fibres to finishing. The new list released now required no changes since the company was already adhering to standards.
www.archroma.com
