Five more global fashion brands have assured Bangladeshi exporters they would receive readymade garments that had already been produced and were in the process of being made against their orders.

These brands include Spaanish clothing company Inditex, British multinational retailer Marks & Spencer, French retail company Kiabi and US companies PVH Corp and Target have come forward and have informed us of their decision to take the ready goods along with the goods in production. Earlier, Swedish clothing retail company H&M assured of taking delivery of the already produced garments as well as goods in production.

H&M also said that they would pay for the goods under agreed payment terms and the retailer would not negotiate prices on already placed orders. The retailer would pay for the raw materials which were not used as yet and the payment terms to be decided by end of this week

Rating agency ICRA has stated the COVID-19 outbreak is credit negative for India’s retail industry in the short-term amid shutdown of malls as well as closure of non-essential stores across most states in the country. With consumers forced to defer discretionary spends, revenues and profitability, will be adversely impacted in the short-term, which in turn affect credit profile of the Indian retail industry. While consumer sentiments are likely to remain weak in an adverse economic environment, uncertainty around employment prospects is also likely to result in lower purchasing power.

Lifestyle and fashion retailers, primarily those having higher contribution of apparels, consumer durables, jewellery, accessories and footwear, among others, will be impacted the most because of these restrictions and overall curtailment on the movement of people, resulting in demand pressures over the short-term. However, the food and grocery retailers have witnessed a sudden spurt in demand as consumers have started panic buying around uncertainties of stock-outs and closure of these stores as well,

This impact is however, expected to be mitigated in the long-term driven by healthy demand outlook for the industry supported by favorable demographics, rising disposable income and low penetration of organized retail, said the rating agency.

Many retailers may invoke major clauses in their agreements so that they do not have to pay rentals during this period of shutdown, limiting the impact on their profitability. The present scenario, however, provides a favorable opportunity for e-commerce food and grocery players. The outbreak of the Coronavirus has led to a sharp surge in online grocery retailing as consumers are wary of stepping out of their homes. These platforms are witnessing increased demand not only from the existing consumers, but also from new consumers. This could also possibly alter the way Indian consumers buy groceries and spruce up the adoption of online retailing for groceries.

Cornelia Buchwalder has been appointed the new Secretary General of Cematex, the European Committee of Textile Machinery Manufacturers. Buchwaldehas served on an interim basis since June 2019, following the retirement of Maria Avery, and was elected to the permanent position by the Cematex Board on March 12.

Buchwalder has a wide knowledge of the global textile equipment sector, having managed the Swiss Textile Machinery Association since 2013 and been closely involved in organising participation at the major global trade shows and various international events. Her experience takes in the ITMA exhibitions in Europe at Milan (2015) and Barcelona (2019), as well as three ITMA Asia + CITME fairs, in 2014, 2016 and 2018.

She will continue to combine the two posts as Secretary General of both Swiss Textile Machinery and of Cematex.

Order cancellation by Western countries due to the COVID-19 pandemic spells doom for the garment industry in Asian countries. The Textile Council of Hong Kong, recently has warned that the garment sectors in Bangladesh, Cambodia and China faced particularly grave risks of collapse.

Bangladesh, the second-largest clothing exporter in the world behind only China, has already seen garment orders valued at $2.6 billion cancelled or withdrawn, with more likely on the way. Bangladesh has more than 4,600 garment factories, employing at least 4.1 million people, mostly women, who toil to manufacture shirts, T-shirts, jackets, sweaters, and trousers which are shipped to retailers in Europe, the U.S. and Canada. Ready-made garments accounted for 84.2 per cent of Bangladesh’s total exports (valued at $40.5 billion) for the 2018-2019 fiscal year. Europe received nearly 60 per cent of Bangladesh's garment exports in 2018-19. Meanwhile, Bangladeshi factories are losing an estimated $100 million each day.

Cambodia is also a major garment exporter, has been faced with cancelled orders. More than 10,000 garment workers have already lost their jobs as factories closed. Up to 200,000 people could potentially be laid off. Cambodia's garment industry has about 1 million full-time workers. The EU accounted for about 45% of Cambodia's total garment exports in 2018. Now, not only are Cambodian factories dealing with vanishing orders from the west, but its Chinese textile suppliers have largely shut down operations.

Lesser known to the outside world, Myanmar (formerly Burma) also serves as an increasingly important garment exporter to the west. But, as with Cambodia and Bangladesh, order cancellations by the EU have led to the closure of many Myanmar garment factories.

Bangladesh’s Finance Minister AHM Mustafa Kamal has revealed the country expects to receive $750 million from the IMF and $200 million from the World Bank to support its people, businesses and industries suffering from the COVID-19 pandemic In all, the government expects $1 billion from both these institutions.

The coronavirus stands to wipe out 1.1 per cent of Bangladesh's gross domestic product, as per a projection of the Asian Development Bank (ADB), the minister said.

Remittance sent by migrant workers have kept the economy dynamic to some extent so far, but the flow would see negative impact soon as a significant number of migrant workers have returned to Bangladesh because of the outbreak.

A number of the world’s leading strategy and management consulting firms have been predicting tough times ahead for the global luxury goods industry. The COVID-19 fall-out is expected to cost the sector up to $120 billion in revenues, or more than one third of its $350 billion worth as assessed by, Boston Consulting Group, a global leader for fashion and luxury.

Analysis show the extent global luxury brands rely on the Asian/Asia Pacific market. For example, last year, LVMH derived 37 per cent of its €54 billion in revenues from Asia. Other big brands are exposed to the same or greater degree, such as Bottega Veneta with 53 per cent of its revenues coming from in the region, along with Hermès, Gucci, Burberry Ferragamo and Versace.

Any luxury brands turning to alternative consulting firms in the hope of some bright forecasts are in for the same bad news. BCG’s big-league competitor Bain & Company has suggested a potential year-on-year fall of up to 35 percent for luxury sales, with a more moderate model pegging the decline at between 22 and 25 percent – a loss of around $66 billion to $75 billion according to its assessment framework. But there may be some light at the end of the tunnel.

Bain says, the Chinese market already appears to be on its way to recovery, with consumers returning faster than expected to the luxury stores that have now reopened. Broadly, the firm expects that the Asian region bar Japan will bounce back more quickly than, with slower recoveries expected Japan, Europe and the Americas – markets which will feel the extra pinch from an expected decline in Chinese tourists.

Global retailers, including Adidas and H&M, sparked outrage in Germany recently after announcing they planned to stop paying rent on stores that have been forced to close over the virus crisis. German sportswear maker Adidas, which made a net profit of nearly €2 billion ($3.16 billion) last year, has been hit hard by a slump in China sales and massive store closures. The company, one of Germany's best-known brands, told DPA news agency that it was temporarily suspending rental payments, just like many other companies.

Similarly, Swedish clothing giant H&M would not be paying rent on its roughly 460 closed stores in Germany, telling DPA that it had informed landlords and hoped to find a mutually acceptable solution soon. German shoe store chain Deichmann intends to suspend rent and service charges from next month for the duration of the government-ordered closures. The company expected those with political responsibility to compensate for the lost rental income of the affected parties.

Electronics retailers Saturn and MediaMarkt, as well as Adidas rival Puma, also planned to halt their rent payments for now.

Amid challenging times, Moda, the heart of UK fashion, has decided to push back the date for the show to September. The SS21 edition for the show, which was originally planned for August, will now take place from September 06-08, 2020 at The NEC Birmingham.

This move reflects organiser Hyve Group’s commitment to creating a unified portfolio of UK trade shows, as Moda will now take place alongside leading retail trade show Autumn Fair.

Moda Event Director, Adam Gough says; “After carefully monitoring the situation, and listening to our customers, we have decided to move the SS21 edition of Moda back to September. This decision reflects our commitment to continuing the growth of one of the UK’s longest-standing and best-loved fashion trade shows and it is our hope that both exhibitors and visitors will support this decision.”

He continues; “Like many of you, the Moda team are working from spaces that look a little different – from home offices to shared dining tables. However, we want you to know that our inboxes remain open, and our phones are switched on as we continue to work remotely.”

As part of Hyve Group’s UK-wide initiative, Moda will also be running the #InspiredByKindness campaign. The project, which encourages people to share positive stories and acts of kindness, is designed to keep Moda’s community-feel alive during this difficult time. Moda will be offering their platforms to both brands and retailers, in a bid to support their businesses and share the inspirational work and acts of kindness that have emerged from the current situation.

The heart of UK fashion, Moda is the key meeting place for mainstream fashion, delivering a high quality and cost-effective platform for mid-market brands and ensuring a commercially viable and convenient buying environment for retailers across the UK and Ireland. Bringing together over 1,200 collections under one roof at the NEC Birmingham, to deliver the complete season's overview to over 8,000 visitors annually. The show also brings fashion to life on 16 catwalk shows throughout the three days to inspire buyers and sell brands, alongside a comprehensive retail-focused seminar program, interactive workshops and networking events.

APTMA has appreciated all the positive steps taken by the Government to combat the extremely negative impact COVID-19 is having on Pakistan’s economy. Given that the great majority of export orders have either been deferred or cancelled the entire textile sector is in crisis. Europe and the USA are closed for business. The crisis is further compounded by the fact that industry had entered into contracts for importing cotton, the values of which has fallen from around 80 cents/lb to 50 cents/lb as of today.

Given this grave situation, the government’s steps of deferring loan repayments and speeding up of refunds will fall far short of keeping the industry afloat. This will result in a lot of concerns/companies going bankrupt. The impact on unemployment can only be shielded by the industry for a month or two beyond which will there will be no capacity to retain workers.

Further immediate actions to keep the industry afloat and retain jobs, the government needs to

1. Extend the Debt repayment moratorium to cover interest as well as working capital lines of credit.

2. Reduce the rate of interest for industry to 5 per cent

3. Suspend implementation of 1.5 per cent turnover tax. This is a presumptive tax on profits and as there are no profits possible under the current circumstance it should be suspended/held in abeyance.

4. Zero rating for the sector must be restored. Given the record of FBR and the design of the Sales tax system at least 3 months sales tax gets stuck in the pipeline before it is refunded. As the refund is only reclaimable after exports and exports are not happening, collection of sales tax will only hasten bankruptcies, and usher in a very serious depression. We strongly urge the government to suspend the sales tax regime till normalcy returns.

5. Renegotiate the LNG contracts on favorable terms to reduce the cost of gas in times to come.

6. Get NEPRA to re-determine the tariffs of IPP’s to reflect the actual rates of return thereby reducing circular debt and power tariffs for all the country.

Amid global pandemic outbreak, there comes an encouraging news, for laying down foundation stone on March 29, 2020, for a breakthrough investment Polyester fibre (PET) production with the capacity of 500,000 tons per year in Bayingol Mongolian Autonomous region of Xinjiang.

Local leaders and investors are laying down the cornerstone for 500,000 tons/year PET project

The project would be set up inside Korla Petroleum and Petrochemical Industrial Park in the Korla city under Bayingol Mongolian Autonomous Prefecture (region) in Xinjiang Uygur Autonomous Region.

Xinjiang, a far west region of China is the cotton-richest area, with more than four-fifths of cotton production in the country. As per National Bureau of Statistics report, cotton output of 5.002 million tons in 2019 to represent 84.9 percent of total cotton production in China. The new project is of great significance as, except for a very little amount of viscose fiber production the region doesn’t have manmade fiber manufacturing base here. The pioneer PET polyester project will facilitate Xinjiang’s strategy for largely promoting textile and garment development to provide 1 million jobs.  Xinjiang government had initiated an ambitious scheme several years ago to take full advantage of its cotton resources to boost local economy and employment on this far-west land.

Mr. Wang Hongxin, Chairman of Xinjiang Zhongtai Group, said at the ceremony that Zhongtai Group invested heavily in Bayingol Monglian Autonomous Prefecture with aggregate 10 billion Yuan for caustic soda and its value-chain business in the past years and will invest in another four new projects in 2020, and three of which are to be planted right here for 7.5 billion Yuan in total, as one of the four new investment schedules from the Zhongtai Group, including the pioneer PET polyester project.

Mr. Lu Zhengping, Chairman of Zhongtai Petrochemical Company in Korla city, told reporters at the ceremony that this polyester project is the first PET project in terms of its size and capacity in Xinjiang, we all know that PET is made from purified terephthalate acid (PTA) and ethylene glycol (EG), and Zhongtai Group has its own PTA production for 1.2 million tons per year, and to line up with it, this new project will start with its overall field construction in April and is expected to finish at the end of 2021, with approx. 3.4 billion Yuan in budget. PET project will have 250,000 tons of filament and 250,000 tons of staple. In an estimation of the social and economic effects, the PET project, when completed, will lead to a sale income for 3.76 billion Yuan, VAT contribution for 57 million Yuan every year and provide 600 direct jobs and boost the conjoint downstream sectors, like spinning, weaving, dyeing and printing, for an employment of over 50,000 people.

It is understood that the PET project is a pivot that connects petrochemical industry with textile and apparel industry and its filament and staple will reshape present composition of raw materials that previously relied predominantly on cotton, making it possible for cotton spinning to update to manufacturing variety of fabrics in cotton-cotton/chemical fiber blends and filament weaving diversity, a milestone for transforming textile industry into a refinery-petrochemical-textile integration not only in Korla city in Bayingol Mongolian Autonomous Prefecture, but also in Xinjiang as a whole.

Contributed by Mr. ZHAO Hong 

He is working for CHINA TEXTILE magazine as Editor-in-Chief in addition to being involved in a plethora of activities for the textile industry. He has worked for the Engineering Institute of Ministry of Textile Industry, and for China National Textile Council and continues to serve the industry in the capacity of Deputy Director of China Textile International Exchange Centre, V. President  of China Knitting Industry Association, V. President of China Textile Magazine and its Editor-in-Chief for the English Version, Deputy Director of News Centre of China National Textile and Apparel Council (CNTAC), Deputy Director of International Trade Office, CNTAC, Deputy Director of China Textile Economic Research Centre. He was also elected once ACT Chair of Private Sector Consulting Committee of International Textile and Clothing Bureau (ITCB)