IVC INTRODUCES THE 16TH EDITION OF THE STUDY "THE FIBER YEAR" WITH KEY SECTOR DATA
- Fiber Production for the first Time in five Years lower than Consumption
Fiber processing
Hong Kong (gtai) - Vietnam is one of the main production sites of the clothing industry. Already in recent years the country had attracted buyers from around the world. In 2014 textiles and clothing shared 22% of the total merchandise exports. According to the state owned VINATX in 2015 Vietnam was the fourth largest apparel exporter in the world. The through the FTA with the EU and the Pacific neighbors expected growth requires investment in the supply industry.
In 2015 the Vietnamese garment exports amounted to about USD 27 billion. Estimates of the Vietnam National Textile and Garment Group (Vinatex) show they will increase by 8% in 2016. Nearly USD 30 billion of sector products would then be exported and assure Vietnam a ranking among the four largest exporting countries. The world market however is stagnating. The sector contributes nearly 10% to the industrial added value of the country, 2.5 million people are employed.
As the most important export market remains the United States. According to Vinatex the export to the US rose by 13% in 2015. The group dominates the textile production in the country, including companies like Garment 10, Phong Phu Textile and Garment Corporation, Viet Tien Garment and Hoa Tho Textile and Garment. Vinatex itself exported products worth of USD 3.5 billion, representing an increase of 10%.
TPP promises benefits
The sector has high hopes on the in February 2016 signed FTA Trans-Pacific Partnership (TPP), in which next to the USA, Japan and Vietnam and eleven Pacific Room states arranged added tariff reductions and improved market access. If the ratification process in all countries will be successful, the agreement would enter into force in February 2018. Analysts show that Vietnam would become one of the main winners, among others due to the lowest labor cost in comparison of all other involved countries. The agreement therefore is welcomed by the majority of the population.
Pre-products have to be imported
According to experts the competitiveness of Vietnam will be increased especially in the area of textiles and clothing. About 70% of the textile exports will be delivered to TPP member countries. Despite the annual growth rates of 15 to 20% the value adding in the country remained low. Imports of raw materials and accessories are high and totaled to USD 16.5 billion in 2015. 90% of the 5,028 textile factories in Vietnam (end of 2013) are apparel manufacturers, that mean sewing operations. By contrast there are just four cotton-processing and two synthetic fibers producing companies.
2014 | 2015 | Change | |
---|---|---|---|
Cotton | 1,443 | 1,623 | 12.5 |
Fibers | 1,559 | 1,515 | -2.8 |
Fabrics | 9,428 | 10,197 | 8.2 |
Accessories | 3,031 | 3,193 | 5.3 |
Total | 15,461 | 16,528 | 6.9 |
Source: Vietnam Textile and Apparel Association (Vitas)
The sector is facing a challenge: TPP offers the free imports only if 55% of the value is provided in the member states. For the textile sector this is called the "Yarn Forward Rule", that means everything following the yarn. In Vietnam the proportion of the added value currently stands at 25%.
The text of the agreement is online available: (http://www.tpp.mfat.govt.nz/text). Chapter 4 deals with the textile and clothing sector and contains important annexes to the rules of origin. TPP is expected to attract investments into the country, as the value supply chain is incomplete: yarns and fabrics are mostly imported from East Asian countries.
Value adding rules require investment
Also the free trade agreement between the EU and Vietnam, agreed on August 4th 2015, should push the exchange of commodities. The share of the EU clothing imports from Vietnam is only 3%. Thus the country ranks as the sixth supplier. In the United States, Japan and South Korea Vietnam, however, is the second largest clothing supplier.
Following ratification of TPP an abolishment of 99% of all tariffs would follow. Textiles from Vietnam would then be duty-free within a maximum period of seven years. For that TPP
defines clear rules of origin: (http://trade.ec.europa.eu/doclib/press/index.cfm?id=1437).
If investments would flow into the country and strengthen the supply chain, the value of clothing exports from Vietnam could be doubled until 2020 - so bold estimates. Then the annual production of yarns should reach 2 million tons, the amount of fabrics 2 billion square meters and that of clothing 6 billion pieces. Following the Vietnam Textile and Apparel Association (VITAS) the export value then should be between USD 45 to 50 billion. This requires new textile machinery. So far, mainly Chinese products were in demand, but also for German suppliers the opportunities emerge.
Sector | Annual capacity |
---|---|
Cotton ginning (1,000 t) | 70 |
Synthetic fibers (1,000 t) | 400 |
Filament yarn (1,000 t) | 182 |
Spinning (1,000 t) | 900 |
Weaving (Mio. m²) | 800 |
Knitting (1,000 t) | 110 |
Nonwovens (1,000 t) | 16 |
Dyeing and finishing (Mio. m²) | 1200 |
Toweling (1,000 t) | 62 |
Clothing(Mio. Stück) | 4000 |
Source: Vitas
However, many sector representatives in Vietnam see TPP also critical, because by the agreement large new market participants could intensify competition. The small and medium companies are hardly competitive due to their outdated technology, lack of capital and low know-how. They demand government aid in the form of tax breaks and subsidies for land. The Bank for Investment and Development of Vietnam has already provided USD 2 billion for the support of the industry for the next five years.
Investment in regional centers
Large investments are happening already now: The TAL Group from Hong Kong, one of the largest owner-managed apparel producers, has invested USD 600 million in factories in the Dai An Industry Zone in Hai Duong Province, especially for yarn dyeing and finishing. Haputex Development, which is also from Hong Kong, has built with up to USD 120 million in the province of Binh Duong on a twelve hectare site a Weaving mill which should go into operation 2016. There also the South Korean company Kyungbang is building a spinning mill for USD 40 million. The Texhong Textile and Garment Group is building with USD 300 million a yarn factory in Quang Ninh. And in Nam Dinh the Yulun Jiangsu Textile Group, a state-owned company from China, is building with USD 68 million a factory for the manufacturing and dyeing of yarn.
Investments are mainly attracted by the regions Ninh Binh, Hue, Binh Duong and Ham Dinh, as well as the cost favorable Mekong Delta. New target regions are at the borders with Laos and Cambodia, such as the area Tay Nguyen. As the largest Vietnamese group also Vinatex invests in new capacities and announces in convincing interviews to reach by 2020 a local added value part of 65% in final finished products.
2014 | 2015 | Change | |
---|---|---|---|
USA | 9.841 | 10.984 | 11,6 |
EU | 2.261 | 3.325 | 47,1 |
Japan | 2.092 | 2.163 | 3,4 |
Korea (Rep.) | 2.092 | 2.163 | 3,4 |
Total | 24.692 | 27.021 | 9,4 |
Source: Vietnam Textile and Apparel Association (VITAS)
Contact address:
Vietnam Textile and Apparel Association (VITAS)
2nd Floor, 32 Trang Tien Str., Hoan Kiem District, Hanoi, Vietnam
Tel.: 0084 4/39 36 41 34; Fax: -39 34 98 42
Email: info@vietnamtextile.org.vn; Internet: http://www.vietnamtextile.org.vn
Achim Haug, Germany Trade & Invest www.gtai.de
Prague (gtai) - The Czech textile and clothing industry is still on the upswing. Particularly in niche segments and with technical textiles the manufacturers achieve rising revenues since years. The investment climate in the sector therefore has been improved, the equipment suppliers are benefitting. German manufacturers of machinery for the textile and clothing industry were able to expand their exports to the Czech Republic in 2015 by one fifth.
With Czech Crowns 52.4 billion (Kc; EUR 1.9 bn) the Czech textile industry achieved so much revenue in 2015 as not anymore in the last eight years. According to the statistics office the clothing manufacturers output rose by 11%, that of textile manufacturing by 3%. Very good filled are the order books. For companies in the clothing industry the volume of new orders rose by over 13% in 2015, in the textile factories
by 4%.
According to the announcement of the professional association ATOK, the sector would have developed even better, if the growth markets in Asia and Africa would have not weakened. But fortunately the loss became offset by the traditional markets Germany, Italy, Poland, Slovakia, Austria and France. According to ATOK the textile segment of the Czech Republic exported goods worth equivalent of almost EUR 2.5 billion in 2015, corresponding to a trade surplus of almost EUR 30 million. In clothing, the country recorded a negative balance. Here goods were imported for Euro 2 billion and exported of EUR 1.3 Billion.
Year | Sales in Kc bn. | Change to previous year (in %) |
2007 | 55.0 | 1.5 |
2008 | 46.1 | -16.2 |
2009 | 41.1 | -10.8 |
2010 | 41.3 | 0.5 |
2011 | 46.2 | 11.9 |
2012 | 45.9 | -0.6 |
2013 | 47.1 | 2.6 |
2014 | 51.0 | 8.3 |
2015 | 52.4 | 2.7 |
2007 | 55.0 | 1.5 |
Source: Association of Textile, Garment and Leather Industry (ATOK, http://www.atok.cz)
Particularly in niche segments the clothing manufacturers can maintain themselves in their position. For example Triola from the northern Bohemia Horni Jiretin specializes in lingerie and successfully with oversizes. Also manufacturers like Timo, Pleas, Upavan or Linia can exist with underwear products on the market. According to reports from the business paper Hospodarske noviny Timo sells 200.000 pc. per year. The company offers among others prosthetic lingerie against breat tumors.In the next two years the family operation will invest more than EUR 700,000 in new technologies at the production site Litomerice (North Bohemia).
Hats and hoods are demanded in 30 countries
Another family company, Kama from Prague, specializes in headwear. With hats, scarves, headbands, gloves or hoods it makes now more than EUR 1 million per year and delivers to 30 countries. In Moravia-Silesia Sky Paragliders from Frydlant nad Ostravici invests around EUR 4 million in a weaving mill including a research center to develop new materials. The company produces emergency parachutes and rescue systems and belongs with annual revenues of EUR 2.7 million (2014) to the top ten manufacturers worldwide. It processes 200 kilometers of fabrics annually.
Thanks to favorable wages and the proximity to areas with good purchasing power smaller suppliers of made to measure products developed well. The company Janek from Roznov in Zlin produces,for example, 30,000 individually tailored shirts per year. Also suits and costumes belong to the assortment. Janes buy the yarn from a German yarn manufacturer which produces in the Czech Republic.
Company/location | Product portfolio | Sales 2013 |
Sales 2014 |
Change 1) |
Webseite |
Borgers CS/Plzen | Nonwovens for automotives |
5.038 | 10.879 | 115,9 | http://borgers.cz |
Juta/Dvur Kralovenad Labem | Nonwovens for automotives |
5.568 | 6.618 | 18,8 | http://www.juta.cz |
Nova Mosilana /Brno | Fancy dress fabrics | 2.952 | 3.285 | 11,3 | http://www.novamosilana.cz |
Pegas Nonwovens/Znojmo | Nonwovens | 2.273 | 2.388 | 5,1 | http://www.pegas.cz |
Kordarna Plus/Velka nad Velickou | Corduroy fabrics Technical Textiles for conveyors |
2.195 | 2.287 | 4,2 | http://www.kordarna.cz |
Veba, textilni zavody/Broumov | Home – and Clothing fabrics, Brocat |
2.124 | 2.160 | 1,7 | http://www.veba.cz/cs/ |
Johnson Controls/ Strakonice 2) |
Seatcovers for automotives |
1.722 | 1.865 | 8,3 | http://www.johnsoncontrols.cz |
Fibertex Nonwovens/ Svitavy |
Nonwovens | 958 | 1.128 | 17,7 | http://www.fibertex.com |
Pleas / Havlickuv Brod |
Under – and Nightwear | 1.073 | 1.123 | 4,6 | http://www.pleas.cz |
Mehler Texnologies/ Lomnice nad Popelkou 3) |
Fabrics for tents, boats, canvas, sunumbrellas |
895 | 975 | 8,9 | http://www.mehlertexnologies. cz |
Nejdecka cesarna vlny/Nejdek 4) |
Processing of rawwool | 800 | 692 | -13,5 | http://www.ncv.cz |
Lanex/Bolatice | Ropes, threats, artificial turf |
627 | 670 | 6,7 | http://www.lanex.cz |
Trevos/Kostalov | Polypropylen- Staple-fiber |
576 | 639 | 10,9 | http://www.monticekia.cz |
Tessitura Monti Cekia/ Borovnice u Stare Paky |
Cotton shirt fabrics | 609 | 568 | -6,7 | http://www.monticekia.cz |
Svitap J.H.J./Svitavy | Tents, canvas, Microfibers, Filtration |
497 | 436 | -12,3 | http://www.svitap.cz |
1) Change 2014 / 113 in%; 2) Fiscal year October 2012, 2013 till September 2013, 2014; 3) December 2012, 2013 till November 2013, 2014; 4) April 2013, 2014 till March 2014, 2015
Sources: Annual company reports, Trade register, Hospodarske noviny, Magazine Ekonom, CzechInvest, Association ATOK
The most actively trading companies in the textile sector are producing mostly for industrial consumers. Largest industry representative is the automotive supplier Borgers from Bocholt, which produces textile moldings, paneling, insulation and curtains for vehicles at four locations near Plzen. The second largest textile company Juta achieves half of its revenue from construction materials such as drainage mats, erosion control fabric or roof insulation. Moreover Juta makes a good business with packaging nets for potatoes or Christmas trees. One other growth area is artificial turf. The company invests nearly EUR 20 million every year, mainly in new production equipment.
Textile Machinery ordered for 250 m Euro
Other companies are expanding too. The manufacturer of workwear Waibel has expanded its site in2015. In Zdar nad Sazavou near Jihlava own collections and custom made programs are being manufactured. Clothing manufacturer Pleas invests annually over EUR 1 million in its equipment. The company belongs to the top 10 of the sector and produces annually 15 million pieces nightwear for the brands Schiesser and Pleas. The German machinery manufacturer Mayer & Cie. builds a factory for knitting machines in Vsetin. The production is expected to comence in summer 2016. The machines are designed for large manufactures particularly in Asia.
Maschinery group / HS-Position | 2014 | 2015 | Veränderung in % |
Jet-spinning machines / 8444 | 177 | 15.369 | 8.583,1 |
..from Germany | 59 | 9.829 | 16.559,3 |
Spinning machines / 8445 | 12.780 | 8.838 | -30,8 |
..from Germany | 6.591 | 5.017 | -23,9 |
Weaving machines / 8446 | 13.357 | 12.778 | -4,3 |
..from Germany | 7.498 | 2.166 | -71,1 |
Knitting machines / 8447 | 10.556 | 11.332 | 7,4 |
..from Germany | 2.872 | 6.092 | 112,1 |
Auxiliary machines / 8448 | 75.082 | 72.178 | -3,9 |
..from Germany | 48.245 | 51.765 | 7,3 |
Machines for felting and nonwovens / 8449 | 3.349 | 16.306 | 386,9 |
..from Germany | 949 | 6.741 | 610,3 |
Cleaning-, dying and ironing machines / 8451 | 83.874 | 105.825 | 26,2 |
..from Germany | 44.671 | 50.234 | 12,5 |
Sewing machines / 8452 | 14.718 | 17.834 | 21,2 |
..from Germany | 4.780 | 6.319 | 32,2 |
Machines for leather and fur processing resp. footwear production / 8453 |
2.867 | 3.704 | 29,2 |
..from Germany | 278 | 347 | 24,8 |
Total | 216.760 | 264.164 | 21,9 |
..from Germany | 115.943 | 138.510 | 19,5 |
Source: Czech Statistical Office
Trade Development Authority of Pakistan (TDAP), Government of Pakistan is organizing the first ever textile exhibition named TeXpo 2016 from 7-10 April 2016 at Karachi Expo Center.
Objective of this exhibition is to present the potential of textile sector exports, especially value added sectors: readymade garments, knitwear, hosiery, bedsheets, textile madeups, sportswear, towels, textile accessories, etc.
The textile sector of Pakistan
Pakistan is the 4th largest producer and 3rd largest consumer of cotton globally. Textiles is the vital manufacturing sector of Pakistan. It contributes nearly one-fourth of industrial value-added, provides employment to about 40% of industrial labour force, consumes 40% of banking credit to manufacturing sector and accounts for 8% of national GDP. Textile products share in national exports is 54%.
The textile industry consists of 11.3 million spindles, 3 million rotors, 350,000 power looms, 18,000 knitting machines and processing capacity of 5.2 billion sqm. It has 700,000 industrial and domestic stitching machines. In addition, it has a strong fiber base of 13 million bales of cotton and 600,000 tons of manmade fibers including polyester fiber. There are 21 filament yarn units having capacity of 100,000 tons. The filament and yarn industry is supported by PTA plant which has 500,000 tons capacity. Thus a complete textiles value chain exists in the country which is rare in the world, unlike many competitors which have only primary base or the finished base.
Source: Ministry of Textile Industry, GoP
Pakistan’s textile exports to Germany
Pakistan enjoys zero customs duty access to European Union including Germany on textile products under GSP Plus Scheme. The scheme started in 2014 and the duty preference to Pakistan will continue for another 8 years. As a result of this incentive, Pakistan’s exports to European Union have increased by almost US$ 2 Billion in two years and the main beneficiary of the scheme has been the textile sector. This increase in exports shows the European buyers confidence in the manufacturers and exporters from Pakistan.
Especially with Germany, Pakistan’s exports in textile products have been increasing by 20% every year. The table below shows Pakistan’s exports to Germany, in textile products:
2013 | 2014 | 2015 | 2015 | % Inc/ Dec in 2015 over 2014 - 11 Months |
|||||
(January - November) | (January - November) | (January - November) | (January - November) | ||||||
EUR (‘000) | USD (‘000) | EUR (‘000) | USD (‘000) | EUR (‘000) | USD (‘000) | EUR (‘000) | USD (‘000) | EUR | |
cotton | 115.451,00 | 153.353,00 | 109.190,00 | 145.456,00 | 101.111,0 | 135.491 | 113.799,0 | 126.692 | 13% |
Man-made staple fibers | 16.135,00 | 21.367,00 | 16.959,00 | 22.432,00 | 15.387,0 | 20.499 | 16.432,0 | 18.274 | 7% |
Carpets, floor covering made of textile materials | 11.127,00 | 14.797,00 | 12.545,00 | 16.565,00 | 11.119,0 | 14.807 | 10.919,0 | 12.173 | -2% |
Knitwear | 135.428,00 | 180.080,00 | 176.123,00 | 233.634,00 | 161.014,0 | 215.001 | 206.988,0 | 230.339 | 29% |
Ready made garments (Woven) | 266.450,00 | 353.495,00 | 334.446,00 | 444.604,00 | 311.214,0 | 415.95 | 405.924,0 | 451.166 | 30% |
Home textiles (incl. Bedwear and towel) | 176.440,00 | 234.265,00 | 236.164,00 | 313.190,00 | 214.074,0 | 285.953 | 215.308,0 | 239.699 | 1% |
Total of 6 items | 721.031,00 | 957.357,00 | 885.427,00 | 1.175.881,00 | 813.919,00 | 1.087.709,00 | 969.370,00 | 1.078.343,00 | 19% |
Major Commodities | Value in US$ thousand July-June 2014-15 |
Value in US$ thousand July-June 2013-14 |
|
Textile Group | 13.164,027 | 13.433,644 | |
1 | Cotton Cloth | 2.452,632 | 2.769,986 |
2 | Knitwears | 2.406,488 | 2.293,668 |
3 | Cotton Yarn | 1.849,389 | 1.997,338 |
4 | Bed Wear | 2.103,071 | 2.137,744 |
5 | Readymade Garments | 2.095,089 | 1.909,323 |
6 | Towels | 797,155 | 767,461 |
7 | Art Silk And Synthetic Textiles | 330,584 | 384,964 |
8 | Textile Made Ups (excl. Towels & Bed Wear) | 654,926 | 659,929 |
9 | Raw Cotton | 147,060 | 205,136 |
10 | Kintted or Crochated Fabrics | 36,177 | 34,974 |
11 | Cotton Waste | 51,050 | 79,122 |
12 | Yarn other than Cotton Yarn | 42,828 | 43,873 |
13 | Tents & Other Canvas Goods | 126,575 | 77,759 |
14 | Waste Material of Textile Fibres/Fabrics | 28,042 | 24,451 |
15 | Tule, Lace, Embroidery Etc | 12,515 | 15,567 |
16 | Cotton Bags/Sacks | 13,138 | 11,677 |
17 | TEXTILE FABRICS WOVEN (Other than Cotton & Artificial Fabrics) |
3,726 | 3,698 |
18 | Cotton Thread | 12,259 | 15,123 |
19 | Textile For Machinery | 1,323 | 1,851 |
Source: TDAP R&D Cell
Texpo – An opportunity to expand sourcing and increase Profits
The exhibition – Texpo provides and a unique opportunity for the buyers from Germany to meet new suppliers of the textile products and visit their manufacturing facilities.
The Government of Pakistan, Trade Development Authority of Pakistan will arrange accommodation for the visitors/ guests from all over the world, in the top hotels in Karachi city. Free accommodation will be provided for the guests registered through Pakistan Embassy at Berlin or the Consulate at Frankfurt am Main. A few select guests will also be offered air ticket subsidy depending on the confirmation from the organisers.
Local transport in Karachi city with complete security for the delegates will be arranged by the Government of Pakistan to further add to the comfort of guests from all over the world.
You can also plan your visit to China and other regional suppliers near Karachi right after Texpo.
For further details, please contact:
1. Mr. Rizwan Tariq
Commercial Counsellor Consulate General of Pakistan, Frankfurt am Main
Ph: +49 69-6976970
Cell: +49 176-31363223
Email: pakcom.frk@tdap.gov.pk
2. Mr. Matthias Theis
Honorary Consul of Pakistan for the state of NRW Dusseldorf
Ph: +49 211 4407227
Email: office@pakistan-nrw.de
3. Mr. Rainer Borch
Trade Development Officer Embassy of Pakistan Berlin
Ph: +49 30-21244145
Cell: +49 163-3736036
Email: tdo@pakemb.de or rainer.borch@aol.de