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26.02.2019

TURKEY REMAINS AN IMPORTANT MARKET FOR GERMAN TEXTILE MACHINERY

  • Competition from the Far East increases modernization pressure

Turkey is an important market for German manufacturers of textile machinery. However, the textile and clothing industry has a problem: exports have been stagnating for years.

  • Competition from the Far East increases modernization pressure

Turkey is an important market for German manufacturers of textile machinery. However, the textile and clothing industry has a problem: exports have been stagnating for years.

The Turkish textile industry is broadly based: Companies manufacture all intermediate products in the country, including yarns, fibers and fabrics. Production along the entire textile value chain means great sales potential for German suppliers of textile machinery. In fact, Turkey is the second most important export market for German spinning, weaving, textile finishing machines and the like after China, as it can be seen from the figures of the Federal Statistical Office Destatis.Nevertheless, the sector is not a growth market. Apart from a few outliers upwards and downwards, Turkish textile machinery imports have remained at the same level for several years. This is due to the fact that Turkish exports of textiles and clothing are also stagnating. Particularly noticeable: companies benefited only marginally from the weak lira last year.

Textile and apparel industry benefits little from weak lira
Year Turkish exports of clothing and textiles (in US$ billion) Annual change (in %)
2015 26.3 -10.3
2016 26.1 -0.6
2017 26.7 2.1
2018 27.7 3.6

Source: Turkish Statistical Office TÜIK (http://www.tuik.gov.tr)

Increasing pressure from the Far East
Turkish clothing manufacturers are increasingly feeling the effects of competition from the Far East. Despite the high number of informal workers, wages in Turkey have risen to such an extent that they cannot keep up with the low wages of Asian sewing factories. The geographical advantage of Turkish companies over Chinese competitors is at stake because of the new Silk Road and the development of faster transport routes. Free trade agreements that the European Union is currently negotiating with India and South Korea will further increase the pressure on Turkish producers.

Slump in 3rd quarter 2018
In addition, there is the difficult economic situation in the country: the Turkish lira reached a record low, especially in the months of August to October 2018, and commercial banks raised their lending rates. As a result, financing costs for machinery from abroad suddenly increased, orders from Turkey failed to materialize, especially in the third quarter. The German knitting machine manufacturer Mayer & Cie has also noticed this, as Stefan Bühler, who is responsible for the Turkish business, reports: "In the last three months of 2018, the market was virtually dead. In the meantime, however, the industry is gradually recovering.

Akar Textile plans new factory
Announcements about new investments cannot yet be heard at this time. As early as June 2018, Akar Textile (http://www.akartextile.com) announced that it would build a new factory for 47 million Turkish lira (TL) in the municipality of Savur in southeastern Turkey. 3,000 employees are there to become employed. Akar Textile produces for companies such as C&A, Mango and H&M. Only a few months after the announcement of the project, the economic crisis in Turkey deepened in September. The extent to which the turbulence has affected the project implementation is not known.

Technical textiles as a driving force for growth
Far Eastern competition is increasing the pressure to modernize the Turkish textile industry. In the future, industry will have to compete primarily with high-quality products. Growth impulses are currently coming from the sector of technical textiles. According to industry reports, more than 200 small and medium-sized enterprises are already producing technical textiles and nonwovens in Turkey. These textiles and fabrics are being used in the automotive, packaging and cosmetics industries.

In June 2018, the Turkish METYX Group (http://www.metyx.com) invested in its machinery parc. The company is manufacturing technical textiles and has ordered a line of warp knitting machines from the German textile machine manufacturer Karl Mayer. The manufacturer of composite materials is thus increasing its capacity by 12,000 tons of glass and carbon fibers. In recent years, more and more research and development centers have emerged to promote the necessary technology transfer in the industry. The Institute for Technical Textiles at RWTH Aachen University (ITA) founded a research center in Istanbul in October 2016. In the Teknosab industrial zone in Bursa the BUTEKOM research and development center for textile technology was established in 2008. The institute offers training as well as research and development cooperation to and with companies.

However, many medium-sized textile companies often lack the money to invest in modern machinery. The short planning horizon makes an access to research and development more difficult. As a member of the management board of the German-Turkish Chamber of Industry and Commerce, Frank Kaiser has been observing the Turkish business landscape for eight years. He points out that the textile manufacturers, like other medium-sized companies in the country too, often plan in short terms. "In view of the volatile business environment, this is rational," Kaiser explains.

Turkish imports of textile machinery and exchange rate comparison  1)
Year Import from Germany
(in USD million)
Total imports
(in USD million)
Exchange rate
(1 US$ = ?TL)
2009 143 505 1.55
2011 521 1,851 1.67
2013 619 2,211 1.90
2015 382 1,398 2.72
2017 447 1,478 3.65
2018 1) 2) 490 1,774 4.81

1) the slump in the 3rd quarter is not yet visible in the annual figures for 2018; it will not become noticeable until 2019
Sources: UN-Comtrade, TurkStat 2), Bundesbank

 

 

 

 

Foto: PIXABAY
19.02.2019

DOMINICAN REPUBLIC REMAINS DIFFICULT MARKET FOR GERMAN TEXTILE MACHINERY

  • Deliveries have risen sharply recently

Cheap and used technology dominates at the Dominican market for textile machinery. It is some of the country's problems that give German suppliers some hope.

The good news is that in the first eleven months of 2018 German exports of textile and clothing machinery to the Dominican Republic rose by 580 percent year-on-year, and, according to Eurostat, by 2017 German deliveries had tripled. The bad news: German sector exports reached only EUR 1.7 million in absolute terms. This is considerably less than, for example, in Guatemala with its not much larger technology market.

  • Deliveries have risen sharply recently

Cheap and used technology dominates at the Dominican market for textile machinery. It is some of the country's problems that give German suppliers some hope.

The good news is that in the first eleven months of 2018 German exports of textile and clothing machinery to the Dominican Republic rose by 580 percent year-on-year, and, according to Eurostat, by 2017 German deliveries had tripled. The bad news: German sector exports reached only EUR 1.7 million in absolute terms. This is considerably less than, for example, in Guatemala with its not much larger technology market.

Representatives of German providers are not surprised about the figures. Cheap equipment from China and other Asian countries are in demand, but above all mainly used machines. Hugo Clavijo of Texquim, who represents the German suppliers Mayer & Cie. (circular knitting machines) and Groz-Beckert (needles), among others in the Dominican Republic, estimates, that just five out of every hundred machines sold are new. Around the turn of the millennium, the market thus became the residual ramp for the declining US textile industry. According to UN Comtrade, around 60 percent of the value of technology deliveries in recent years came from the USA.

The International Textile Manufacturers Federation also registered hardly any shipments of new machines: for 2010 to 2017, the ITMF shows just ten flat knitting machines and eleven (all in 2017) circular knitting machines. Also, for this period 720 Double Heaters for texturing synthetic filaments for yarn production were listed. The ITMF counts the deliveries of 200 textile machinery manufacturers worldwide and thus a large part of the market, albeit not the entire one.

Electricity and water bottlenecks as arguments for expensive machines
Hugo Clavijo currently sees no great chance of a rapid improvement in the sale of expensive German technology. But ironically, it is some of the country's problems that may transform the potential customer interest into concrete procurements: The energy supply for the textile companies is expensive and unreliable, and the companies have to treat their process water themselves. Economical and less repair-prone machines would come into a closer consideration even if the purchase prices were significantly higher. It would also be helpful to enforce environmental standards, which today are largely on paper only.

There is also a need for technology if the Dominican textile and clothing manufacturers expand their capacities due to possible changes in international trade policy, i.e. if clothing customers in the USA would place orders in the Caribbean country instead of Asia. At the moment, however, the Dominican export industry is not using its factories to capacity.

Installed capacity of the Dominican textile industry in comparison (2016, in units) 1)

Machinery / technology Dominican Republic Guatemala Ethiopia Turkey
Rotor Spinning 2) 1,400 21,000 19,000 800,000
Short Staple Spinning 2) 20,000 150,000 293,852 7,900,000
Shuttle Looms 3) 500 3,000 167 20,000
Shuttleless Looms 3) 150 890 2,200 49,500

1) no data on other machines; 2) spinning machines; 3) weaving machines

Source: International Textile Manufacturers Federation

The Dominican textile and clothing industry, which, according to the central bank, generated 11 percent of the country's total export revenues with clothing from free zones in 2017, is not fully vertically integrated: it mainly imports yarns, which then is mainly being knitted but also woven or otherwise processed and then assembled into finished clothing. It often produces T-shirts and other knitwear with a high cotton content. And this is "the cheap stuff," as Clavijo says.

There is a limited production of synthetic yarn in the Dominican Republic which, according to Hugo Clavijo, is limited to two companies: The Korean company Youm Kwang textures filaments in the country, while the US company A&E (American & Efird) produces sewing thread from imported filaments.

Four export producers as important technology customers
The Dominican textile sector is said to consist of about two equal segments. A dozen medium-sized companies and a large number of garage companies supply the domestic market. In addition, four companies produce for export in the country's free zones: Gildan (Canada), Hanes (USA), Willbes (Korea) and the local Grupo M, which has been working in a 50/50 joint venture with Brandix from Sri Lanka since the beginning of 2017. The procurement of machines in foreign companies is not decided by the local management, but by the corporate headquarters, according to representatives.

The four export producers are said to be vertically integrated from yarn processing onwards. Grupo M supplies about one fifth of its fabrics, knitwear, etc. to processors, while the other three industry giants manufacture these preliminary products completely by themselves. According to Comtrade (SITC chapter 84), three quarters of the clothing exports go to the USA, the remainder predominantly to the neighboring Haiti.

For US clothing customers, the nearby Dominican Republic offers fast and cheap transport routes as well as the advantageous customs regime of the DR-CAFTA trade agreement. According to Hugo Clavijo, however, Dominican clothing exporters must obtain their intermediate products from the USA in order to benefit from all customs relief. Producers for the Dominican domestic market, on the other hand, are using yarns and fabrics from China, Pakistan or other third countries that offer lower production costs.

USA dominate machine deliveries
The Dominican market for textile and clothing machinery has stagnated in recent years: For 2017, UN Comtrade estimated imports - there is no significant domestic production - at USD 36 million. That was as much as 2014 and around USD 10 million more than around 2010.

According to Comtrade, Germany was ranked sixth in the import ranking with an average share of 2.0 percent between 2015 and 2017. Eurostat, whose (export) data deviate considerably in some cases, noted stagnating industry deliveries from the European Union to the Dominican Republic for the first eleven months of 2018 in addition to the high growth for Made in Germany.

Dominican imports of textile machinery (USD thousand *)
ITC-Pos. Supplying country/ Goods Group 2015 2016 2017
  total 33,398 30,817 36,257
724.35, .39 Sewing machines (excluding domestic sewing machines) 12,131 10,350 12,784
7244 Spinn- and texturing machines 2,852 2,102 4,585
7245 Knitting and weaving machines 3,362 2,683 1,543
7246 Auxiliary machines 6,068 5,215 5,384
724.73, .74 Washing machines, stenter frames, etc. (except for housholds and landries), large-dryers 5,135 5,615 7,652
724.92 Parts for items 724.73 and .74 and for dry-cleaning machines (724.72) and domestic tumble dryers 3,850 4,852 4,309
  Supplying countries      
  USA 22,000 17,320 20,743
  China 3,424 3,058 2,380
  Spain 2,176 2,567 2,614
  Japan 973 1,894 2,688
  Italy 923 1,194 496
  Germany 397 724 873

*) SITC 724 without household sewing machines (724,33), household washing machines (724,.71), machines for dry cleaning (724.72), leather processing (7248), parts of household washing machines (724.91).
Source: UN Comtrade.

 

More information:
GTAI
Source:

Ulrich Binkert, Germany Trade & Invest www.gtai.de

12.02.2019

TECHNICAL TEXTILES ARE A SUCCESSFUL INDUSTRY IN ISRAEL

  • Israeli Manufacturers with increasing Presence on the World Market

The production of technical textiles is one of the leading sectors of the Israeli textile industry. Their success is not least due to intensive research and development. In view of the fierce international competition facing the Israeli textile industry, high-quality and innovative products are indispensable for stabilizing this
industry. One of the sectors that best manage this modernization is the production of technical textiles.

In 2017, this product category accounted for an estimated USD 600 million or nearly one-third of the total sales generated by the textile and apparel industry. With an export share of around 70 percent, the division is also strongly world market-oriented and accounted for USD 414 million, 43 percent of Israeli textile and clothing exports in 2017.

  • Israeli Manufacturers with increasing Presence on the World Market

The production of technical textiles is one of the leading sectors of the Israeli textile industry. Their success is not least due to intensive research and development. In view of the fierce international competition facing the Israeli textile industry, high-quality and innovative products are indispensable for stabilizing this
industry. One of the sectors that best manage this modernization is the production of technical textiles.

In 2017, this product category accounted for an estimated USD 600 million or nearly one-third of the total sales generated by the textile and apparel industry. With an export share of around 70 percent, the division is also strongly world market-oriented and accounted for USD 414 million, 43 percent of Israeli textile and clothing exports in 2017.

The production of technical textiles is based not least on strong domestic demand. The largest domestic customers include the armed forces and security forces, which demand high functionality and top quality from their suppliers. Among other things, this market segment produces bulletproof textiles, special textiles for uniforms, carrier bags for sensitive devices under field conditions and camouflage nets.

Strong domestic demand helps product development
As the Fashion & Textile Industries Association explained to Germany Trade & Invest in January 2019, direct contact with the military and internal security institutions helps companies to offer tried and tested products. In addition, according to Maya Herscovitz, director of the association, former members of the armed forces and security forces who are familiar with the requirements for corresponding products are active in the manufacturing companies.    
 
Other domestic customer industries are construction and agriculture. Building construction is increasingly relying on modern building materials, including lightweight and highly insulating textiles. The agricultural sector, on the other hand, contributes only 1.2 percent to the gross domestic product, but is capital-intensive and innovation-oriented. Safety nets are a popular agrotechnical product. In September 2018, Israeli agronomist Yossi Ofir pointed out in a contribution that climate change is leading to an increasing use of shadow nets. Last but not least, more and more Israeli farmers covered entire orchards with shade nets. 

Networking with the high-tech industry
The anchoring in the domestic market and the direct contact to customers accelerate the development of new products. At the same time, the technical textiles sector is embedded in the high-tech scene. For example, manufacturers integrate research results from nanotechnology and materials science into their products.

An example of this is Marom Dolphin, which manufactures military and civilian products and uses plastics, metal and composite materials to increase the strength of its textile products or reduce their weight. A leading manufacturer of technical textiles is Hagor Industries, which offers combat vests, protective vests, backpacks and tents of all sizes among other things, while Source - Shoresh produces textile hiking accessories. These and similar manufacturers are represented on numerous export markets.

Some companies do not offer finished products, but technological solutions. Nano Textile, for example, has launched an antibacterial sonochemical coating for textiles. Hospitals are planned as a main field of application, but according to company information other fields of application such as aircraft construction and public transport, restaurants and hotels or baby clothing may also open up. Gideon Guthrie Technical Textile also offers research and development (R&D) services in cooperation with Israeli and foreign textile manufacturers.

In addition to the activities of the company's own R&D departments, research is also carried out at universities. For example, the textile coating technology used by Nano Textile was developed at the Israeli Bar Ilan University. The Shenkar College of Engineering, Design and Art is home to CIRTex (The David & Barbara Blumenthal Israel Center for Innovation and Research in Textiles). The center carries out applied research on new products, production processes and applications for textiles and promotes cooperation between established companies on the one hand and start-ups and individual inventors on the other. Industrial textile research and development is supported by the Innovation Authority.

According to the trade association, the production of technical textiles will continue to increase in the coming years. As Maya Herscovitz explained to Germany Trade and Invest, manufacturers of technical textiles invest large amounts not only in the development of new products, but also in the modernization and automation of production processes. This was not only necessary for reasons of cost savings, but also because of the shortage of skilled workers on the labour market.

Israel is a net exporter of technical textiles
Der mit großem Abstand wichtigste Exportposten im Bereich technischer Textilien (SITC 657) sind The by far most important export item in the technical textiles sector (SITC 657) are nonwovens (SITC 657.2). They accounted for 67.1 percent of total exports of technical textiles in 2017, or USD 278 million. Second place went to batting, wicks and goods and products for technical use made of textile materials. With an export value of USD 88 million, they accounted for 21.6 percent of industry exports.

The most important export market in 2017 was the USA, followed by the Netherlands and Germany in a great distance. The Federal Republic of Germany purchased technical textiles worth USD 44.7 million (10.8 percent of Israeli exports) from Israel.

With USD 136 million imports accounted for 32.6 percent of exports. The three most important supplier countries - China, Turkey and Italy - were almost on a par at USD 25 million, USD 24.8 million and USD 24.2 million. Germany ranked fifth and, with a delivery value of USD 11.2 million, achieved an import market share of 8.3 percent.

Source:

Wladimir Struminski, Germany Trade & Invest www.gtai.de

Photo: PIXABAY
11.12.2018

AZERBAIJAN'S TEXTILE AND SILK PRODUCTION IS ABOUT TO RESTART

  • Industrial park under construction

Baku (GTAI) - The Azerbaijani textile and silk industry is going to have a future again after a dramatic slump. Several initiatives are helping the traditional industry to make a fresh start.

Azerbaijan wants to revive its once strong textile, silk and clothing industry. In 1990, the sector still accounted for just under 18 percent of the total industrial production – in 2017 it was just 0.5 percent. Future investment activities will be determined by several initiatives. These include the implementation of programs for the production and processing of cotton and silk cocoons for semi-finished and finished goods, the establishment of an industrial park for light industry in Mingatchevir and the establishment of branches of the Azerkhalcha company for hand-woven carpets.

  • Industrial park under construction

Baku (GTAI) - The Azerbaijani textile and silk industry is going to have a future again after a dramatic slump. Several initiatives are helping the traditional industry to make a fresh start.

Azerbaijan wants to revive its once strong textile, silk and clothing industry. In 1990, the sector still accounted for just under 18 percent of the total industrial production – in 2017 it was just 0.5 percent. Future investment activities will be determined by several initiatives. These include the implementation of programs for the production and processing of cotton and silk cocoons for semi-finished and finished goods, the establishment of an industrial park for light industry in Mingatchevir and the establishment of branches of the Azerkhalcha company for hand-woven carpets.

New projects in cotton processing on the horizon
At the beginning of the 1980s, cotton cultivation boomed in the country with an annual harvest of more than 1 million tons of raw cotton. The collapse of the Soviet Union, the transformation crisis in the 1990s and general neglect almost brought the industry to a standstill. In 2015, the harvest reached a historic low of 35,000 tons of raw cotton.

But the turnaround has begun. In 2017, 207,000 tons of raw cotton were harvested (forecast for 2018: 250,000 to 260,000 tons). A downer is the low average yield of 1.52 tons per hectare (2017). The government announced increased support for soil irrigation and technical equipment for manufacturers. By 2022 the harvest is expected to rise up to 500,000 tons per year.

The "State Program for the Development of Cotton Growing in the period 2017 to 2022" adopted on July 13th 2017 is a guideline for the further development. Projects are planned for the renewal of existing and the construction of new cotton ginning mills and processing of cotton fibers into yarns, fabrics and finished products. By mid-2018 there were eight spinning mills in the country with a total annual capacity of 44,600 tons of yarn. Above all among the yarn producers in Uzbekistan are the companies Mingatschewir Textil, MKT Istehsalat Kommersiya, ASK Textil Sumgait and Azeripek (better known as Ipek Scheki).

Silk industry to be expanded
Since 2016 the silk industry, which came almost to a standstill, has now been on the move again. On November 27th 2017 the "State Program for the Development of Silkworm Breeding and Processing of Mulberry Silkworm Cocoons for the period 2017 to 2025" was adopted. The program defines projects to revitalize the sector. The annual production of cocoons is expected to rise to 6,000 tons by 2025, ensuring an annual production of up to 600 tons of raw silk. In 2017 244 tons of cocoons were produced after 71 tons in 2016 (forecasts for 2018 and 2019: about 500 and 1,000 tons respectively).

The modernization of the silk combinate Azeripek in Scheki is at the top of the project list. The contact organization is the Azerbaijan State Industrial Association, to which Azeripek and other companies are reporting (http://www.ask.gov.az). The construction of a new silk spinning mill with an annual capacity of 3,000 tons of yarn is planned.

Established in 1931 and later expanded the Silk Combine in Scheki was the flagship of the silk industry in the Soviet Union in the 1970s and 1980s with some 7,000 permanent employees. It produced up to 400 tons of raw silk per year and supplied over 100 factories with silk yarn and twist. Inefficient privatization, financial problems, lack of raw materials and sales difficulties repeatedly led to production stoppages. Today's capacities allow an annual production of up to 135 tons of raw silk only. As a result of technical problems, the factory is unable to produce finished fabrics.

Industrial park for light industry under construction
In the in 2016 established Industrial Park for Light Industry in Mingatchevir, nine factories for the production of textile and clothing products (cotton, acrylic and wool yarn, hosiery and apparel) and other light industry products (leather footwear and cosmetics) are to be built. The construction of more production facilities is planned. In February 2018 the company Textile Mingatchevir opened the first two factories in the industrial park. It intends to produce up to 20,000 tons of cotton and blended yarn annually. Capital expenditures were USD 46 million.

Azerkhalcha revives traditional carpet art
Azerkhalcha, the company for the production of hand-woven carpets, has an ambitious goal: 30 regional carpet weaving mills are to be established by 2020. By the end of 2017 ten branches have already been opened. A further 20 will be added in 2018 and 2019. Azerkhalcha was founded in 2016 on the initiative of the government. In 2018 and 2019, the state will invest around USD 22 million in the construction of new branches and a wool processing factory.

From 2020, approximately 5,000 employees will produce hand-woven carpets under the Azerbaijan Carpet label for domestic and foreign markets. The expansion plans for the production of hand-woven carpets result from the in 2018 adopted state program for the development of carpet art in Azerbaijan and the Nakhichevan Autonomous Republic for the years 2018 till 2022.

Azerbaijan offers opportunities as a production location
Azerbaijan can score with some advantages as a production location for the textile and silk industry as well as for the clothing industry. These include a sufficiently available and quickly trained labor force, low wage costs, tax and other preferences in industrial areas and good conditions for the sale of the goods.

Good sales opportunities result from the free trade agreements with the countries of the Commonwealth of Independent States and the export opportunities to Turkey. No import duties have to be paid for exports to these countries. Clothing manufacturers from EU countries with the intention of exporting to these countries can benefit from this. Several companies, especially from the Baltic States, are currently exploring their opportunities for a market entry.

The Azerbaijan Textile Industry Association sees a need for action on the part of the government with regard to the framework conditions for the domestic clothing manufacturers. For example, the tariff burden on imports of accessories such as adhesives, buttons and snap fasteners and zippers should significantly be reduced.

Leading manufacturers of apparel and other finished textile products include Baku Textile Factory (Baki Tekstil Fabriki), Accord Textil (Agstafa, part of the Accord Industrial Holding), Alyans Tekstil (Sumqayit), the apparel factory in the Gilan-Textile Park (Sumqayit), and Debet Uniform (Baku). The factories mainly produce workwear and outerwear.

More information:
GTAI Aserbaidschan Carpets
Source:

Uwe Stohbach, Germany Trade & Invest

www.gtai.de

PIXABAY
04.12.2018

CLOTHING INDUSTRY IN CAMBODIA WITH UNCERTAIN OUTLOOK

  • Exports rise in the country's most important industrial sector.

Phnom Penh (GTAI) - Cambodia's clothing exports are growing steadily. However, two factors cloud the prospects for the future.

Cambodia's garment industry is the backbone of the Kingdom's export-oriented economy. Industry exports account for around 40 percent of the gross domestic product (GDP). More than 800,000 Cambodians are employed in over 800 companies. That is more than 85 percent of all factory workers in the country.

Apparel and footwear exports reached USD 8.0 billion in 2017, according to Cambodian customs. This represented an increase of 9.6 percent compared with 2016. Proud growth rates between 7 and almost 15 percent were already achieved in previous years. GTAI estimates on the basis of partner countries' imports an even higher export volume of around USD 12 billion.

  • Exports rise in the country's most important industrial sector.

Phnom Penh (GTAI) - Cambodia's clothing exports are growing steadily. However, two factors cloud the prospects for the future.

Cambodia's garment industry is the backbone of the Kingdom's export-oriented economy. Industry exports account for around 40 percent of the gross domestic product (GDP). More than 800,000 Cambodians are employed in over 800 companies. That is more than 85 percent of all factory workers in the country.

Apparel and footwear exports reached USD 8.0 billion in 2017, according to Cambodian customs. This represented an increase of 9.6 percent compared with 2016. Proud growth rates between 7 and almost 15 percent were already achieved in previous years. GTAI estimates on the basis of partner countries' imports an even higher export volume of around USD 12 billion.

More than 70 percent of the country's total exports of goods regularly come from the sector. Shoes accounted for exports of USD 873 million (+14.4 percent) in 2017. Foreign business with shoes has been improving for some years now and has been able to increase its share of exports to over 10 percent. With an unchanged share of 46 percent compared to the previous year, the EU continued to play a major role among the customers in 2017, followed by the USA with 24 percent.

The value-added volume of the sector is low and the road to an integrated textile industry in Cambodia is still long. Machines, raw materials and design come from abroad in the form of a CMT model ("Cut Make Trim"). Fabrics, yarns and haberdashery have to be imported in order to keep the local clothing industry "on the runway". In 2016, according to the United Nations Comtrade Database, USD 4.1 billion worth of textiles came into the country for processing - about 60 percent of which came from China. Textile imports have risen proportionally to clothing exports in recent years.

The garment industry is dominated by foreign companies, mostly from the Asian neighborhood China, Hong Kong (SVR), Singapore, Malaysia or South Korea. Many manufacturers produce to order for multinational brands such as Adidas, Puma, Gap, H&M, Marks & Spencer or Uniqlo. In principle, the complete contract manufacturing is intended for export.

Rising wages fuel fear of competition
After years of growth the sector is looking to the future with concern. The country is increasingly in danger of losing market share to its competitors - for example in Myanmar, Vietnam or Bangladesh - primarily due to rising wage costs. In January 2018, the monthly minimum wage for workers was raised to USD 170, up from USD 153. Compared to 2013, when a minimum of USD 80 was required by law, there has now been more than a doubling.

The annual agenda included regular increases of around 10 percent. According to the Cambodia Garment and Footwear Sector Bulletin of the International Labor Organization (ILO), workers who worked the full month, including overtime payments and incentives, were paid an average wage of just under USD 243 in 2017. Last year, it was USD 225.

In the past, low wages were mainly responsible for the attractiveness and competitiveness of Cambodian industry. This advantage is crumbling year after year as a result of the increase of minimum wages. An end to this politically motivated development is not in sight. The government can imagine, referring to expert recommendations, that minimum wages will be raised to USD 250 per month by 2023.

If the trend continues, companies are likely to migrate and not too many new investors will pitch their tents in Cambodia, critics warn. In 2017, sector companies invested nearly USD 270 million in 55 projects. This represented 5 per cent of the Kingdom's total investments. In the previous year, this share had been 9 percent.

Industry representatives complain that the costs grow faster than the productivity. Automation of production processes is becoming more and more urgent in order to keep up with productivity. However, both the lack of skilled workers and an infrastructure in need of improvement are serious bottleneck factors. There are also critics who are generally pessimistic about a possible automation in the sector. Cambodia could only score points through low labor cost advantages. Automated mass production is reserved for countries that have a reliable and cost-effective power supply and are closer to the sales markets.

Will the trade routes to the EU remain free?
Even more worrying would be the EU's cancellation of the preferential trading system EBA ("Everything But Arms"). Finally, the exemption of Cambodian clothing from customs duties is at stake on the main market. A discontinuation is likely to trigger a wave of migration of the clothing industry. Quite a few companies have taken the EBA initiative alone as an opportunity to establish themselves in the Kingdom.

In addition, the view wanders across the border to Vietnam. Manufacturers there could soon benefit from a free trade agreement with the EU. Vietnam is also participating at the Asia-Pacific Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP), while Cambodia remains outside. If the trade arrangements remain unchanged, Cambodia may get off with a black eye. However, the other factors should not be ignored. Transport and general export costs are also considered comparatively high compared with Vietnam or China.

Cambodian exporters are currently benefiting from the trade dispute between the USA and China. The National Bank of Cambodia (NBC) semi-annual report supports this assumption. According to the study, apparel and footwear exports rose by 11 percent in the first six months of 2018 compared to the same period of last year to reach a volume of USD 4 billion. Since July 2016, clothing, shoes and travel goods (suitcases, bags, etc.) can be delivered duty-free to the USA. According to the Garment Manufacturers Association of Cambodia (GMAC), shipments of travel goods to the USA in the first half of 2018 reached an amount of around USD 160 million - three times the previous annual exports.

Cambodia's imports of textile machinery amounted to USD 127.3 million (SITC 724) in 2017 according to the UN Comtrade database. This was 11.4 percent more than in the previous year. About 60 percent of the capital goods came from China; the remaining deliveries are relatively evenly distributed among other Asian countries. German deliveries only appear very sparsely in the statistics. Used machines from abroad are more likely to be in demand, but are not recorded statistically.

More information:
cambodja Asien GTAI
Source:

Michael Sauermost, Germany Trade & Invest www.gtai.de

PIXABAY
27.11.2018

EGYPT'S TEXTILE AND CLOTHING SECTOR FACING MODERNIZATION

  • State enterprises get better equipment

Cairo (GTAI) - The Egyptian government plans to modernize the textile sector and private companies are investing in new locations. Increasing machine imports and clothing exports are expected.

In the Egyptian textile and clothing industry, the signs are pointing to expansion and modernization. Local media reported on a number of private and public investment projects. According to the newspaper Al Gomhouria, a Chinese producer in the Suez Canal economic zone is planning the world's largest textile factory for USD 6 billion. The Chinese companies TIDA and Shoon Dong Roy want to build a clothing factory for 800 million USD. Sino-Egypt Minkai is planning to build a textile industry complex for around USD 750 million.

  • State enterprises get better equipment

Cairo (GTAI) - The Egyptian government plans to modernize the textile sector and private companies are investing in new locations. Increasing machine imports and clothing exports are expected.

In the Egyptian textile and clothing industry, the signs are pointing to expansion and modernization. Local media reported on a number of private and public investment projects. According to the newspaper Al Gomhouria, a Chinese producer in the Suez Canal economic zone is planning the world's largest textile factory for USD 6 billion. The Chinese companies TIDA and Shoon Dong Roy want to build a clothing factory for 800 million USD. Sino-Egypt Minkai is planning to build a textile industry complex for around USD 750 million.

The Egyptian state also wants to strengthen the textile and clothing production. In November 2018, the Minister of State Enterprise Hisham Tawfiq negotiated an extensive restructuring of the Cotton & Textile Holding Company with Werner International of the USA. According to press reports, the properties of 14 of the 25 cotton ginning plants should be sold. The ministry estimates the value at USD 1.5 billion. This appropriation is intended to cover the repair of machinery and the import of new equipment for the eleven remaining companies.

A free zone for textile production will also be created in Minya on the initiative of the state. This industrial zone is to be built on an area of 2.2 million square metres: The General Authority for Free Zones and Investment intends to launch the project before the end of 2018.

In autumn 2018, the Cotton & Textiles Industries Holding Company and Marubeni of Japan signed a letter of intent. This relates to the construction of a new textile factory in Kafr El Sheikh. A reduced loan from the Japan Bank for International Cooperation secures the financing of the project.

Import demand for textile and clothing machinery expected to increase
The planned projects are expected to lead to a further increase of a demand of imports. Like other types of equipment, the vast majority of textile and clothing machinery is imported into Egypt. In 2017 the German share of deliveries fell by 8.4 percentage points to an year-on-year comparison to 12 percent. However, this reduction is put into a perspective by the fact that the reference year 2016 was a positive outlier. In 2015, the German share was still 15.8 percent.

Imports of textile and clothing machinery to Egypt (in USD 1,000)
HS-Category 2016 Therof from Germany 2017 Therof from Germany
8444 4,481 2,025 5,554 n.v.
8445 26,105 5,429 32,660 4,807
8446 23,591 13,346 26,170 4,493
8447 15,713 3,052 22,032 4,493
8448 20.574 3,365 18,013 2,698
8449 299 0 1,725 0.4
8451 36,512 2,334 37,887 3,511
8452 23,186 1,698 29,633 1,309
8453 3,678 137 9,892 155
Total 154,139 31,386 183,566 22,028.4

n.a. = not available
Source: Comtrade

Egyptian textile and clothing companies often produce with a lot of manual work and partly with very outdated machines. The government's aim is to create as many jobs as possible due to the continued population growth. On the other hand, a more automated and modern production would allow more complex products. These could be sold at a higher profit, but would also require less human labor.

Important role of the sector companies for the Egyptian economy
The textile and clothing companies in Egypt represent a significant and labor-intensive industry. Local and imported fibers are being processed in the country and there is a broad base of spinning mills, weaving mills, dyeing houses and manufacturers of clothing and home textiles. It is estimated that the companies employ between 1 million and 1.2 million people. A regional focus is Mahala El Kubra. State enterprises are strongly represented in the textile sector, while the private sector plays a greater role in the clothing sector. About 90 percent of the spinning and weaving mills are state-owned.

According to the Readymade Garments Export Council (RMGEC), the garment industry accounts for 3 percent of the country's gross domestic product, 15 percent of exports (excluding oil), and one of three industrial jobs in the country. From January to the end of August 2018, clothing exports to the RMGEC totaled USD 1,040 million. In the same period of 2017, exports amounted to only US$ 980 million.

Egyptian exports of textiles and clothing (selection; in USD million;
change in %)
HS-Category 2016 2017 Change 2017 / 2016
57 303.5 313.9 3.4
60 35.7 44.3 24.1
61 388.0 466.0 20.1
62 756.6 910.7 20.4
63 227.2 231.1 1.7
Total 1,711.0 1,966.0 14.9

Source: UN Comtrade

The Qualified Industrial Zones (QIZ) play a special role. These are special zones with Israeli added value, which are fixed during production, and the products enjoy customs advantages when exported to the USA. Since 2005, the QIZ system has provided more private investments in the garment sector. Jeans and other clothing for well-known brands are delivered to the USA from the 25 zones.
Egyptian manufacturers are also generally not always recognizable as such, as they often manufacture for major international brands. Middle East Eye names Calvin Klein, Decathlon, Tommy Hilfiger and Zara as examples. In November 2017 Dice Sport and Casual Wear agreed to supply Levi Strauss & Co. with children's clothing.

The US company Disney even purchases 33 types of products from Egypt. Since 2017, Egypt has been cooperating with the International Labor Organization ILO as part of the Better Work Program. Working conditions are to be improved in 30 clothing factories. According to media reports, for Disney these measures were a reason to extend the licenses of the Egyptian suppliers until December 2019.

Currency effect improves competitiveness
The labor-intensive production benefited from the currency devaluation in 2016. According to a report by the news portal Middle East Eye, Egypt has at least 100 USD monthly salary for workers and is about at the same level as India or Bangladesh and at about 50 of percent Chinese salaries. In addition, prompt and fast deliveries to Europe and the USA are possible.

On the other hand, the companies are dependent on foreign supplies, which became more expensive. In Egypt especially soft and high-quality long staple cotton is cultivated and exported. Domestic producers, on the other hand, mainly use short-staple cotton and other foreign fibers as raw materials. The RMGEC complained about rising production costs in October 2018. Wages, electricity, water, natural gas, transports and more expensive imports of raw materials contributed to this development.


Further information on Egypt can be found at http://www.gtai.de

 

More information:
GTAI Ägypten
Source:

Oliver Idem, Germany Trade & Invest www.gtai.de

13.11.2018

TUNISIA'S TEXTILE SECTOR RECOVERS

German suppliers can benefit from production expansions
Tunis (GTAI) - After difficult years, Tunisia's textile sector is recovering. Exports and foreign investment are on the rise again. Production is for export, especially to Europe.

At the end of October 2018, the Swiss auditing group SGS reported its expanded testing capacity for textiles in Tunisia. This was in response to the increased demand from producers producing for the world market in Tunisia. The sector has not been doing well in recent years. Even before the revolution in 2011, competitive pressure from Asian producers had left its mark, especially after the expiry of the multi-fiber agreement in 2005. According to the FTTH (Fédération Tunisienne du textile et de l'habillement), more than 400 companies have left the country since 2011 and 40,000 jobs have been lost.

German suppliers can benefit from production expansions
Tunis (GTAI) - After difficult years, Tunisia's textile sector is recovering. Exports and foreign investment are on the rise again. Production is for export, especially to Europe.

At the end of October 2018, the Swiss auditing group SGS reported its expanded testing capacity for textiles in Tunisia. This was in response to the increased demand from producers producing for the world market in Tunisia. The sector has not been doing well in recent years. Even before the revolution in 2011, competitive pressure from Asian producers had left its mark, especially after the expiry of the multi-fiber agreement in 2005. According to the FTTH (Fédération Tunisienne du textile et de l'habillement), more than 400 companies have left the country since 2011 and 40,000 jobs have been lost.

Now positive news are coming: In 2018, for example, the German Gonser Group opened its fifth production facility in Tunisia. In total, foreign direct investments in the first six months of 2018 amounted to Tunisian Dinar (tD) 24.9 million (approx. EUR 7.5 million), 1 tD = approx. EUR 0.301as of 11. 07.), more than twice as high as in the corresponding period of the previous year. The fact, that the number of new created jobs as a result has risen much less, can be seen as confirmation of the structural change: Away from simple mass production to higher-value production.

A high level of employee training is also decisive for this. The Sartex company shows how this can be ensured. In 2014, the Tunisian company opened a training center, in which some 500 Tunisians have already been trained and most of them were hired by Sartex. The company was supported by the Gesellschaft für Internationale Zusammenarbeit (GIZ) and the Centre d'Orientation et de Reconversion Professionnelle (CORP) of the AHK Tunisia.

During the visit of Federal Development Minister Müller in October 2018, an agreement was signed on the establishment of a training center in EL Alia in the Bizerte governorate. Among others the German company van Laack is producing in the region. A total of 180,000 Tunisians now work in the textile sector, which accounts with that for about 40 percent of industrial jobs.

Wage increases in two steps
More than one year after its foundation, FTTH has established itself as the interest representative of textile companies. In 2017 the company split from the employers' association UTICA (Union Tunisians de l'Industrie, du Commerce et de l'Artisanat), not least because the envisaged general wage increases for the company's own industrial sector were considered unworkable. But meanwhile, common ground and cooperation have been emphasized again, or FTTH describes itself as part of UTICA, with a high degree of autonomy.

An agreement has now also been reached with the Union Générale Tunisienne du Travail (UGTT). This provides for wage increases of 6.5 percent as of 1 January 2019 and 2020 respectively. This wage increases are thus likely to be lower than the inflation, provided that the forecasts for the inflation rate of around 7.5 percent for the current year 2018 will be that way. Currently, the minimum wage in Tunisia's textile and clothing industry for unskilled job starters is around EUR 129 (as of 07-11-2018) per 48-hour week.

Of the more than 1,600 textile companies, over 1,400 are producing exclusively for export. The target markets are clearly in Europe. More than 60 percent of exports went to France and Italy in 2016, with Germany in third place with about 11 percent. As the largest non-European customer, the USA was ranked ninth with less than one per cent. By joining the Common Market for Southern and Eastern Africa (COMESA), Tunisia aims to develop new markets. According to the Ministry of Commerce, bilateral talks are underway with several African countries to provide duty-free market access for Tunisian textiles.

Are Chinese investors discovering Tunisia as a location?
In addition to the relations with the African continent, relations with China could also change in the medium term. At the China-Africa Cooperation Forum held in Beijing in September 2018, Chinese textile companies expressed their interest in Tunisia as a production location. As wages have increased in China in the meantime, a relocation of production to certain sectors of the textile industry could prove useful for the European market.

Exports already increased in 2017. The trend seems to continue in 2018. In 2016 exports were USD 2.9 billion, in 2017 USD 3 billion (a significant increase due to the Dinar's decline in exchange rates (7 billion tD against tD 8.4 billion). According to the first announcements, exports to Europe in the first months of 2018 are expected to have increased again by 3.5 percent compared to 2017. Improving transport and customs clearance should be important for the further development of the textile sector. Especially the companies producing purely for export express this again and again. The textile sector in particular is dependent on short delivery times.

Meanwhile, FTTH is also working to improve the competitive position of Tunisian textile companies on their home market. This applies, for example, to the imports of used clothing for which stricter controls are being desired.

Tunisian imports of machinery, apparatus and equipment for the textile and leather industries and parts thereof (SITC 724; in USD million)
Origin 2015 2016 2017
Total 68.8 67.0 67.3
Italy 15.8 13.7 17.9
China 20.5 12.4 10.6
France   6.5   4.0   7.4
Germany   5.0   6.3   7.2

Note: Thailand was the third largest supplier in 2016, but fell behind in 2017. The table shows the four most important suppliers in 2017
Source: UN Comtrade

In addition to production expansions by German companies, German suppliers could also benefit if the recovery and, above all, structural changes will continue. While total imports of textile and leather machinery fell slightly from around USD 70 million to USD 67 million between 2015 and 2017, German deliveries increased from USD 5 million to USD 7.2 million. (JPS)

Further information on the Chinese commitment in Tunisia can be found online (German only): Link

 

More information:
Tunesia GTAI
Source:

Peter Schmitz, Germany Trade & Invest www.gtai.de

Indien fördert die Textilverarbeitung Photo: Pixabay
23.10.2018

INDIA PROMOTES TEXTILE PROCESSING

  • Integrated industrial parks necessary

New Delhi (GTAI) – The Indian textile sector is not only important for bringing foreign currency into the country, but also because of its role as an employer. The formation of new clusters is now getting supported by the government.

India, as one of the leading global producers not only of cotton, but also of wool, jute and silk, has a historic tradition in converting raw materials. Accordingly, India’s industry concerning spinning and weaving of fabric is broadly positioned, while contributing 14% of India's gross domestic product.

  • Integrated industrial parks necessary

New Delhi (GTAI) – The Indian textile sector is not only important for bringing foreign currency into the country, but also because of its role as an employer. The formation of new clusters is now getting supported by the government.

India, as one of the leading global producers not only of cotton, but also of wool, jute and silk, has a historic tradition in converting raw materials. Accordingly, India’s industry concerning spinning and weaving of fabric is broadly positioned, while contributing 14% of India's gross domestic product.

Even though the sector mostly consists of small enterprises, some clusters emerged. The textile industry can mainly be found in the federal states of Gujarat, West Bengal, Andhra Pradesh and Tamil Nudo.     
A more detailed structure is drawn by Sanjay K Jain, chairman of the textile Association “Confederation of Indian Textile Industry in an interview with Germany Trade & Invest: Knitwear clusters are found in Tirupur, Tamil Nadu, Kolkata, West Bengal, Ludhiana, and Kanpur. There are weaving centers in Ichankaranji and Bhiwandi (both Maharashtra), Erode (Tamil Nadu), Surat (Gujarat), and Bhilwara (Rajasthan). For ready-to-wear a cluster in Panipat (Haryana) and for the production of shirts and trousers has formed a cluster in Bangalore (Karnataka).
 
The state subsidy agency India Brand Equity Foundation (IBEF) recognizes four industrial centers – also according to the regional availability of raw materials. In the north (Kashmir, Ludhiana and Panipat) about 80 percent the production of woolen goods are concentrated. In the west (Ahmedabad, Mumbai, Surat, Raijkot, Indore and Vadodara) is the focus of the cotton industry. Hosiery (Tirupur, Coimbatore and Madurai) and silk products (Bengaluru, Mysore and Chennai) have their strengths in the South. The east of the country is focused on jute goods (Bihar and West Bengal). But also wool (Uttar Pradesh) and cotton goods (West Bengal) are represented. In addition, ac-cording to the IBEF, India has seven export-oriented Special Economic Zones for Textiles and Clothing in mid-2018.

A handicap for the textile industry is the missing size. For example, most low-capacity sites are scattered across the country. The construction of large integrated industrial parks is necessary. The various states and state institutions are also trying to promote new textile clusters.

The central government budget will provide ap-proximately US $ 4 million for the Scheme for Integrated Textile Parks (SITP) program in the fiscal year 2018/19 (April 1 to March 31). There are currently 47 projects in this field. The pro-gram intends the further development of such settlements with a common infrastructure.

More information:
Indien
Source:

Rainer Jaensch, Germany Trade & Invest www.gtai.de

Taiwan's Textile Industry sustains its Position with Innovations Photo: Pixabay
25.09.2018

TAIWAN'S TEXTILE INDUSTRY SUSTAINS ITS POSITION WITH INNOVATIONS

  • Manufacturers rely, among others, on German Machines

Tokyo (GTAI) - When it comes to functional textiles, Taiwan belongs to the international top league. To ensure that this remains the case, industry manufacturers invest in modern equipment and innovations.

Taiwan is an important global supplier of functional textiles. The sector wants to maintain this position and expand it as much as possible. They are therefore investing in new capacities, research and development. There are good sales opportunities for suppliers of pre-products and equipment.

The demand for functional textiles is increasing in the sports, leisure and footwear industries. In other sectors, such as the automotive and medical industries, building materials and agricultural aids, these are also increasingly being used. Functional textiles are usually not recognizable as Taiwan products. Nevertheless, some of them are very visible.

  • Manufacturers rely, among others, on German Machines

Tokyo (GTAI) - When it comes to functional textiles, Taiwan belongs to the international top league. To ensure that this remains the case, industry manufacturers invest in modern equipment and innovations.

Taiwan is an important global supplier of functional textiles. The sector wants to maintain this position and expand it as much as possible. They are therefore investing in new capacities, research and development. There are good sales opportunities for suppliers of pre-products and equipment.

The demand for functional textiles is increasing in the sports, leisure and footwear industries. In other sectors, such as the automotive and medical industries, building materials and agricultural aids, these are also increasingly being used. Functional textiles are usually not recognizable as Taiwan products. Nevertheless, some of them are very visible.

For example, at least 15 out of 32 teams at the 2018 FIFA World Cup wore clothing made with textiles of Taiwanese origin for internationally renowned brand names, according to the Taiwan Industrial Development Bureau (IDB). According to the Taiwan Footwear Manufacturers Association, Taiwanese manufacturers are responsible for approximately 80 percent of all sports shoes produced worldwide.

Textile manufacturers invest
Far Eastern New Century (FENC) is one of the largest textile manufacturers on the island. Its production capacity is nowadays mainly located abroad with productions in China, Japan, the USA and Vietnam. FENC is also expanding its capacity in Taiwan. Polyester spunbonded nonwovens have been produced for the Asian market in a joint venture with Freudenberg in Germany since 1987.

Freudenberg Far Eastern Spunweb has announced that it will set up a third production line for nonwovens at the Tayuan plant, thereby increasing the existing production of 20,000 tons by 11,000 tons per year. Construction of the new production facility, which is scheduled to start operations in 2020, has now begun. The latest automated production technology is to be used. According to the company, the investments amount will approximately be at USD 43 million.

Biggest companies in the textile industry in Taiwan by sales
(in USD million; change compared to previous year in %)

Company 2016 2017 Change
Far Eastern New Century Corp. 6,679 7,157 0.,9
Formosa Taffeta Co., Ltd. 1,233 1,337 2.2
Shinkong Synthetic Fiber Corporation 1,066 1,200 6.1
Eclat Textile Co., Ltd. 759 796 -1.2
Makalot Industrial Co., Ltd. 685 735 1.2
Tainan Spinning Co., Ltd. 602 692 8.3

Source: CommonWealth Magazine, Taiwan Stock Exchange

Germany remains an important equipment supplier
Taiwan's textile manufacturers import their equipment mainly from China, Japan and Germany, with some of the machines produced in China coming from companies with Japanese, German, Italian or Taiwanese parent companies. German deliveries declined by 13.7 percent to USD 71.1 compared to 2016 million in 2017. However, Taiwan's imports from Germany increased by 24.3 percent in the first six months of 2018, exceeding deliveries from Japan at USD 42.5 million.

The fact that the import of equipment remains at a high level has to do with the fact that companies in the textile industry in Taiwan are modernizing existing plants and converting them to Industry 4.0. In addition, the number of textile manufacturers in Taiwan has increased in recent years. According to statistics from the Taiwan Federation of Textiles, the number of companies rose from 3,143 to 3,214 between 2014 and 2017.

Main suppliers of textile machinery *)
to Taiwan (USD million; change in % compared to previous year)

Supplying country 2016 2017 Change
China 108.7 111.0 2.1
Japan 97.2 97.2 0
Germany 82.5 71.1 -13.7
Italy 32.8 23.8 -27.3
Switzerland 13.6 14.1 3.6
USA 19.2 12.1 -37.2
Total 405.4 364.7 -10.0

*) HS-Codes 8444-8453; without 8450
Source: Customs Statistics, Ministry of Finance

Core functions remain in Taiwan
By contrast, the production value of the textile sector fell slightly. In local currency terms, it fell in 2017 compared with 2016 by 1.7 percent. Converted to US dollars, the production value of textiles was USD 9 billion, according to the statistics from the Ministry of Economic Affairs. The production of synthetic fibers stagnated at just under USD 3 billion in 2017.

Taiwan is home to the headquarters of the often family-run textile companies. Purchasing and marketing decisions are mainly made here, and, last but not least, research and development are carried out here too. For example, several manufacturers are currently developing smart textiles with integrated temperature control, heart and location functions.

Foreign activities are diversified
The textile manufacturers are investing predominantly in new capacities outside Taiwan. For example, FENC 2018 is expanding its capacity for PET (polyethylene terephthalate) and terephthalic acid (PTA), which among others are required for the production of synthetic fibers. Together with an Indonesian and a Mexican partner, FENC acquires two new plants of a bankrupt US company in West Virginia and Texas. Among other things, this reduces the risk of possible trade restrictions and, conversely, increases the opportunity to benefit from free trade agreements.

Vietnam is also a focus of investment. Here, most Taiwanese textile companies are in the process of establishing or expanding new capacities. FENC, Formosa Taffeta, Eclat, Makalot and several others invested in the southeast Asian tigerland several years ago. By contrast, new investments in China have become rare, primarily due to rising wage costs.

 

More information:
Taiwan
Source:

Jürgen Maurer, Germany Trade & Invest www.gtai.de

INDIA'S GOVERNMENT SUPPORTS TEXTILE INDUSTRY Photo: Pixabay
11.09.2018

INDIA'S GOVERNMENT SUPPORTS TEXTILE INDUSTRY

  • Clothing exports are declining 

New Delhi (GTAI) - Structural weaknesses and fiscal reforms are affecting the Indian textile industry. Modernization and diversification are necessary. For this where support measures will come into force.

  • Clothing exports are declining 

New Delhi (GTAI) - Structural weaknesses and fiscal reforms are affecting the Indian textile industry. Modernization and diversification are necessary. For this where support measures will come into force.

In the 2016/17 fiscal year (April 1st to March 31st), India's government initiated a number of fundamental reforms such as the introduction of the nationwide Goods and Services Tax (GST) and a partial currency devaluation. These measures are intended to advance the economy as a whole in the medium to long term, but have led to uncertainty and difficulties in individual sectors, including the textile industry. Added to this are high cotton prices. The government is now trying to help the industry with individual measures. It remains to be seen whether these will be sufficient and lead to a sustained improvement. Finally, there are structural weaknesses which are also slowing down the growth of the Industry.

"The by the introduction of GST caused dent and monetary depreciation has now been overcome. However, the structural problems remain, so that no fundamental changes in the textile industry are to be expected", according to the assessment of a German supplier with many years of experience in India in talks with Germany Trade & Invest (GTAI).

Government launches aid measures
However, some government measures should provide relief. At the beginning of August 2018, import duties on 328 textile products, especially fabrics and nonwovens, were increased from around 5 to 10 percent to up to 20 percent. Also, at the beginning of the month, the Executive Board introduced four bills to amend the general VAT Act introduced on July 1st 2017. This should make refunds, for example of taxes on intermediate products, easier and faster. The introduction of GST and the delays in reimbursement have put particular pressure on the liquidity of small and medium-sized companies, which make up the bulk of textile companies. For example, the denim industry temporarily had to take 25 to 30 percent of its capacity out of production after the tax introduction.

 Also, the Ministry of Textiles wants to strengthen the to it entrusted weakening industry. At the beginning of August 2018, for example, it added changes to the Technology Upgradation Funds Scheme (TUFS), which has been in existence since 1999. This now expanded technology promotion program allows cooperative banks to provide financing to textile companies for technological improvements. They also become accessible for liability partnerships. Of the approximately USD 1.1 billion, that the central government budget is holding for the textile industry in the fiscal year 2018/19, one third, 14 percent more than in the previous year, are intended for the TUFS. Manufacturers of synthetic fibers and the clothing industry in particular are likely to benefit from this, according to industry sources.

The existence of an own Ministry of Textiles shows how important this industry is for India, not only as a source of foreign exchange, but also as an employer. The entire sector, from spinning mills, weaving mills to clothing and other finished goods, contributed around 14 percent to value creation in the manufacturing industry and 13 percent to foreign exchange revenues in 2017, and employs directly 40 million and indirectly 60 million workers.

As one of the world's leading producers of cotton, jute and silk, India has comparative advantages in the textile sector and can look back on a long tradition in processing. Accordingly, cotton is the main raw material in yarn and fabric production. After all, 5.7 billion tons of yarn were spun in 2016/17, achieving an annual average increase of 3.1 percent between 2011 and 2017. The weaving mills processed 63.5 billion square meters of fabric in 2016/17, after 61.7 billion in 2011. The proportion of cotton fabrics rose from 51 to 61 percent in 2011 to 2017. The remaining part is accounted for approximately equally by synthetic and blended fabrics.

 
Production and export growth come to a halt Based on the previously strong growth the government is optimistic. According to forecasts by the Ministry of Textile, India's textile and clothing industry is expected to more than double its sales between 2015 and 2021. Exports are expected to increase from USD 35 billion to USD 82 billion, after doubling in the period from 2006 to 2014 from USD 17.6 billion to USD 37.6 billion. After that, however, they stagnated and, at USD 35 billion in 2017/18 and missed the by the government set target by USD 10 billion. The production of textiles and clothing declined from 2015 to 2017. It is unlikely to improve in 2018.

Textile and clothing industry in India 1)
  2015/16
 
2016/17 2)  2017/18 2)
Export of textiles and textiles products USD in USD billion 18.1 18.2 18.7
Export of clothing 17.0 17.4 16.7
Import of yarn, fabrics, made-ups in USD billion 1.7 1.5 n.a.
Change of production of textiles in % -0.2 -3.2 n.a.
Change of production of non-knitted clothing in % -3.6 -3.3 n.a.


1) Financial years from 1 April to 31 March; 2) Provisional data for 2016/17 and 2017/18
Source: Statistical Office India
     

Clothing industry needs to modernize 
India's textile industry has cost advantages over industrialized countries and advanced emerging countries such as China. Smaller developing countries, however, have become well-known competitors in the meantime and have partly surpassed India in terms of clothing. So Bangladesh and Vietnam exported more clothing than India. In addition there is growing competition from other low-wage countries such as Cambodia, Sri Lanka and Indonesia. Some of these countries have free trade agreements with the EU, while India has difficulties in negotiating them. The smaller competitors have also geared their clothing industry to exports and modernized it accordingly. After all, they do not have significant local markets. The Indian textile manufacturers are different: If there is not enough quality for export, the domestic market, which has a population of 1.3 billion inhabitants and is growing strongly, is still there, industry representatives explain to GTAI.

India's apparel industry therefore still has a considerable potential for modernization and requires new production technologies, particularly to improve operating efficiency. Other structural weaknesses include strong wage increases with insufficient productivity growth and a shortage of well-trained skilled workers. Other disadvantages are the fragmentation of the clothing industry - many companies lack size - and the lack of adaptation to global fashion trends. While the fashion world is more prone to fiber mixed fabrics, the Indian clothing is not yet following this trend. There is a lack of product diversification.

The spinning and weaving sector looks more modern. Industry experts attest to it a leading international position in terms of size, technology, productivity, quality and price. This is also evident when importing machines. India was the most important export market for German spinning machines to China in 2017 and the fifth largest market for weaving machines, according to the Textile Machinery Association of the German Engineering Federation (VDMA). In textile finishing machinery, India does not rank among the top six export markets, but its competitor Bangladesh does.

Double-digit growth in foreign direct Investment 
Foreign investments in the Indian textile industry are welcome and 100 percent foundations by foreign companies are welcome. On promotional trips to countries such as Japan, Germany, Italy and France, India is actively attracting investors and has not been unsuccessful. The inflow of foreign direct investment into the textile sector, including dyed and printed textiles, amounted to USD 2.7 billion between April 2000 and September 2017. Cumulative investments increased by an annual average of 17.3 percent between 2010 and 2017. However, the bulk of the investment is being stemmed by national Indians. Total investments in India's textile sector from June 2017 to May 2018 amounted to USD 4.2 Billion.

Contact Details
Name Internet Remark
Germany Trade & Invest http://www.gtai.de/indien Foreign information for the German Export Business
AHK Indien http://www.indien.ahk.de Contact for German companies
Ministry of Textiles http://www.texmin.nic.in Ministry
Office of Textile Commissioner http://www.txcindia.gov.in Government 
Confederation of Indian Textile Industry http://www.citiindia.com Textile Association
Textile Association India http://www.textileassociationindia.org Textile Association India
The Clothing Manufacturers Association of India http://www.cmai.in Clothing Association


    

More information:
India Bangladesh(7621)
Source:

Rainer Jaensch, Germany Trade & Invest www.gtai.de

CHIC Shanghai - THE MOTTO 'NEW MAKERS' BY CHIC INTERPRETS THE PROGRESSIVE CHANGE IN THE CHINESE FASHION BUSINESS Photo: JANDALI MODE.MEDIEN.MESSEN
26.06.2018

CHIC Shanghai - THE MOTTO 'NEW MAKERS' INTERPRETS THE PROGRESSIVE CHANGE IN THE CHINESE FASHION BUSINESS

  • The important trade fair platform for entry into the Chinese consumer market with China's most influential consumer group for the fashion and beauty sector with the strongest growth in consumption - the millennials - as target group
  • The international fashion showcase for decision makers with an overview of na-tional and international fashion brands
  • Strategic market development through comprehensive visitor marketing for inter-national brands at CHIC

 
CHIC, China International Fashion Fair presents around 800 exhibitors in an exhibition space of approx. 50,000 sqm (CHIC in March 100,000 sqm) in two halls from 27 to 29 September 2018 at the National Exhibition & Convention Center in Shanghai.

  • The important trade fair platform for entry into the Chinese consumer market with China's most influential consumer group for the fashion and beauty sector with the strongest growth in consumption - the millennials - as target group
  • The international fashion showcase for decision makers with an overview of na-tional and international fashion brands
  • Strategic market development through comprehensive visitor marketing for inter-national brands at CHIC

 
CHIC, China International Fashion Fair presents around 800 exhibitors in an exhibition space of approx. 50,000 sqm (CHIC in March 100,000 sqm) in two halls from 27 to 29 September 2018 at the National Exhibition & Convention Center in Shanghai.
The current conditions for international fashion companies in the Chinese market offer significant improvements for international brands. Import tariffs will be lowered from 15.9% to 7.1% to further promote the import and upgrade of the industry.  

The McKinsey study "THE `Chinese consumer´ no longer exists” defines Chinese consumers no longer as interested only in low prices, but as selective, healthconscious with diverse shopping hab-its and preferences. The fashion awareness changes to an individual sense of style, influenced by international and national trends. China's millennials are the WORLD'S most influential consumer group, with a 16% share of the population, driving consumption growth in the Chinese market and contributing more than 20% from today until 2030.  
 
According to the edition's motto "New Makers", Asia's leading fashion fair is picking up on the latest changes in the Chinese fashion market and providing the essential tools for the Chinese market. The new, young design of the fair, which was launched in March this year at CHIC, is being ex-panded. The individual sections of CHIC present the latest trends in the Chinese and international fashion market. CHIC connects and brokers partnerships and launches the new generation gar-ment industry, which builds on high-tech strategies and interlinks industrial production with modern information and communication technologies, relying on intelligent, digitally networked systems in self-organized production.

The individual fashion areas of CHIC  
FASHION JOURNEY puts the focus on interna-tional exhibitors. In addition to the large Italian pavilion, the French pavilion "Paris Forever" and the Korean show-inshow "Preview in China", in-dividual participants from Poland, the UK, France, Italy, Spain, Japan and the USA use CHIC as a bridge in the Chinese market. The next German group participation is planned for March 2019, whereby Germany will also be rep-resented with individual brands such as ESISTO in the area NEW LOOK.

IMPULSES, CHIC's designer section, features emerging designer brands such as Junne, Hua Mu Shen, King Ping, Anjaylia, Mao Mart homme, Tuffcan, etc.

The SUSTAINABILITY ZONE, first showcased at CHIC in the fall of 2017, is receiving even greater emphasis due to the increasing environmental and health awareness of Chinese consum-ers, featuring sustainable supply chain solutions, sustainable innovation and sustainable fashion collections. Programs such as Chemical Stewardship 2020, Carbon Stewardship 2020, Water Stewardship 2020 and Circular Stewardship 2020 are presented. The womenswear section NEW LOOK of CHIC presents next to the leading Chinese brands like AVRALA, and CMH also international brands like Saint James from France, ESISTO from Ger-many, Trenz Eight from Canada or PN JONE, USA.

Beside the suppliers of classic menswear, URBAN VIEW, the menswear section, also includes casualwear brands like NRDMA and SUPIN as well as bespoke companies like H. Pin& Tack, Jin Yuan Yang, Fa Lan Qian Mu, Long Sheng and DANDINGHE.
CHIC YOUNG BLOOD shows young lifestyle brands, KID'S PARADISE offers e.g the largest fashion group in China for children's fashion XTEP KIDS.

SECRET STARS (fashion accessories), SHANGHAI BAG (bags), HERITAGE (leather & fur), SUPERIOR FACTORY (ODM) and FUTURE LINK (services) complete the fashion offer at CHIC. FUTURE LINK gathers fashion service providers for among others supply chain solutions, smart retail and smart production, RFID, laser technology and data utilization.

Visitor management
On the rise in China's retail scene, multi brand and custom stores are the fastest growing offline sector. The number has increased significantly in the last five years from less than 100 to more than 5,000 stores. Exclusive shopping experiences and an individual offer are important. Custom-ers value a wide range of products: a mix of international and national exclusive brands is the most common concept.

The high investments of the CHIC organizers in the visi-tor management for the fair pay off: CHIC has a per-sonalized trade visitor database of over 200,000 con-tacts, which are used intensively for the visitor marketing in the run-up to the fair for a commercial matching for the exhibitors. At the fair, VIP match making activities will take place especially for selected international brands, that will have the opportunity to present them-selves there and make the relevant contacts in the Chi-nese trade. Meetings are organized among others with multi brand stores and buyers such as The Fashion Door, Dong Liang, Jing Dong, VIP Shop and department stores, and retailers such as Carrefour, Amazon, De-cathlon, Wang Fujing, etc. An important tool for the CHIC visitor marketing is social media; for this special programs are run, in which individual brands are pre-sented to prospective visitors.    

CHIC is visited by representatives of all distribution channels for distribution in the Chinese market, at the last event in autumn 2017 more than 65,722 visitors from all over China and other nations were registered at the CHIC, with a significant increase in multi brand stores.
 
Seminars and shows

The future of fashion business in China will be discussed in a panel of experts as part of CHIC TALKS. Furthermore, a trend seminar from WGSN for FW 2019 and a workshop on bag and shoe production from the Moda Pelle Academy are planned.

CHIC shows provide an overview of selected international brands.

CHIC is organized by Beijing Fashion Expo. Co. ltd. and China World Exhibitions, supported by China National Garment Association, The Sub-Council of Textile Industry (CCPIT) and China World Trade Center.

Textile innovations ‘made in Germany’ in demand in the USA (c) KameraStudio for Messe Frankfurt Exhibition GmbH
05.06.2018

Textile innovations ‘made in Germany’ in demand in the USA

‘High-Tex from Germany’ at Techtextil North America and Texprocess Americas shows again how innovative the German textile industry is.

Back to the USA: ‘High-Tex from Germany’ made a guest appearance at Techtextil North America and Texprocess Americas in Atlanta for the second time from 22 to 24 May 2018. At the special exhibition organised by the Federal Ministry of Economics and Energy (Bundesministerium für Wirtschaft und Energie – BMWi) in cooperation with the Association of the German Trade Fair Industry (Messeausschuss der Deutschen Wirtschaft e.V. – AUMA), a total of 66 companies presented technical textiles, nonwovens, textile-processing machines, smart textiles and textile-research projects to the trade visitors. The textile sector made its first appearance in the USA in 2000. This was followed by highly successful presentations in Shanghai in 2002, in Mumbai in 2007 and in Moscow in 2012.

‘High-Tex from Germany’ at Techtextil North America and Texprocess Americas shows again how innovative the German textile industry is.

Back to the USA: ‘High-Tex from Germany’ made a guest appearance at Techtextil North America and Texprocess Americas in Atlanta for the second time from 22 to 24 May 2018. At the special exhibition organised by the Federal Ministry of Economics and Energy (Bundesministerium für Wirtschaft und Energie – BMWi) in cooperation with the Association of the German Trade Fair Industry (Messeausschuss der Deutschen Wirtschaft e.V. – AUMA), a total of 66 companies presented technical textiles, nonwovens, textile-processing machines, smart textiles and textile-research projects to the trade visitors. The textile sector made its first appearance in the USA in 2000. This was followed by highly successful presentations in Shanghai in 2002, in Mumbai in 2007 and in Moscow in 2012.

“Taking ‘High-Tex from Germany’ to Atlanta again was a very good decision. The southeast of the USA has a long tradition of textile manufacturing. It is home to many companies that are always on the lookout for innovative textiles and machines for textile production and processing”, explained Detlev Rünger, German Consul General in Atlanta during the ‘High-Tex from Germany’ press conference. “Fairs bring people together. And this was evident here in Atlanta. With the overseas exhibition programme, we give small to medium-sized companies the chance to show their products in foreign markets”, said Patrick Specht of the Trade Fair Policy and EXPO Participations division of the BMWi.

“‘High-Tex from Germany’ within the framework of Techtextil North America and Texprocess Americas was a very good platform for our small to medium-sized companies. After Techtextil and Texprocess in Frankfurt, these two events are the second-most important editions of the trade-fair duo. ‘High-Tex from Germany’ came fully up to our expectations and anyone who failed to take part missed a great opportunity to be noticed”, said Marc Lorch, Member of the Board of Zwissler Holding, who represented the participating companies as exhibitor president.

Michael Metzler, Sales President of ZSK Stickmaschinen, confirmed this saying, “A German pavilion of this scope makes us extremely visible. Thanks to the excellent organisation, we were also able to concentrate on promoting our company and products.” In addition to the appealing exhibition-stand concept and the excellent organisation, the companies taking part were particularly pleased with the high visitor standard. “We regularly exhibit at Techtextil North America but taking part in ‘High-Tex for Germany’ resulted in our best ever day at a fair here. The pavilion is a real eye-catcher”, said Thomas Wiederer, Area Sales Manager, Brückner Textile Technologies. “The visitors to our exhibition stand were very interested in our products. We gained potential customers and were able to make numerous high-grade contacts. The level of interest shown in our highly innovative e-textile solutions, which are completely new in the sector, was very high. We are looking forward to the follow-up phase”, said Andreas Lanyi, Vice President Digital Unit and Internet of Things of the Hamburg-based start-up, Lunative Laboratories.

Besides gaining new customers, the focus of the companies taking part in ‘High-Tex from Germany’ was on cultivating customer relations. “The German pavilion in Atlanta once again gave us a good opportunity to get to know the US market better. We have had a factory in the vicinity of Atlanta for two years now and aim to expand our network in the long term”, said Ronny Schröder, Associate Sales Director Technical and Comfort Products, Sandler. “We like making presentations within the framework of the German pavilion very much”, added Georg Voggenreiter, Technical Sales, Maschinenfabrik Herbert Meyer. “Once again, ‘High-Tex from Germany’ was a good starting point for cultivating contacts with our customers in the USA.”

The companies taking part in ‘High-Tex from Germany’ made their presentations on around 1,300 square metres of exhibition space with their own exhibition stands, with selected exhibits on a central ‘Plaza’, in guided tours and no less than 35 lectures. Additionally, the German Institutes of Textile and Fibre Research (Deutsche Institute für Textil- und Faserforschung – DITF), the Association of the Finishing, Yarns, Woven Fabrics and Technical Textiles Industry (Industrieverband Veredlung, Garne, Gewebe und Technische Textilien – IVGT), the Tübingen-Reutlingen-Zollernalb location agency and the German American Chamber of Commerce of the Southern U.S. provided insights into current research projects and offered information about the sector.

mtex+ and LiMA 2018 (c) Messe Chemnitz
22.05.2018

mtex+ and LiMA 2018: BRIDGE BUILDING BETWEEN TECHNICAL TEXTILES AND LIGHTWEIGHT

At May 29/30, 2018, 147 exhibitors from six countries present application-oriented textil and lightweight-solutions for all sectors from A to Z and introduce numerous innovations in Chemnitz - Special exhibitions and specialiced events deepen the trade fair topics and give inspiration for innovation development and business contacts

At May 29/30, 2018, 147 exhibitors from six countries present application-oriented textil and lightweight-solutions for all sectors from A to Z and introduce numerous innovations in Chemnitz - Special exhibitions and specialiced events deepen the trade fair topics and give inspiration for innovation development and business contacts

With a 10 % plus of exhibitors and an exhibition area which rose 20 % the trade fair duo mtex+ and LiMA starts at May 29/30, 2018. At hall 1 of the Messe Chemnitz 147 companies and research institutes present on 4.200 square metres application-oriented textil and lightweight-solutions for sectors from architecture to railway technology. On 3.500 square metres 134 exhibitors were represented at the previous trade fair in 2016 in Chemnitz. „We are pleased that the merging of the fields of technology technical textiles and lightweight becomes even more visible at our trade fair duo. Not only exhibitors from the Central German industry and research region demonstrate their know-how. We can as well welcome companies and research institutes from all over Germany adding Belgium, France, Austria, Switzerland and the Czech Republic in Chemnitz. To us this is the proof that the further merge of mtex+ and LiMA under the new slogan ‚Excellent connections: Technical textiles meet lightweight construction‘ works out“, emphasises Dr. Ralf Schulze, director C³ Chemnitzer Veranstaltungszentren GmbH, to which the Messe Chemnitz belongs.

Innovations from textil circuit boards to railway-components made of basalt and bamboo
The international trade fair for technical textiles mtex+ and the lightweight trade fair LiMA focus on functionalised and intelligent textiles as well as lightweight materials and –products, digitised production, process development-, process- and technology development, refinement and recycling. The exhibitors in 2018 put various innovations forward. The nonwoven-manufacturer Glatzeder arrives with a protective suit made of an entirely new material, which is suitable for work under extreme conditions. A especially for security forces made protective clothing will be shown by Wattana. Flexible textil circuit boards made of conductive nonwovens are the new development from Norafin. Vowalon presents a surface sealing for imitation leather padding which extends its service life. Light interactive components as well as tables and seating areas made of textile concrete will be shown by the TU Chemnitz. HÖRMANN Vehicle Engineering demonstrates trim - and interior components  for railway vehicles with basalt- and bamboo fibre.
New and proven special exhibitions offer insights into innovative developments besides the exhibition stands. A new addition at the program is „light.building“ belonging to lightweight in architecture and building trade and „flexible.protect“ belonging to  protection- and safety textiles for humans, nature, mobile and immobile goods. The successful exhibition „health.textil” with medicine-, health- and wellness textiles from 2016 will be continued.

Compact, intensive and international
The exhibition stand- and special exhibition-presentations demonstrate the growing application range of technical textiles and lightweight. „Hightech-textiles and lightweight solutions conquer more and more new fields of application. Compact seen should be the various possibilities in the Central German industrial metropolis Chemnitz, that is and was a centre of innovative textile industry. The atmosphere of the small but fine trade fair duo of short distances and intensive contacts is not only appreciated by the actors of the strong Saxon-Thuringian textile region but also by foreign companies and research institutes. So are the textile federation ATOK and the Techtex-Cluster CLUTEX from the Czech Republic with a multicompany stand and the Smart-Textiles-Network from Austria our guests again“, informs Dr. Jenz Otto, general manager of the Noth-Eastgerman textile- and clothing industry association (vti) and amends: „The exhibiton is not only an obligatory date for the specialised insiders but also the federal policy shows a great interest in the textil- and lightweight- competences of the region. Because of this the Commissioner for middle class and for the new Länder, Christian Hirte, follows our trade fair duo invitation.“ The vti is from the very beginning major partner and a generator of inputs for the continuous further development of the event.

You can find further information about the program as well as the trade fairs under: www.mtex-lima.de

 

ETHOPIA CAN SET UP FURTHER TEXTILE FACTORIES Photo: Pixabay
15.05.2018

ETHOPIA CAN SET UP FURTHER TEXTILE FACTORIES

  • Sudanese and Chinese investors want to secure raw material supplies

Nairobi (GTAI) - Ethiopia has further successes in attracting textile companies: One British company is planning to invest USD 100 million, one Chinese company even plans to invest USD 220 million. This means that the textile sector is increasingly becoming a self-starter, as donors increasingly want to supply domestic industry with pre-products. Meanwhile, those who invest should not only raise the financial means, but also the raw material cotton, according to market experts.

  • Sudanese and Chinese investors want to secure raw material supplies

Nairobi (GTAI) - Ethiopia has further successes in attracting textile companies: One British company is planning to invest USD 100 million, one Chinese company even plans to invest USD 220 million. This means that the textile sector is increasingly becoming a self-starter, as donors increasingly want to supply domestic industry with pre-products. Meanwhile, those who invest should not only raise the financial means, but also the raw material cotton, according to market experts.

The Ethiopian textile and clothing market has two new entrants: the British Intrade Co. UK Ltd. and the Chinese Wuxi No. 1 Cotton Investment Co. Ltd, Intrade intends to build a textile and clothing factory in the Mekelle Industrial Park (Tigray Regional State), which was opened in July 2017. Initial cost estimates are around USD 100 million. Intrade is an offshore company of the Sudanese Mahgoub-Sons Group. The company has reached an agreement with the Ethiopian Investment Commission to invest USD 200 million in three projects. The textile project is to be completed in 16 months.

Security of supply for cotton is becoming an issue
The Sudanese group is not only interested in textile production, but also with lucrative supply transactions for its own cotton. They have the capacity to supply 500,000 tons of long staple quality cotton annually, Wagdi Mirghani Mahgoub, Managing Director of Intrade says. The supply of raw cotton has become an increasing problem for the emerging Ethiopian textile industry since some Asian countries ordered export stops for the raw material, including the PR China and India. The African Plantation, which cultivates 33,000 hectares of agricultural land in Sudan, also belongs to the Mahgoub-Sons Group.

However, Wuxi No. 1 Cotton Investment has announced the second and larger textile investment of 2018: a textile factory will be opened shortly in the Dire Dawa Industrial Park. In a first phase, USD 80 million are planned, followed by further investments totaling USD 140 million. The company intends to install state-of-the-art textile machines to produce and supply goods for the demanding markets in Europe, Japan, South Korea and Southeast Asia. According to their own statements, partners are leading world machinery brands. Wuxi is already pursuing a project in the Ethiopian city of Adama and also has plans to grow cotton in Ethiopia.

Ethiopia is considered the first textile address in Africa
"Clothing companies are nomads," an industry consultant knows, "they go where it is cheapest for them. If wages and ancillary costs rise too much in countries like Bangladesh or the PR China, the caravan moves on." South of the Sahara, only Mauritius has made a name for itself as a producer of high-quality clothing. Attempts to establish larger-scale textile and clothing companies in Namibia and Lesotho have so far been unsuccessful. Meanwhile, Kenya and Ghana have production conditions that are far too expensive.

Ethiopia offers several advantages at the same time: Wages and ancillary costs are extremely low and far below those in China. The US Centre for Global Development found out that a worker in Ethiopian sweatshops earns an average of USD 909 a year. In Bangladesh, however, it is US$ 835 and in Tanzania and Kenya even US$ 1,776 and US$ 2,118 respectively. Another advantage: Ethiopian seamstresses are considered to be extremely hardworking and reliable. In addition, there is a tradition in textile and clothing production as well as in leather processing and thus there is a basic pool of trained specialists.

Infrastructure is making huge progress
Meanwhile, the supply of domestic cotton and leather needs to be expanded, because in the drought years 2016 and partly 2017 the supply of cotton was insufficient. The government is cooperating and is increasingly listening to the needs of producers. The infrastructure is currently undergoing sustained improvement, in particular the transport routes to the neighboring seaport of Djibouti, from where Europe can be reached more quickly than from the Far East. And, last but not least, the Ethiopian capital Addis Ababa has a capable air traffic hub with a dozen direct flights to the EU, including Frankfurt and Vienna. In addition, there is a modern air freight center.

Just as important as the delivery routes are the comparatively modern production conditions in the newly emerging industrial centers throughout the country. Everything here is "Made in China": fences, access controls, roads, electricity and water supply, waste and sewage disposal, workers' settlements. From a European perspective, this may look like Chinese dominance, but from an Ethiopian perspective it creates jobs, feeds families and earns foreign exchange. Under better working conditions than in Bangladesh, experts mean.

According to the ideas of the Ethiopian government, the country is undergoing a transformation process: away from an agrarian-based economy and towards an industrial state. By 2025, the country is expected to reach middle-income status and to become Africa's largest industrial production hub. To achieve this, Ethiopia is investing heavily in roads, railways and power generation, health and education, urban and rural development and the creation of industrial clusters.

Customs advantages in the USA and Europe
Ethiopia has so far benefited from the African Growth and Opportunity Act (AGOA) of the USA, which, for example, allows savings of 16.8 percent in import duties on cotton trousers and 30 percent on synthetic shirts. Ethiopia also has duty-free access to the EU market under the Everything but Arms initiative. Fears that US President Donald Trump might stop AGOA have not yet come true.

Ethiopian exports of textiles, clothing and leather products
(including footwear; in US$ millions)

SITC-Commodity Group
 2014 2015 2016
61 Leather and leather goods    97.51    98.20
78.63  
65 Yarn, fabrics, finished textile products and related articles  39.34  39.12 29.61
84 Clothing and apparel accessories  55.53  77.94  68.25
85 Shoes         
 33.88
 37.69  43.80
Total 226,26 252,95  220,2

Source: Comtrade

German exports can be expanded
German sales representatives of technology for the textile, clothing and leather industry are not yet well positioned in Ethiopia. According to preliminary figures from the Federal Statistical Office (SITC 724), only EUR 2.84 million of relevant technology where sent to Ethiopia in 2017, though 169 percent more than in the previous year.

Ethiopian imports of machinery, equipment and parts for the textile and leather industries
(SITC 724; in USD millions)

Supplying Country 2014    2015 2016
Total 131.30 170.51 111.10
.. PR China  43.87  42.40 62.07
..Italy 6.38 11.75 11.72
..Japan 4.40 10.11 6.89
..Turkey   4.86 19.14 4.92
..Other Asian countries, not specified 1.85 1.87 4.11
..India  6.07 6.49 3.06
..Germany 9.22 9.08 2.44

Source: Comtrade

 

Source:

Martin Böll, Nairobi (GTAI)

Foto: Pixabay
08.05.2018

IN INDONESIA DEMAND FOR TEXTILE MACHINERY STAGNATING

  • Clothing exports stagnate
  • Shoe production becomes more important
  • Investment in modern technology necessary

Bonn (GTAI) - The Indonesian textile industry faces strong regional competition. Since their demand for machinery and clothing exports peaked about five years ago, the industry's exports have stagnated. Nevertheless, the archipelago is important for international market participants at least as a second location alongside the major producing countries. In the meantime, the country has developed into an important shoe manufacturer and is further expanding its production capacities.

  • Clothing exports stagnate
  • Shoe production becomes more important
  • Investment in modern technology necessary

Bonn (GTAI) - The Indonesian textile industry faces strong regional competition. Since their demand for machinery and clothing exports peaked about five years ago, the industry's exports have stagnated. Nevertheless, the archipelago is important for international market participants at least as a second location alongside the major producing countries. In the meantime, the country has developed into an important shoe manufacturer and is further expanding its production capacities.

Indonesia is one of the top 15 clothing exporters. Over the past decades, the archipelago has continuously increased its production and thus created a growing demand for textile machinery. But the market has been stagnating for five years: exports are at around USD 7.5 billion per year, and imports of textile machinery have fallen from USD 1 billion per year to only around 800 million US dollars.

The most important supplier of textile machinery is the PR China, which has expanded its import share to around 30 percent in recent years and displaced Japan from first place. According to Indonesian import statistics, the German delivery ratio fluctuates by 10 percent.

The Indonesian textile association API cites the lower demand for clothing, especially from the USA and Europe, as the reason for the weak export development. About half of industry exports goes to North America. The largest customers are Japan, Germany, South Korea and the United Kingdom. What the association does not say: Bangladesh, Vietnam, India, Cambodia and Myanmar have all significantly increased their clothing exports in the past five years.

Indonesia's import of textile machinery *) (in USD million)
2007 360.5
2008 580.9
2009 339.9
2010 641.1
2011 952.1
2012 1.021.7
2013 973.8
2014 940.2
2015 804.3
2016 822.9

*) SITC 724
Source: UN Comtrade

Shorter production cycles
Indonesia's textile companies must therefore invest in order to remain competitive. Even though, according to API, more than half of the member companies are already technologically advanced, many market participants still have an outdated machinery. And especially against the background of fiercer competitive conditions, this is a decisive disadvantage. According to the association, larger fashion chains insist on ever shorter delivery times. Where the producers used to have three months, today it is only three weeks.

Regional competition is also a problem for manufacturers. The archipelago has good conditions for a labor-intensive industry such as the textile industry. Wages are low - outside the conurbations - and the labor supply is inexhaustible (also because many men work as sewers in the factories). Nevertheless, the country has not yet managed to become serious competition for the main export countries of cheap mass-produced goods.

Indonesia's import of textile machinery by supplier countries *) (in USD million; Change in % compared to previous year)
  2014 2015 2016 Change
PR China 279.4 269.2 524.7 -5.4
Taiwan 79.7 86.8 98.3 13.2
Germany 104.5 68.4 93.6 36.8
Japan 163.7 91.3 85.1 -6.8
Korean Rep. 60.5 65.8 57.0 -13.4
India 48.3 43.1 42.6 -1.2
Singapur 37.1 33.4 41.3 23.7
Italy 47.1 39.1 36.3 -7.2

*) SITC 724
Source: UN Comtrade

The archipelago also has locational disadvantages: it is further away from the European sales markets than other manufacturing countries and has a greater distance to China also, which, due to the high wage increases, is increasingly relocating its clothing production to its immediate neighbors. Moreover, in Indonesia, which is comparatively wealthy due to its large raw material exports, the minimum wages of India, Cambodia, Bangladesh or Myanmar cannot be undercut.

Asia's top clothing exporters 1) (USD billion;
change 2016 compared to 2011 in %)
  2011 2016 Change
PR China 153.7 158.2 2.9
Bangladesh 19.2 29.5** 53.6
Vietnam 13.1 22.9** 74.8
India 14.7 17.9 21.8
Indonesia 8.0 7.5 -7.1
Cambodia 4.0 6.6** 65.0

1) SITC 84; 2) Mirror statistics of partner countries
Source: UN Comtrade

Investments at previous year's level
After all, Indonesia has managed to become an important second location for international apparel companies, mitigating risks in major manufacturing countries. Most of the manufacturers are located in populous Java. For the government, further expansion of the industry is important in order to bring the large number of unskilled workers to work.

According to the latest available data from the Federal Statistical Office (BPS), the number of employees in the roughly 2,600 medium and large companies in the sector has increased from 470,000 (2008) to 550,000 (2014). In addition, there are just under 210,000 workers in small and micro companies (2015), most of whom are one- or two-person businesses.

The BKPM investment agency reports FDI of USD 184 million for the first half of 2017 for 494 projects. This corresponds almost exactly to the sum of the same period of the previous year. For the full year of 2016, USD 321 million of FDI had flowed into the sector.

Shoe manufacturers expand capacities
The domestic footwear industry is developing far more dynamically than the textile industry. Indonesia has become the third most important exporter in terms of cheap mass production in a few years, but it is far behind China and Vietnam. After all, the corresponding exports between 2011 and 2016 have steadily increased from USD 3.3 billion to USD 4.6 billion.

Asia's most important footwear exporters 1 (in USD bn, change 2016 compared to 2015 in %)
  2011 2016 Change
PR China 41.7 47.2 13.1
Vietnam 6.7 13.0** 93.5
Indonesia 3.3 4.6 40.5
India 2.1 2.7 31.4

1) SITC 82; 2) General Statistics Office of Vietnam
Source: UN Comtrade

And the signs are still on expansion: In the first six months of 2017, the leather and footwear sector had FDI of USD 187 million, a third more than in the total year 2016. Domestic market participants are also expanding. The Indonesian manufacturer SCI is currently building a new production facility in the central Javanese Salatiga, near the port city of Semarang. It should be completed in October. In the first phase 300,000 to 500,000 pairs of shoes per year could be produced, the maximum capacity is 1 million pairs.
 

Source:

Frank Malerius, Germany Trade & Invest www.gtai.de

INTERTEXTILE SHANGHAI HOME TEXTILES  SPRING (c) Messe Frankfurt (HK) Ltd.
03.04.2018

INTERTEXTILE SHANGHAI HOME TEXTILES SPRING: OCCASION FOR CONCRETE BUSINESS OUTCOMES AND BRAND BUILDING IN CHINA

  • Quality suppliers satisfied buyers with a wide range of sourcing needs
  • Fringe programme brought insights to fairgoers

The 2018 Spring Edition of Intertextile Shanghai Home Textiles concluded last week with positive business outcomes generated. Being held during the peak sourcing season for home textiles finished products in China, the three-day show attracted 12% more buyers than last year. A total of 20,870 visitors (2017: 18,596) from 68 countries and regions came to source a wide range of finished products including bedding, towelling and table & kitchen linen.

  • Quality suppliers satisfied buyers with a wide range of sourcing needs
  • Fringe programme brought insights to fairgoers

The 2018 Spring Edition of Intertextile Shanghai Home Textiles concluded last week with positive business outcomes generated. Being held during the peak sourcing season for home textiles finished products in China, the three-day show attracted 12% more buyers than last year. A total of 20,870 visitors (2017: 18,596) from 68 countries and regions came to source a wide range of finished products including bedding, towelling and table & kitchen linen. 232 exhibitors from 11 countries and regions (2017: 204, eight countries and regions) including well-known international brands such as Cotton Council International and Asahi Kasei as well as domestic big names like Ruyi, Sunvim and Yueda participated and praised the show as one of the most effective trade platforms at this time of the year for home textiles industry.

“Thanks to the revitalised market conditions in China and the increased number of buyers, our exhibitors have had a successful show. Not only did they receive onsite orders and make contact with new clients, but they also valued Intertextile Shanghai as a channel to build up their brand so as to expand their business network in China. Apart from the stronger Chinese market, another reason for the buyer increase this year was the large growth of the four concurrent fairs. This resulted in a more diverse buyer profile with increased demand from different textile industry sectors,” Ms Wendy Wen, Senior General Manager of Messe Frankfurt (HK) Ltd said.

Exhibitor opinions:

Mr Wang Si Qi, Representative of Fibers Sales Dept, Asahi Kasei Advance (Shanghai) Co., Ltd, Japan
“We came to the fair to gain exposure and to promote our brand. Since our products are rare in the market and are a perfect substitution for traditional materials, most of the buyers that visited our booth were interested. We succeeded in promoting our brand and letting more industry players know about it. We are really satisfied with the visitor number. People from different sectors with different products in different price ranges are all here. It does help increase our reputation in the industry.”

Ms Allisa Lau, Senior Manager, Chain Supply, Chain & Consumer Marketing, Cotton Council International, USA
“We are happy with the visitor number this year as we made contacts with a lot of manufacturers. Most of them are our target users. The fair has always been helpful for our Council as we can connect with existing clients and explore potential new customers at the same time.”

Mr Trevor Beuth, Managing Director, The Australian Alpaca Bedding Company Pty Ltd, Australia
“We exhibit in Intertextile Shanghai because I believe that it is the premier show in Asia at this time of the year, and it has a wide global reach too. We hope to establish our brand and reputation here at the fair and in China. Our products received very strong interest from Chinese buyers. Overall, we had a very busy show and we are satisfied. We have worked with some major Chinese companies and they came to see us again this edition, but nearly all of the visitors that have come to our booth this time are new to us.”
 
Mr Tetsuo Tosaki, Manager, Tamurakoma & Co., Ltd, Japan
“The reason we come here is that it’s the largest show in Asia at this time of the year, and the Intertextile brand is very famous in Japan. We met almost 100 customers every show day, including manufacturers, brand traders and wholesalers. This show helps us to know our customers better and expand our business in China. The Chinese market is developing rapidly in recent years, so attending this show is a good start for us and the result is beyond my expectation.”
 
Mr Sunwei, Marketing Manager, Shanghai Yueda Xiangyun Home Textile Co., Ltd, China
“Among our visitors, 80% are our existing clients who placed orders directly and the remaining ones are new clients who are interested to be our franchisees. It is surprising that we have received such a huge amount of orders in just two show days. Nearly 90% of our existing clients we met at the show placed orders, and we’ve met more than 10 potential franchisees. This is really a fruitful show as it helps us to connect with old customers and establish new business.”

Mr Gao Qi, District Manager, Sunvim Co., Ltd, China
“This edition we showcased towelling and bedding products especially designed for the 2018 spring season. Intertextile Shanghai is one of the most important platforms for us to launch new products for the year. On the one hand, many suppliers and brand buyers are looking for new items during this peak sourcing season. On the other hand, many quality buyers and decision makers are invited to the show. The visitor flow is high so we can both enhance our brand popularity and receive orders after the show.”

Quality suppliers satisfied buyers with a wide range of sourcing needs. While exhibitors were delighted about meeting new customers and receiving orders on the spot, international and domestic buyers also appreciated the wide range of products they discovered at the fair.
 
Buyer opinions:

Mr Anil Miglani, President, SawHill Intl Ltd (Toronto), Canada
“The show has always been a satisfying one as we can meet some interesting and potential suppliers every time. So far, we’ve found two to three exhibitors that we look forward to working with. As a Chinese fair, Intertextile Shanghai is highly recommended as the exhibitors, domestic ones in particular, are of good quality and friendly to foreign visitors. The product range on offer is getting wider and wider, so I come to this show every year to look for potential Chinese suppliers.”

Mr Abdelkrim Boussehra, Yiwu Mingyu Import & Export Co., Ltd, Morocco
“This is my first time attending this fair. I didn’t know any of the Chinese brands here beforehand, but I think the quality of their products is really good. I met two machine suppliers, TPET & Richpeace, and will place orders with one of them. I’ve been to several shows in China, and I think this one is an effective sourcing platform because I can find everything I want.”

Mr Paul Chen, Business Supervisor, Jiangsu Yueda Hometex R and D Co., Ltd, China
“Compared to the previous editions, there are more and more high level and innovative products. Big domestic brands like Mercury, Goldsun and Bermo are all here and we are interested to work with them. This is an excellent platform that facilitates our sourcing with these exhibitors all under one roof.”

Fringe programme brought insight to fairgoers
Apart from concrete business outcomes, the fair’s fringe programme, including the Intangible Cultural Heritage Zone and a series of forums, further enriched the three-day show. Fairgoers were fascinated by the presentation of unique and traditional textile production and processing techniques from Chinese ethnic minorities in the Heritage Zone. While the forums that discussed topics from consumption upgrade to the newest technology applications were another success as they provided extra opportunities for industry players to share their insights and learn the latest developments.

The next Intertextile Shanghai Home Textiles fair, the 2018 Autumn Edition, will be held from 27 – 30 August at the same venue. Intertextile Shanghai Home Textiles – Spring Edition is organised by Messe Frankfurt (HK) Ltd; the Sub-Council of Textile Industry, CCPIT; and the China Home Textile Association (CHTA). 

30.01.2018

TEXTILE AND CLOTHING MANUFACTURERS INVEST IN EGYPT

  • Chinese companies are planning several major projects
  • Germany is supplying more textile and clothing machinery

Several Egyptian and Chinese companies have announced some heavy manufacturing investments in textiles and clothing. The government is committed to creating new production priorities for textiles and wants to increase added value. Labor-intensive industries benefit from the low value of the Egyptian pound for their exports. For textile and clothing machinery, Germany achieved a delivery share of around 20 percent in 2016. In the Egyptian textile and clothing industry, the signs point to expansion and modernization. Local media reported on a series of investment plans by Chinese and Egyptian companies. According to the newspaper Al Gomhouria, a Chinese producer is planning the world's largest textile factory for USD 6 billion in the economic zone on the Suez Canal.

  • Chinese companies are planning several major projects
  • Germany is supplying more textile and clothing machinery

Several Egyptian and Chinese companies have announced some heavy manufacturing investments in textiles and clothing. The government is committed to creating new production priorities for textiles and wants to increase added value. Labor-intensive industries benefit from the low value of the Egyptian pound for their exports. For textile and clothing machinery, Germany achieved a delivery share of around 20 percent in 2016. In the Egyptian textile and clothing industry, the signs point to expansion and modernization. Local media reported on a series of investment plans by Chinese and Egyptian companies. According to the newspaper Al Gomhouria, a Chinese producer is planning the world's largest textile factory for USD 6 billion in the economic zone on the Suez Canal. The Chinese companies TIDA and Shoon Dong Roy want to build a clothing factory for USD 800 million. Sino-Egypt Minkai plans to build a textile industry complex for around USD 750 million. The local paper and stationery manufacturer Mintra plans to start the production of sports shoes with an initial investment of USD 50 million. Manufacturing in the 10th of Ramadan City is scheduled to begin in mid-2018, serving both the domestic and overseas markets. Egypt is still importing about 85 percent of the shoes sold in the country.
Oriental Weavers plans to purchase new production lines, machinery and equipment in 2018. For this purpose, EUR 6 million are to be invested. According to the newspaper Al Shorouk, the expansion will be financed by a bank loan.

State relies on new textile cities and more value added
The Egyptian state also wants to strengthen textile and clothing production. The Ministry of Investment and International Cooperation, the Supreme Council for Textile Industries and an unnamed Chinese partner want to set up a free zone for textile production in Minya. The ministry plans to provide part of the funding through international institutions and create specialized training programs for workers. According to media reports, the project value should be at USD 324 million.

In early 2017 the Egyptian Ministry of Industry announced that it would set up new textile production centers at a total of ten locations. In particular, spinning mills and weaving mills are in the spotlight. This perspective is shared by the Ministry of the Public Sector. It is aimed primarily at increasing value adding and therefore carried out a study in 2017.

Import demand for textile and clothing machinery is expected to increase
Egyptian textile and clothing companies often produce with a lot of manual work and partly outdated machines. On the one hand, the government is keen to ensure that as many jobs as possible are created for the approximately 800,000 young people who enter the market each year. On the other hand, a more automated and modern production of textiles and clothing would enable more complex products. These could be sold at a higher profit, but may also require less human labor.

An Indian company has secured a contract to modernize cotton processing. In compliance with a framework agreement with the Cotton and Textile Industries Holding, Bajaj Clothing automates cotton ginning systems. A total of eleven companies in different parts of the country will be equipped with the new machinery until August 2018. In late December 2017, Egypt Today announced that the government wants to modernize the spinning and weaving mills in Northern Egypt. The investment volume will amount to a total of one billion Euro over a period of five years.

The newly announced projects are expected to increase the demand of import machinery in the near future. Like other types of equipment, the vast majority of textile and clothing machinery will be imported into Egypt. Deliveries from Germany were able to improve both in absolute terms and relatively in 2016, despite an overall shrinking of the volume of imports. The German supply share jumped from 15.8 to 20.4 percent compared to 2015.

Import of textile and clothing machinery into Egypt (in USD  1,000)
HS Category 2015 thereof from Germany 2016 thereof from Germany
8444 1,135 0 4,481 2,025
8445 34,550 10,653 26,105 5,429
8446 18,902 984 23,591 13,346
8447 26,040 5,940 15,713 3,052
8448 23,39 5,158 20,574 3,365
8449 440 0 299 0
8451 34,796 3,335 36,512 2,334
8452 30,456 1,264 23,186 1,698
8453 3,087 5 3,678 137
Summe 173,145 27,339 154,139 31,386

Source: UN Comtrade

The consequences of the release of the Egyptian pound in November 2016 will mainly benefit labor-intensive industries and those that are processing mainly local raw materials. After October 2016, the value of the EURO soared from just under 9 to 21 Egyptian pounds and has stabilized at this level. According to various figures the textile and clothing companies in the country employs between 1.0 and 1.2 million workers. It is reported that state-owned enterprises are strongly represented in the textile sector, while the private sector plays a greater role in the clothing sector.

The advantage is dampened by the import requirements for cotton. In Egypt, especially soft and high-quality long-staple cotton is grown and exported. By contrast, domestic textile and clothing companies mainly use short-staple cotton from abroad as a raw material. Their import as become more expensive due to the currency developments. Nevertheless the competitiveness of Egypt's textile and clothing exporters has improved as a result of the new foreign exchange situation. Their exports should have developed better in 2017 than at the peak of the currency liquidity crisis in the previous year. At that time, exports fell by12.6 percent to around USD 1.7 billion.

Egyptian exports of textiles and clothing
(Selection, in USD millions, Change in %)
HS Category 2015 2016 Change 2016/2015
57 339.8 303.5 -10.7
60 2.0 35.7 1,685.0
61 483.6 388.0 -19.9
62 870.4 756.6 -13.1
63 262.2 227.2 -13.3
Summe 1,958.0 1,711.0 -12.6

Source: UN Comtrade

Increasing labor costs at Asian production sites, long transport routes and sometimes dissatisfaction with the product quality make some customers look for new sources of supply for textile and clothing products. According to a report by the news portal Middle East Eye, Egypt lies at least with USD 100 as a monthly salary for workers roughly equivalent on a level with India or Bangladesh and about half of Chinese salaries. In addition, the country at the Suez Canal is capable of fast deliveries to Europe and the United States. Regional competitors include Turkey and Tunisia. Egyptian manufacturers are not always recognizable as such, as they often manufacture for major international brands. Middle East Eye names Calvin Klein, Decathlon, Tommy Hilfiger and Zara as examples. In November 2017, Dice Sport and Casual Wear agreed to supply Levi Strauss & Co. with children's clothing.

Since 2017, Egypt became part of the Better Work Program of the International Labor Organization. The program includes 30 apparel factories in which the working conditions should be improved. Such confirmations could then give Egyptian products competitive advantages in export. However, to stand up to the tough international price warfare and at the same time to meet by the customers expected production standards will be a challenge.

02.01.2018

THAILAND'S TEXTILE INDUSTRY ON NEW PATHS

  • Good chances for synthetic fibers and functional textiles

Bangkok (GTAI) - Thailand's textile industry is in transition and is increasingly positioning itself in new markets with higher added value. Synthetic fibers became an important foothold on the basis of innovative raw materials, while functional textiles are grateful to customers in a dozen sectors. In addition, there is the traditional silk craft, which can be marketed by international design and attractive fashion shows - and this at top prices.

  • Good chances for synthetic fibers and functional textiles

Bangkok (GTAI) - Thailand's textile industry is in transition and is increasingly positioning itself in new markets with higher added value. Synthetic fibers became an important foothold on the basis of innovative raw materials, while functional textiles are grateful to customers in a dozen sectors. In addition, there is the traditional silk craft, which can be marketed by international design and attractive fashion shows - and this at top prices.

The Thai textile industry is changing. As a part of the long-term national development strategy “Thailand 4.0” , new technologies are designed to help innovative products breakthrough in key emerging markets, backed by concerted efforts in design, fashion and marketing. The industrial foundation ensures the availability of a complete value chain from fiber production, yarn spinning, fabric weaving and processing to the production of clothing.
The long-term strategy has been outlined by the Thailand Textile Institute (THTI) in its "Thailand Textile and Fashion Industries Development Strategy 2015-2030". Three phases are planned from the regional center for textile and fashion retail, to the development of creative products for international brands, and finally the breakthrough as the global market leader in fashion design, including Thai components. The concrete catalog of measures includes an industrial fashion zone, a pilot fiber plant, a development center for yarn, fabrics and fashion products as well as a regional fashion academy.

Broad spectrum for innovations
A diversified petrochemical industry with high-quality downstream products provides a rich foundation for a wide variety of synthetic fibers. The main products are polyester, nylon, rayon and acrylic polymers. The range of applications is quite broad, including apparel, medical technique, hygiene and automotive manufacturing. For polyester, Thailand ranks ninth in the world with an annual production of 621,000 tons, the larger producers include Indorama Polyester, Teijin Polyester or Thai Toray.

Increased research and development efforts with both artificial and natural textile fibers are paving the way for functional textiles. There are a dozen applications in this broad future market: Agrotex, Mobiltex, Medtex, Hometex, Oekotex, Packtex, Buildtex, Clothtex, Indutex, Geotex, Protex and Sportex. The leaders in this branch are companies such as Asahi Kasei, Perma, Saha Seiren, PJ Garment or TP Corporation. Thailand also wants to play an active role in shaping the future market of "smart fabrics" - such as fabrics with UV protection or antibacterial and fire-resistant properties.

Renaissance of the silk
On elegant paths also the traditional over generations grown art of silk crafts is moving. Thanks to the rich raw material base, the kingdom is considered to be the world's fourth largest silk producer. In the preference of visitors from abroad, silk products are at the eighth place in the souvenir statistics 2015 with USD 149 mio.
The origins of silk were characterized by the craftsmanship weaving with regional origin characteristics such as at the Lumphun Broocade Thai Silk, the Phu Thai Praewa Silk or the Surin Hole Silk. The change to innovative products took place with the growing demands of customers. New technologies produced goods of higher value, which were also became promoted with new stronger marketing ideas.

Jim Thompson and Passaya are considered two major pioneers of world-class luxury silk brands. Jim Thompson generates USD 72 mio thanks to modern design and premium products. Passaya won international awards for outstanding innovations in design as well as in the production process. Public support has been provided by promotional events such as "Proud Pastra", which recently completed USD 1.5 mio  in trade surplus. The Ministry of Commerce also intends to establish a silk center in the northeastern Korat under the state-sponsored so-called OTOP scheme (One Tambon One Product).

The entire industry has currently  4,700 textile and garment manufacturers with over 500,000 workers, including 730 textile companies for technical textiles. The export value amounted to USD 6.45 billion in 2016, which represented about 3 percent of total exports. The national retail sector recorded steady growth rates averaging 3.5 percent per year over the period 2011-2016.

In addition to production, Thailand also tries to profile itself as a fashion hub for regional and international fashion shows. The most important events are the "Bangkok International Couture Fashion Week", "Elle Bangkok Fashion Week" and the "Bangkok International Fashion Fair". The first national designer brands have already made their debuts on the catwalk, such as Sretsis, Naraya, Dry Clean Only or Disaya. Sretsis, founded by three sisters, became successfully supported by some big names such as Beyoncé, Paris Hilton, January Jones and Zooey Deschanel.

More information:
Thailand
Source:

Waldemar Duscha, www.gtai.de

19.12.2017

Relaunch Textination: Goodbye and welcome!

 With the last working days of the year 2017 at Christmas we have satisfied a desire for us and hopefully also for all visitors and users of the internet portal for the textile industry TEXTINATION:
Textination says goodbye to its old layout and will welcome 2018 with a fresh new look.

 With the last working days of the year 2017 at Christmas we have satisfied a desire for us and hopefully also for all visitors and users of the internet portal for the textile industry TEXTINATION:
Textination says goodbye to its old layout and will welcome 2018 with a fresh new look.

EVERYTHING STAYS DIFFERENT:
As usual, you will find our business information in the form of company overviews, economic data, tenders and market analysis. The job market will continue to help finding new challenges or people who face challenges.
The textile knowledge database TextileTechnology is still at your disposal, just like the new DownCheck database with all the details about down and feathers. And of course, we will keep you posted about dates and events.
 
WHAT'S NEW?
We have cleaned up: the navigation has been revised and streamlined; topic priorities have been newly set. In addition, we have followed the wishes of many companies and have significantly expanded and structured the news area. In future, you will find information or news from the industry that interests you with one click. An extensive archive and an indexing will help at finding.

We offer a platform that optimally supports you in the presentation of your products, developments and innovations – following the motto: we proudly present ...
Show what sets you apart from others.

We wish you, your colleagues and employees a wonderful Christmas and a good start to a hopefully happy, healthy and prosperous NEW YEAR 2018.

Stay curious!
Your Textination-Team. 

More information:
Textination
Source:

Textination

 Ethiopia is considered as investment tip in Sub-Saharan Africa © Pixabay
07.11.2017

ETHIOPIA IS CONSIDERED AS INVESTMENT TIP IN SUB-SAHARAN AFRICA

  • International companies have confidence in government work
  • Chinese set the tone

Nairobi (GTAI) - Foreign companies are flowing into Ethiopia and investing in the textile, clothing and leather sectors. Ethiopia is also interesting for companies that assembling simple technical devices. The country does not look good in various international indices, but that does not have to be a contradiction. For some sectors Ethiopia is highly interesting and hope for improvement is always to be hoped for.

Ethiopia is one of the poorest countries in the world and one of many typical developing countries, as there are many on the African continent. The big difference is: Ethiopia is controlled by a regime that is not satisfied with what it has achieved, but is more ambitious: to become a leading, if not the leading, industrialized nation in sub-Saharan Africa.

Model China

  • International companies have confidence in government work
  • Chinese set the tone

Nairobi (GTAI) - Foreign companies are flowing into Ethiopia and investing in the textile, clothing and leather sectors. Ethiopia is also interesting for companies that assembling simple technical devices. The country does not look good in various international indices, but that does not have to be a contradiction. For some sectors Ethiopia is highly interesting and hope for improvement is always to be hoped for.

Ethiopia is one of the poorest countries in the world and one of many typical developing countries, as there are many on the African continent. The big difference is: Ethiopia is controlled by a regime that is not satisfied with what it has achieved, but is more ambitious: to become a leading, if not the leading, industrialized nation in sub-Saharan Africa.

Model China

Despite its geographical location in Africa, large parts of the country's historical and cultural development are strongly influenced from the Middle East. The big role models are therefore not more successful states in Africa but are coming as the United Arab Emirates and China from the East. Thirty years ago, the economic march that Ethiopia is undergoing today, began there: cheap labor, interesting natural resources, enough free land and rivers for energy and irrigation.

The country is thus attractive for labor-intensive industries, especially the textile, clothing and leather industry. A worker in an Ethiopian sweatshop earns an average of USD 909 a year, based on a survey by the US Center for Global Development, compared to USD 835 in Bangladesh, USD 1,776 in Tanzania, and USD 2,118 in Kenya. Another advantage appreciated by employers: In the African context Ethiopian women are considered to be well-educated and less willing to strike.

Special zones of industrial oases

Another location advantage are the industrial zones, which are mostly built by Chinese companies: fencing, strict access controls, no-hole roads, guaranteed electricity and water supply, proper waste and garbage disposal, workers' housing in the area or nearby, shops, banks, medical care. From a European point of view, it may look like exploitation and "big brother", but from an Ethiopian point of view jobs are created, families are fed and foreign exchange is earned.

In July 2016, the Hawassa Industrial Park was officially opened, the largest in sub-Saharan Africa. From here, textiles and clothing are to be exported. By 2018, the park will employ 60,000 workers and generate USD 1 billion in exports. As early as 2030, Ethiopia wants to earn USD 30 billion in this segment. Even if one should not take the last number too seriously, the ambitions are clear and unambiguous.

Another industrial park was inaugurated in July 2017 in the city of Kombolcha. Meanwhile, a whole range of other parks are in various stages of realization, focusing on apparel, textiles, pharmaceuticals and medical equipment, as well as the agro-industry. According to the Ethiopian Government, there is no shortage of interested investors, primarily from China, India, Turkey, the US, Hong Kong and South Korea.

Cheap electricity soon abound

While some of the industrial parks still have to rely on standby generators and the connection to roads and railways leaves much to be desired, long-term remedies are in sight: several large hydropower plants are under construction nationwide, especially the Grand Ethiopian-Renaissance Dam project, which will start up the first generators in the current financial year (July 8th 2017 to July 7th 2018). Upon final completion, the capacity should reach 6,450 megawatts. It would then be Africa's largest power plant - and one of the cheapest electricity suppliers.

There are notable successes in road construction also: since August 2016, Ethiopia has got a first fully commissioned 85-kilometer three-lane highway from the capital Addis Ababa to Adama. Further sections are under construction. And also with the railway there is something to celebrate with a new, 756 kilometers long and continuously electrified route between the outskirts of Addis Ababa and the container port in neighboring Djibouti.

Foreign exchange shortage a big hurdle

This positive development cannot hide the fact that large parts of the country are not yet connected to the electricity net, that the road network is inadequate and the railway line is only a small start. Moreover, the bureaucracy is inflated and inefficient and lacks a functioning constitutional state. Currently, an acute lack of foreign exchange hinders imports and profit transfers, as the ambitious infrastructure projects absorb every available dollar in the country.

Investors, however, are speculating on tomorrow: because the country is on the right track and wants to maintain its course. A steady influx of foreign direct investment shows that international companies have sufficient confidence and want to be among the first. In addition next to the low wages, they are interested above all in the underdeveloped and untapped consumer market of 105 million people. For the South African Rand Merchant Bank, Ethiopia is therefore the fourth most attractive investment destination in Africa after Egypt, South Africa and Morocco (Where to Invest in Africa 2018).

Poor placement in international rankings

Even if Ethiopia is predicted to get a bright future, current negative assessments may not be ignored: in the Global Competitiveness Index 2017 - 2018 of the World Economic Forum, Ethiopia ranks 108th (out of 137). In the Index of the Economic Freedom of the World Heritage Foundation Ethiopia belongs to the group of largely unfree countries in 2017 ranked 142 (out of 180). And in the Doing Business Ranking of the World Bank (2017), Ethiopia is in a poor position with 159 (out of 190). By contrast, in 2016 in the Transparency International's Corruption Perceptions Index Ethiopia ranked 108 (out of 175), making it a lighthouse in an otherwise corrupt region (last place: Somalia 176, South Sudan 175, Sudan 170, Eritrea 164, Uganda 151, Kenya 145, Djibouti 123).

In the Fragile States Index 2017 of the Fund for Peace, Ethiopia ranks 15th, ranking among the most fragile states in the world (lowest rank 1 = South Sudan, best rank 178 = Finland). Ethiopia also scored poorly on press freedom and the rule of law: ranked 150th out of 178 in the Press Freedom Index in 2017 and 107th in the Rule of Law Index in 2016 (out of 113).

Economic data in a regional context
  2016 20171) 20181)
Gross domestic product, in USD billion      
..Kenya 70,5 80,7 88,2
..Ethiopia 70,3 72,1 75,3
..Tansania 47,7 50,5 52,5
GDP growth, real, in %        
..Kenya 5,8 5,1 6,1
..Ethiopia 7,6 6,1 5,7
..Tansania 7,0 6,4 6,0
Import of goods, in USD billion, fob      
..Kenya 13,62) 14,5 15,1
..Ethiopia 16,02) 16,8 17,0
..Tansania 8,52) 8,6 9,0

1) Prognosis
2) Estimation
Source: Economist Intelligence Unit