Archive for November, 2008
The Columbian, WA
Wednesday, November 19 | 4:35 a.m.
The Associated Press
A North Carolina textile company says it is laying off white collar workers in its home city as part of a cutback that includes closing a yarn plant elsewhere in the state.
Hanesbrands Inc. announced Tuesday cuts of 210 corporate and management jobs across the company, including 155 positions in Winston-Salem.
Hanesbrands said half of the cuts are in purchasing, production planning and development and quality control. The other half are in customer management, finance, human resources, information technology and marketing.
The company said it also will close a yarn plant in China Grove in Rowan County by the end of the year and eliminate 185 jobs.
“Some of the employees were affected immediately, some will be by the end of the month, some by the end of the year, and some early next year,” said Matt Hall, a spokesman for Hanesbrands.
Hanesbrands has said it would take up to $250 million in restructuring charges by next September as it reduces domestic production and increases it in Central America, the Caribbean and Asia. The company said it would close nine plants in five countries and lay off about 8,000 employees, or 12 percent of its work force.
In China Grove, the news hit hard.
Town Mayor Don Bringle, who worked at the plant 27 years, said there had been speculation about its fate after Hanesbrands closed a plant in Gastonia earlier this year.
“It couldn’t come at a worse time with the economy being what it is,” said Bringle, who was a vice president when his job was eliminated in 2000.
Hanesbrands manufactures apparel including underwear and casual clothing. The company’s brands include Hanes, Playtex, L’eggs and Bali.
The company said it will continue yarn production operations in Mountain City, Tenn.; Rabun Gap, Ga.; Galax, Va., and Sanford.
November 20th, 2008
Yahoo, Thailand
HANOI, Nov 19 Asia Pulse - Vietnam’s garment sector has enjoyed strong growth in the two years since the country’s WTO accession despite facing stiff competition, according to participants at a seminar in Hanoi on November 18.
Phan Chi Dung, Director of the Ministry of Industry and Trades Light Industry Department, said that the garment sectors most noteworthy achievement has been to increase its export turnover to more than US$7.8 billion in 2007, more than double the 2004 figure and accounting for 15 per cent of the country’s total export revenue.
The result has helped lift Vietnam to ninth position among the world’s biggest garment exporters, he added.
The sectors growth rate was maintained during the first ten months of this year, with total export turnover reaching US$7.64 billion, up 20.3 per cent over the same period last year. This figure is predicted to reach US$9.5 billion for the whole year.
The US remains Vietnam’s largest garment importer, contributing 57 per cent of the country’s export turnover, followed by the EU with 18 per cent and Japan with 9 per cent.
As one of the nation’s largest hard currency earners the garment sector has made major contributions to ensuring employment for local workers. There are now around 2,000 garment businesses in the country providing jobs for more than 2 million workers
To attain their goal of recording US$12 billion in total export earnings by 2010 Vietnamese garment companies should draw up suitable business strategies in order to make the best use of their competitive advantage, said Dinh Thi Ty, a representative from the Vietnam Textile and Apparel Association.
She also said that the association plans to coordinate with authorised agencies to create the sectors development strategy and strengthen international cooperation and trade promotion activities in an effort to expand the flow of Vietnamese products into the global market.
November 19th, 2008
China Daily, China
By Yu Hongyan (Chinadaily.com.cn)
The financial crisis has seen some companies in the textile and garment industry facing shut downs, while other factories struggle to transform their business
“To survive is a victory” has become a consensus among factories in Fujian province, one of the most important centers in China’s textile and garment industry.
“Garment factories of around fifty to sixty employees have almost died out and those with 200 or 300 employees are also on the brink of ceasing production,” said a local industry insider to the Beijing Morning Post. He blames an overdependence on exports that made these enterprises vulnerable in the face of the financial turbulence.
Statistics have it that among thousands of garment and textile factories centered around Quanzhou, Fujian province, nearly half are export-oriented, and the declining market is hitting the industry hard.
Orders from abroad have evaporated in the wake of the global decline and some companies are confronted with the cancellation of previous orders. “The cancellation rate is very high and buyers are finding every possible excuse to do so,” said an owner of a local garment factory to the paper.
“The situation next year may be more rigorous.”
As many industry insiders predicted, the real impact of the financial crisis may be revealed later in 2009.
In a wave of companies shutting down, survival has become the paramount task for many garment and textile factories, as they find new ways to break out.
Local factories in Jinjiang, a city in Fujian known as “China’s shoe capital”, are turning back to the road of OEM (Original Equipment Manufacturer) by providing supportive service and processing to sizable enterprises.
Others have begun to focus on the domestic market, which has proven not an easy way to go. “The operating cost is too high to enter domestic stores” said a spokesman from a company that decided to fall back on the domestic market. Another concern is the adjustment of product mix to cater to Chinese consumers, he said.
However, in a global downturn where some see troubles, others find opportunity. The apparel giant Nike is set to add five production lines in Quanzhou, owing to the closure of some Nike factories in Thailand, as well as the advancement of the coastal city’s production chains and technologies.
Taking advantage of the appreciation of the yuan, some enterprises in Fujian have already begun to upgrade their equipments. “We are seeking every opportunity to rebound,” said Lin Xiangyang, general manager of a children’s wear manufacturer.
To help China’s textile industry go through the global slowdown, the Chinese government has taken several favorable measures this year, by raising export rebates and tax cut.
November 18th, 2008
The New Nation, Bangladesh
UNB, Narayanganj
A garment worker was hacked to death allegedly by some fellow workers at Delpara under Fatulla thana on Friday night.
The deceased was identified as Azizul Huq, 16, hailed from Shahbazpur village in Mymensingh district. He was a worker of ZM Apparels.
Police said Azizul was severely hacked by some of his fellow workers behind the garment factory at about 8pm just after he came out of his working place. They also severed tendons of legs and hands of Azizul, leaving him seriously injured.
Azizul was rushed to Dhaka Mdical College Hospital where doctors declared him dead.
Meanwhile, people caught one of the suspects of the incident alongwith a knife and gave him a good beating before handing over to police.
Fatulla thana OC Khan Atiqur Rahman said the killing might be a sequel to the previous enmity.
___
November 17th, 2008
Staff Reporter
Hindu, India
ERODE: “Yes, we intended [to place] more quantities than ordered…the reason is simple the economic situation in Europe is not good enough and textile business has been affected,” this was a European buyer’s response to an Erode-based garment exporter’s email.
The exporter had asked the buyer why he had halved his order for the current year.
Similarly a Denmark buyer had mailed, “There is a general slowdown in the economy here as in Europe. And for sure, many shops and wholesale traders will close down.”
Statements
The aforementioned buyers’ statements reflect the garment export business. Secretary of the Textiles and Garments Exporters Association, Erode, S. Sivananthan says slump in the world economy has hit the garment export business hard.
The slump in textile trade means the buyers have not only cut down their orders but also reduced the delivery time.
“Buyers want to have a short production cycle, so that they make money quickly. This has resulted in reduced order time from 90 to 120 days to 60 days.”
Not only that, some buyers have delayed placing orders. “Earlier, the buyers placed orders in October or November, for January shipment. This time, though, a few of them are yet to place orders,” Mr. Sivananthan says. This is true of most of the garment exporting units here.
This is only one part of the story.
The second is that though the rupee has fallen vis-a-vis the dollar in the past few months, the cut in duty drawback rates and increase in interest rate for packing credit have offset what ever profits the exporters could have made.
Restored
“Earlier the duty drawback was 15 per cent. The Government brought it down to 11 per cent and then to about seven. This was restored to 11 per cent, after exporters’ associations petitioned the Government. Now again, since September 1, the Government has slashed it to 8.8 per cent,” the export association secretary says.
Lending rate
Similarly in packing credit, the Government has hiked the lending rate. From 7.5 per cent in 2007 to 10.5 per cent earlier this year, the Government has made it on a par with other interest rates, he adds.
Mr. Sivananthan says he wants the Government to provide concessions in duty drawback and packing credit, so that the garment exporters can make use of falling rupee.
November 14th, 2008
MarketWatch
DUBLIN, Ireland, Nov 13, 2008 (BUSINESS WIRE) — Research and Markets ( http://www.researchandmarkets.com/research/7faaee/the_clothesource_g) has announced the addition of the “The Clothesource Guide to Apparel Trade Regulations: Second Edition” report to their offering.
With a looming recession, and more and more talk of protectionism, it’s important for apparel buyers and sellers to keep on top of the changing rules on import duty and quotas.
This best-selling Guide has been updated in November 2008 to include all agreements signed by the EU and US up to the end of October 2008, and to review commitments made during his campaign by US President-elect Obama.
It summarises all the special duty concessions, quotas and penal import duties that the EU and US create to encourage or deter apparel imports from other countries. It provides:
- Clear lists of countries eligible for duty free clothing access to the EU and/or US — including details of the 30 “double-barreled” concession countries, which qualify for duty-free access to both the EU and US.
- Equally clear lists of other trade concessions and barriers.
- Easy-to-follow explanations of the workings of many schemes in the EU and US operate.
- Detailed, scheme, by scheme, reference to explanations of each scheme in the finest detail
- A simple analysis of the cost benefits to importers of the concessions or barriers each exporting country faces — allowing for differences in each country’s basic level of pricing.
- An easy-to-follow explanation of possible changes to each scheme, and the likelihood of such changes.
The guide provides a clear outline both of concessions (like America’s DR-CAFTA or the EU’s Economic Partnership Agreements) and of barriers (like anti-dumping duty).
For an additional fee, we will provide you with a regular briefing on changes which have occurred, with an automatically updated copy of the guide. Updates will be monthly, or more frequently if there are major changes, and will last for one year.
Key Topics Covered:
- The Basic Principles
- The major incentives and barriers: Access to the US
- The major incentives and barriers: Access to the EU
- Country options
- Country-specific trade barriers and trade preference agreements
- Likely Changes to the schemes
For more information visit http://www.researchandmarkets.com/research/7faaee/the_clothesource_g
SOURCE: Research and Markets
November 14th, 2008
BusinessDay, Nigeria
The productive capacity of the sector is so low to the extent that about 90 per cent of textiles fabric needs of the country is being fed through importation.
As year 2005, the contribution of the industry to GDP dropped to less than one per cent. The market share of the industry equally dropped from 27 per cent in 2003 to 15 per cent in 2005.
The implication of this is that Nigeria now depends almost wholly on the outside world for her clothing needs. Studies carried out on small scale traders in Nigeria by analysts show that the country spends a minimum of about $158.4 (N19 billion) annually on importation of fabrics and textiles from Dubai alone.
This figure can be up-scaled six times if we consider imports from such countries as China , India , Turkey, Hong Kong, Malaysia and other textile producing countries, analysts say.
Perhaps we will better understand the dilemma Nigeria is in and start seeing the textile industry as a huge foreign exchange earner if we understand the fact that China’s textile industry, the largest in the world, contributed about $420 billion (N49 trillion) to the country’s GDP. Exports of China industry were valued at $178 billion (N21 trillion) in 2007. We must therefore, as a matter of urgency, wake up from our slumber.
The problem with Nigeria is lack of political will. For us, political will is zero in every facet of the economy. It is lack of political will that is keeping Power Holding Company of Nigeria crippled. It is lack of political will that has made government to turn deaf ears to calls by experts for the replacement of dilapidated oil pipelines. It is this same culture that has made Ajaokuta unrealisable.
Only last year, the Nigerian textile sector sacked 10,000 staffers. According to Oladele Hunsu, first national vice president of the National Union of Textile, Garment and Tailoring Workers of Nigeria (NUT-GTWN), some of the factories cut down their workforce from 500 to 250, and some from 800 to 400.
By 1996, the workforce (direct employment) in the industry was close to 140, 000. The figure has sharply dropped to 25,000. In all, over 500,000 allied jobs have been lost to the redundancies and plant closures in the industry within the last two decades.
Inconsistency in government policies, lack of protection of home industry due to globalisation and liberalisation policies, high interest rate, power crisis and high cost of fuel which have led to sharp rise in cost of production, are said to be responsible for the problem in the industry. The situation is such that the high cost of production in Nigeria has made the textile products less competitive.
It is the same picture across the entire manufacturing sector. For instance, Business Day investigation has revealed that some local plants engaged in the manufacture of foundry products have shut down and some are on the verge of being shut down as Chinese and Taiwanese manufactured foundry products flood Nigerian market unchecked.
The cases of Michelin and Dunlop, both tyre manufacturers are still fresh. Nigeria ’s harsh operating environment forced Michelin to close shop while it made Dunlop to scale down its operations.
The main death knell hit the manufacturing sector of which textile is a key unit during the period between 1999 and 2007 when the nation wholly diverted attention to partisan politics, oil and gas as well as bank capitalisation. The period between 2004 and 2007 witnessed the much vibrated politics of succession and bank recapitalisation. This shift negatively affected the power and manufacturing sectors.
According to Felix Adeduro, managing director/CEO of Banquaires Facilities Int’l Limited, who spoke exclusively with Business Day in Lagos , the bank recapitalisation drive had altered the consumption patterns and capacity of Nigerians. “Huge funds that ordinarily should be channelled to stimulate effective demand for manufactured products were diverted into acquisition of shares of the banks.” The manufacturing sector has therefore, by extension, been starved of funds.
Adeduro, whose company is currently on a strategic robust drive to revive Nigeria ’s ailing textile industry, said the textile industry received the worst blow within the stated period when the importation of trendy and cheap textile products and wears assumed notorious dimension.
He said the fortunes of local plants, many of whose systems, equipment, and management have lost touch with modern trend in terms of efficiency, patterns and textures nosedived.
A key element of Banquaires Facilities International Limited’s campaign is the immediate launching of textile industry Roll-back Initiative to associate with and complement government’s huge efforts to revamp the industry.
The major focus of this initiative will be to galvanise wide private sector-driven efforts to bring back the fortunes and lost glory of this vital sub-sector in line with government policy and plans. This is welcome.
There is a dear need to breathe life into our ailing textile sector. One is not oblivious of efforts that were made in the past to revive this comatose sector.
It can be recalled, for instance, that the administration of ex-President Olusegun Obasanjo inaugurated a committee to source for N50 billion to disburse to textile firms as soft loans.
This amount was written off then by industry analysts as one that fell short of what the textile industry needed to get back in business. But the same analysts agreed that it was a departure from government’s traditional commitment to the Bretton Woods Institutions thinking, that is, an imposed neo-liberal dogma which thrives on the blanket disapproval of any form of government interference in business.
The Umaru Yar’Adua administration promised N70 billion bailout for the bedeviled textile industry falls into the same class. The Obasanjo government was not wholly committed to the economic reform content of the so-called Washington Consensus of the Bretton Wood Institutions, which stresses, among other recommendations, that government should get out of the way of business and allow market forces to drive the economy and promote competition and innovation.
For the consensus, the role of government should be the provision of a pro-business environment and an investment-supporting infrastructure.
Recent events have proved that bailouts are the order of the day. The United States doled out $700 billion, the UK, 37 billion pounds, the Chinese came out with a $586 billion stimulus plan, Germany $135 billion, and Norway $56 billion.
Analysts have written off Bretton Woods. One of them holds the view that a system that was designed 64 years ago has, not surprisingly, proved ill equipped to deal with the fiendishly complex practices of 21st-century banking that led to the current worldwide crisis. It is believed that neither the IMF, the World Bank nor any other institution has the power to police the global financial system in a way that might have prevented the excessive risk-taking which led to the sub-prime mortgage crisis and, in turn, the credit crunch.
Another argument is that a more recent creation, the G7 Group of industrialised nations, looks hopelessly out of date without the emerging economic giants of Brazil , India and China among its ranks. And the “beggar-thy-neighbour” policies of guaranteeing savings that have sprung up in Germany, Greece and Ireland in recent days have shown that even in Europe, co-coordinated economic policy is a myth.
Gordon Brown, British prime minister, argued as long ago as January 2007 that global regulation was “urgently in need of modernisation and reform”.
Nigeria will therefore be acting right if it ignores Bretton Woods which has glaringly lost steam. The Indians and the Malaysians have scorned some of the damaging prescriptions of the Bretton Woods Institutions while implementing aspects of their reform package that are politically and economically safe, and suited to their peculiar economic challenges. Nigeria should do the same. We can do same; nothing stops us from doing so.
Let the government robustly support the textile sector. It should vigorously enforce the ban on contraband textile importation, and grant more concessions and waivers to the Nigerian textile industry. It is time to retaliate against harmful Western tariffs and subsidies by imposing tariffs against government-subsidized cheap textiles from the West and Asian countries.
November 14th, 2008
SINDH TODAY, Pakistan
By Sindh Today
Noida, Nov 12 (IANS) Around 250 permanent employees of a garment export unit have been laid off in what is perceived to be a consequence of the prevailing economic sluggishness, the workers say.
Though the sacked employees claimed it was part of the company’s cost cutting measures, the management termed the exercise a consequence of the employees’ ‘indiscipline’ in carrying out their work.
When the workers of AMS Fashions Pvt. Ltd. reached the unit’s office at about 9.30 a.m. Wednesday for their normal day’s work, they were surprised to receive the suspension notices.
The trouble began about 15 days ago, the workers said.
‘We were initially given double overtime and food worth Rs. 20 per meal. But, since last week, our overtime was almost halved and the food served was also reduced to Rs. 15 a meal. We resented this move and the dispute deepened Tuesday,’ said R.P. Singh Chauhan, an AMS worker and member of the Hind Mazdoor Sabha (HMS).
‘Our talks with the management were scheduled to be held on Wednesday. But we were shocked to see an altogether different picture,’ he said.
‘The company had kept a plain paper at the factory’s reception outside the gate and asked us to sign it unconditionally. We were told that we would be allowed to enter and work only if we signed the blank paper. The company further told us that we were laid off by the firm and there was no need to report for duty. This hurt us all and we protested against the company’s decision,’ Chauhan told IANS.
The company’s senior management, when contacted, had an entirely different story to tell. The firm clarified that the move was not taken in view of the financial crisis.
‘Some of the workers were misbehaving with the top management of the company for the last few days, which was totally against the discipline of our working. The actual scene was not what the workers presented,’ a senior member of the firm’s HR division said, not wishing to be named.
‘The workers were being given double overtime till now and their food costs were not decreased but raised from Rs. 15 to Rs. 20 a meal. The workers were demanding one hour lunch time in between the overtime and they wanted this as well to be paid,’ the official added.
November 13th, 2008
Business Standard, India
Indian textile firms turn to Pak, US for cotton
Vinay Umarji & Kalpesh Damor / Mumbai/ Ahmedabad
With the international cotton prices getting attractive, textile companies have begun importing the commodity heavily from overseas markets, especially Pakistan.
Apart from the neighbouring country, India has also begun importing from Argentina, Brazil and the US on account of lower prices. As compared to domestic rates, the imported cotton offers a benefit of Rs 2,000 per bale to these textile companies.
Thanks to a 40 per cent rise in minimum support prices (MSP) for cotton, the domestic prices seem far fetched compared to international prices, thereby tempting textile firms to import rather than source from domestic market. For instance, Ahmedabad-based Aarvee Denim & Exports Ltd. recently imported around 15,000 to 20,000 bales of cotton from Latin America. “The international prices have been so attractive that in our recent import we earned a profit of Rs 2,000 per bale. Apart from high MSP, the recent cut in import duty has worked in our favour,” said Ashish Shah, managing director of the denim major.
Shah added that countries like Pakistan, Argentina and Brazil have been offering cotton at some attractive prices and luring cotton importers across the world.
According to Abhinava Shukla, general secretary of Ahmedabad Textile Mills Association (ATMA), the recent suggestion by textile ministry for farmers to hoard cotton and not jump immediately into sales has also resulted in lower supply of cotton. “With the farmers now hoarding cotton in expectation of better prices, the textile firms seem to have been prompted to import cotton. The benefit from importing cotton rather than buying from domestic market is, however, shortlived since cotton prices may settle down in India soon,” said Shukla.
Many mills from North India have started procuring cotton from Pakistan due to lower prices. Pakistani cotton at present is cheaper by around Rs 4,200 as compared to Sankar-6 variety of cotton in India. Inaddition to this, there is no import duty on cotton, which has lured the Indian mills to go for cotton imports, said Arun Dalal, owner of an Ahmedabad-based leading cotton trading firm Arun Dalal and Co.
Cotton prices have remained firm from the beginning of the season. Though cotton prices in Gujarat had tanked to a low of Rs. 21,000 per candy but the prices rose after Cotton Corporation of India (CCI) had started purchasing cotton at Minimum Support Price (MSP). On Tuesday, cotton prices were quoted at Rs. 22,200 to Rs. 22,400 per candy in various markets of Gujarat.
November 12th, 2008
Bernama, Malaysia
KATHMANDU, Nov 8 (Bernama) — In a major policy reverse, India has rolled back its decision to impose customs duty on maximum retail prices (MRP) of Nepali garments exported to India and will now levy tax on the price indicated on the customs invoice.
Quoting Saturday’s The Kathmandu Post, the Press Trust of India (PTI) reported that this means Nepali exporters will be paying between half to two thirds less duty to India.
According to Nepali Garment Exporters’ Association, the amount of duty paid will come down to around 4 million Nepali rupees (some US$52,631) from 12 million rupees (some US$157,894) going by estimated annual apparel export of 100 million rupees (some US$1.3 million) and on the basis of 4 percent customs duty.
“The central government of India has issued a notification in this connection, rolling back the unfair decision,” said Uday Raj Pandey, Vice President of Garment Association of Nepal.
The decision has come as a great relief to Nepali exporters, said garment entrepreneurs, who added that the sudden decision by Indian customs in the last week of August this year to charge customs duty on MRP instead of the invoice rate had created unnecessary hassles.
“With the fresh decision of the southern neighbor, the duty volume on Nepali apparel will decrease two to threefold, and that means our competitiveness will strengthen in the coming days,” Pandey told the daily.
MRP is always higher than the invoice rate — the price at which producers deliver products.
India’s abruptly imposed customs policy in August had left some 40 million rupees (US$526,315) worth of consignments stuck at Panitanki — the eastern customs point in India, impacting orders already in the pipeline.
Nepal exports more than 100 million rupees worth of readymade garment to India, which has emerged as a major importer in the last couple of years.
India has been imposing 4 percent customs duty on Nepali cotton garments and 8 percent duty on polyester garments.
It has also been levying an additional 4 percent countervailing duty on these exports.
Apart from the base price, experts said Indian customs had also announced they would only accept laboratory test results by New Delhi-based quality certifiers.
The bilateral trade regime governing Nepal-India trade allows duty-free market access to Nepali exports, except for three items in the negative list and five items on which there are quantitative restrictions.
Officials said readymade garments fall neither in the negative, nor quantitatively restricted list.
Rising demand in India — the vast South Asian economy — has brought resilience to the Nepali garment industry, which was on the verge of collapse due to falling markets in western countries.
— BERNAMA
November 11th, 2008
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