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| Sunday, 1 May 2005 |
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Lanka's apparel industry to encounter Chinese onslaught by Elmo Leonard Sri Lanka will shortly encounter the yet unseen post-MFA blues, the repercussions of which will end with the closure of most of the developing world's export apparel factories which would not be able to match China's now apparent quota-free era onslaught. Even before the MFA scrapping, post 9-0-11 witnessed FOB apparel prices falling worldwide, heightened following the clothing trade going global on January 1. China, who was most feared in this new era, has come out with multi-dragon-headed-thrusts, increasing the output of its teamed and teeming millions of workforce, while bringing down costs, unimaginably. China's exports of apparel to USA and the European Union (Sri Lanka's largest markets) during January and February of 2005 increased by $1,556 billion compared to January and February of 2004, past chairman, Textile Institute, Sri Lanka Section, Rohan Kuruppu said. China's prices are now down at an average of 31 percent on major products, whilst underwear prices are down 50 percent as against January and February 2004. China's apparel exports has in the first three months since the removal of quotas, shipped in 15 times more pieces of apparel, than in the three corresponding months of 2004, monitored through the world-wide web. In January and February this year, China exported 434 million pieces more of garments to USA, over the corresponding months of 2004. China's main gains were major garment categories such as trousers (pants), blouses, T-shirts and the like being 486 percent more than in the first two months of 2004. China's shipments of cotton pants during January and February to the United States were 47 million pieces as against nine million pieces in the first two months of 2004. China's apparel exports to the 25-member European Union Nations were up by 82 percent over that of the corresponding months of 2004, according to Chinese Customs data, monitored through the web. China's knit apparel exports to the EU increased to $729 million in January and February 2005 from $370 million in January and February 2004 being a 97 percent increase in value. Following China's colossal surge into the global apparel export arena, the Global Alliance for Fair Textile Trade (GAFTT) has called on the US and EU to move quickly and improve its safeguards against China. GAFTT fears that a number of factories the world over will have to close down, buffeted out by China's export surge. Sri Lanka's January 2005 apparel and textile exports to the USA was $155 million, as against $135 million in January 2004. "Some of these orders were contracted in pre-MFA December," Kuruppu said. The free-for-all multi-trillion dollar export apparel market gone global, has already spoiled the consumer and would take an even greater effort and unimaginable innovation to put right. Buyers are now demanding exceptional value for their products, like lower price and value added features. Manufacturers are already affected by the changes in the retailing industry the world over because they buy brands to give customers more value. However, FOB prices of manufacturers are crashing. The market is evolving into one where the consumer is sovereign. Buyers
are now trying to get manufacturers to give more to their monarch. In such a
situation, the customer will continue to be pampered and keep demanding
lower prices and more value for money. |
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