Uncertainty in EU and US textile and clothing markets continues to depress world trade

Textile and clothing markets are likely to remain subdued in 2012, given the considerable uncertainty in the global economy, and the fact that the debt crisis in the eurozone continues to hit business and consumer confidence, according to Issue No 156 of Textile Outlook International from the global business information company Textiles Intelligence.
In the EU economy, the recovery which started in 2010 is expected to be snuffed out in 2012. Forecasts suggest that the EU economy will suffer a second dip in 2012 with GDP down in real terms by 0.5%. A partial recovery is predicted for 2013 but GDP is expected to grow by only 0.8%.
The views of European textile manufacturers reflect this outlook. Having reported a notable recovery in their markets in 2011, the recovery slowed markedly in the last quarter of the year and the view now is that the effects of Europe's economic turbulence will continue to have an adverse effect on trade during the remainder of 2012 and perhaps beyond. Indeed, in the first quarter of 2012, EU clothing imports were down in volume by a dramatic 12.0%.
The prospects for the USA are less pessimistic. In 2012 GDP growth is expected to accelerate to 2.2%, from 1.7% in 2011, before falling back slightly to 2.1% in 2013. Nevertheless, clothing imports continue to be affected, with the volume of imports in the first quarter of 2012 down by 3.9%.
Weak market conditions in the EU and the USA affected exports from several Asian countries in the first quarter of 2012, following strong growth in 2011 as a whole. In Indonesia, for example, textile and clothing exports rose in value by 18.2% in 2011 but fell by 5.2% in the first quarter of 2012. In Thailand, exports rose in value by 7.5% in 2011 but declined by a sharp 15.3% in the first quarter of 2012. And in the Philippines clothing export growth slowed in value to just 1.1% in the first quarter of 2012 following an 11.4% rise in 2011. Export growth also slowed in several other countries.
In India, meanwhile, clothing exports fell in value by a sharp 11.9% in the 2011/12 financial year, which ended on March 31, 2012, having increased by 4.7% in the previous year. Textile export growth, meanwhile, slowed to just 0.4%, having risen by 34.7% in 2010/11.
Reflecting the country's weaker export prospects, Indian GDP growth forecasts for 2012 have been revised downwards. In September 2011 it was forecast that India's GDP would grow by 7.5% in 2012 but in April 2012 this forecast was revised downwards to 6.9%. Furthermore, in the first three months of 2012, Indian GDP rose by only 5.3%, which represented the slowest quarterly growth rate in India for nine years.
The prospects for China -- which has long been an engine of growth for the world economy -- are similar, with GDP growth forecasts lowered from 9.0% to 8.2%.
As a result, global GDP is expected to grow by only 2.1% in 2012 after increasing by 2.5% in 2011 and by 4.1% in 2010.
Nevertheless, emerging markets and, in particular, the so-called BRIC countries -- comprising Brazil, Russia, India and China -- will continue to be the key to sustaining global trade growth over the coming years.
In India, for instance, the domestic market for textiles and clothing is forecast to increase in value by 169% over the ten-year period between 2010 and 2020, from an estimated US$52 bn to US$140 bn.

US VIVACIOUS TEXTILE INDUSTRY OF THE WORLD SLAP BY ASIAN INDUSTRIALIST

July 5, 2011

US textile industry

The textile industry of the United States has changed over the past 20 years. Now high-tech industry and competitive. US have the most modern and productive textile industry in the world.
One of the first realizing that technology – is key to future success in the industry, US manufacturers began to invest huge capital to carry out various research and development of new technologies in production. The result of these investments was the establishment of durable nylon, safe, high-strength aramid fibers, etc.
Changed and the basic rules of production. Large scale, mass production methods, which brought huge profits the last 50 years, now can not guarantee strong position in the market. Consumers demand quality, affordable prices, wide selection of products and rapid response to emerging needs. Therefore, the industry undergoes dramatic changes from mass production of the past to moving manufacturing technologies of the future.
In the future, successful companies must be able to quickly and cost effectively produce large or small number of products in response to market demands.
The future calls for the introduction of a new manufacturing process that allows switching from product to product with zero downtime, whether it’s twisting of the fibers or fabric staining. Success requires technologies that enable companies to produce a small amount to the cost of clothing appropriate to mass production.
And at this stage the company continues to actively invest cash in the hope of future success.
But not all is rosy.
The last few years a large number of light industry companies are trying to find means to survive in the prevailing circumstances. US textile industry is in a protracted crisis. This crisis has its roots in the 1980s and 1990s, err. When governments in many Asian countries had reckless fiscal and economic policies to boost economic growth. And in 1997-98gg. This policy has resulted in that country one after another, experienced the collapse of currencies. Their currency has never been provided and in fact in 2000, began to fall again. Today, the value of national currencies of Asian countries 10 largest exporters of textile products following an average of 40% higher than before the crisis.
As a result, prices for Asian yarns and fabrics have fallen to very low levels. According to the Commission on International Trade in the US between 1996 and 2000. The average price of Asian yarn imported into the country fell by 38%, from $ 3.36 / kg to 2.47. The average price of imported fabrics declined by 32% to $ 1.39 / lm to 1.07. With such artificially discounted imports from Asia has increased many times. Currency devaluations before imports of textiles and clothing from Asian countries were a relatively stable or declining. The industry can not deal with the rapid flow of Asian imports to the US cheaper products, following the devaluation of the currencies of the countries in the Middle East. In 2002, imports of apparel from Asia rose by 7% compared to 2000 since 1996, imports of Asian textiles grew by 85%, while imports of finished clothing – almost 60%.

made in china

In 1996, Mexico has shifted to China from a leading provider of textile and light industry in the US. Deliveries of textiles and clothing from that country cover about 20% of the deficit of the United States. In 2002, the trade deficit of light industry was valued at $ 62 Billion
According to the World Trade Organization; in 2002 the US imported textile industry at $ 78.6 billion, becoming the largest importer in the world. Exports amounted to only $ 16.6 billion
The result of ever-increasing imports is closing more than 250 companies since 1997 the hardest hit North and South Carolina – the main pillar of textile industry in the US. Peaked in 2001. When, after September 11, many businesses have lost orders major US carriers.
Since the crisis the total number of people employed in industry fell by almost 600 thousand people. And every year the number hit by the crisis grows.
To regulate relations in the light industry at the present stage in the US there are three pieces of legislation:
1. Multi-Fiber Agreement (MFA). In order to prevent the destruction of their industries, developing countries insisted on the design of the management of international trade in textiles in a separate document. This design or the trade regime has been formally adopted in 1974 and known as the MFA.
The Purpose of MFA – Provide for a Relaxing Trade World of Light Industry. For the past 20 years MFA regulate imports of products of textile and light industry in the United States through the establishment of annual quotas based on the relations between the countries. In 2005. MFA will be replaced; it will be replaced by The Agreement on Textile and Apparel (ATA).
2. African Growth and Opportunity Act. This law will reduce tariffs on US goods, and exclude a number of textile quotas on products exported from Africa as well as promote American investment in African countries. The bill has not yet been passed by Congress.
3. The Agreement on Textile and Apparel (ATA). January 1, 1995 in the Uruguay Round of WTO negotiations, the Agreement on Textile and Light Industry. If the ATA and textiles and clothing should be gradually transferred under GATT discipline and become the subject of the same rights as the goods of other sectors. Countries that have signed this Agreement shall abolish quotas on imports of certain goods from other WTO members. The integration process began in 1995 and completed in late 2005