Meeting focuses on importance of textile trade liberalization
Meeting focuses on importance of textile trade liberalization
The International Apparel Federation held its 13th convention
in Hong Kong on May 12 and May 13. The Jakarta Post's reporter,
Rita A. Widiadana, attended the two-day event at the invitation
of the organization's president.
HONG KONG (JP): The message sounded loud and clear at the
International Apparel Federation (IAF) convention: find effective
ways to liberalize the world's textile and clothing industry.
IAF President Sunjoto Tanudjaja said many developing countries
were looking forward to freer world trade in textiles and
apparel, the total value of which reached US$300 billion in l995,
especially with the gradual abolition of import quotas and tariff
barriers by the year 2005 under the auspices of the World Trade
Organization (WTO).
The 400 participants included Paris designer Nino Cerruti,
Elsa Klensch, style editor of CNN, Gaetono Marzotto of Marzotto
SpA and Indonesian designer Iwan Tirta.
The meeting brought together leaders from all facets of the
industry to discuss global trade, retailing and changing consumer
markets, fashion, new technology, education and training, as well
Asian sourcing.
The primary focus of the event was the key issues influencing
the apparel industry worldwide and the impact of finished fashion
products on different markets.
Indonesian Minister of Industry and Trade Tunky Ariwibowo said
in his keynote address that the global apparel trade is still
dominated by importing countries.
"Many restrictions are still being imposed by importing
countries, which harm the growth of the industry in emerging
countries like Indonesia," he said.
The United States is one of several countries imposing quotas
on textiles imported from various countries, including Indonesia.
About 60 percent of the U.S. imports of textiles and textile-
related products are under the quota scheme.
The textile and garment industry still plays an important role
in Indonesia's non-oil exports, contributing $6.2 billion, or
13.6 percent, to the country's total exports in l995. The
nation's textile and clothing exports increased to $6.8 billion
last year.
Tunky said importing countries were still imposing various
forms of protectionist measures, including anti-dumping
regulations, which contravene the Agreement on Textiles and
Clothing (ATC) reached in the Uruguay Round of trade
negotiations.
He explained that the ATC, aimed at liberalizing the world's
textile and clothing trade by the gradual abolition of import
tariffs and quota arrangements, promised more business
opportunities and jobs for developing countries.
"It is important for the WTO to review and tighten the
guidelines on when and whether a product is dumped," he said.
Richard Hughes, a director at the WTO, admitted that
developing countries still have to work hard to solve complex
problems related to their textile and clothing industry.
Mamoru Hashimoto, vice chairman of the Kansai Economic
Federation, acknowledged that under the Multi Fiber Agreement
(MFA), important GATT principles on textile trade were not
applied strictly.
"We can expect that textile trade will become more liberal,
especially after the transition period," Hashimoto said.
Sunjoto, who is also president of Jakarta-based PT Great River
International, said local textiles and textile-related products
are having trouble maintaining their competitiveness on the
global market.
"The high costs of inefficiency and the bureaucracy have
affected local producers' competitive edge," he said. "High
interest rates, high tax rates, various legal and illegal levies,
as well as increasing tariffs of electricity, telephone and water
supplies, are also burdening our textile industry very much."
To boost Indonesia's textile exports, Sunjoto emphasized the
importance of overseas promotion and bilateral discussions
between major importing and exporting countries.
"This year's convention is very important to boost the growth
of our textile and garment industry. Here, we can meet prominent
industrial executives from all over the world," he said,
As the president of IAF, Sunjoto promised to do his best in
promoting Indonesia's textile and clothing exports worldwide.
"Currently IAF's members countries are mostly from developed
countries," he said. "But they are our important buyers. I have
been trying hard to draw memberships from developing nations so
that we will have strong bargaining positions in this
organization."
Asia
The meeting also discussed the map of the international
textile and clothing market in the coming 21th Century.
Ken Watson, director of the United Kingdom Apparel & Textile
Challenge, believes that Asia will become the most important
consumer market for the next millennium.
"Asia as a consumer market offers the greatest growth
potential over all other continents as a result of its high
population base and its high economic growth," Watson maintained.
He continued that market opportunities were already present.
"The producers will become stronger and, therefore, strategic
alliance with the Asian region is a necessity."
He also said there is a strong consumer base in Asia as more
than 60 percent of its population (excluding Japan) is aged
between 15 and 65, and rapidly absorb news international fashion
trends.
Watson categorized the global textile and clothing markets as
falling into four groupings of the Mature Economies, First Wave
Tigers, Second Wave Tigers and Emerging Markets. Each has its own
opportunities and challenges, he added.
The Mature Economies and First Wave Tigers include Japan, the
United States, Canada, western European countries, Hong Kong,
Singapore, South Korea and Taiwan.
Japan is a mature market with changing patterns of
distribution due to the emergence of new suburban retail shopping
centers and a shift in consumer demand favorable to competitively
priced imported products. This market, however, is notorious for
its complex distribution systems.
Hong Kong, one of the most sophisticated retailing centers in
Asia, is seen as a major stepping stone to the larger Chinese
market for the next millennium. Singapore is still an important
center for the region, while South Korea and Taiwan have less
well-developed retail market as a result of historical tariff
barriers (now largely removed) and unavailability of appropriate
retail space.
In the Second Wave Tigers, such as Indonesia, Malaysia and
Thailand, exposure to Western lifestyles is rapidly changing
consumer demand and local retailers are adopting the successful
retail format of Western countries.
The development of mega shopping malls in such countries have
had major effects on the lifestyles.
The Emerging Market like China is still hampered by complex
regulations, inadequate distribution infrastructure,
inexperienced local management and lack of suitable retail space.
Despite these shortcomings, Watson suggested that Asia must be
a fundamental part of the global strategy both in manufacturing
and retailing. The growth of manufacturing within the region is
impressive, often with the latest technology and supported by
skilled and adaptable workforce.
Strategy
While the apparel business is no longer limited to the
national borders, companies are forced to develop international
strategies and experience.
Tom Edge, a member of the IAF's Training Committee, maintained
the importance of human resources development.
"People are the key to achieving market demands -- in whatever
country or culture. People can affect cost, quality and
efficiency," he noted.
He continued that the products must be of high quality in
terms of designs and manufacturing with keen prices and prompt
delivery to the market.
A well-trained workforce is important to support the industry,
he said. Successful companies which attract best personnel are
those which have developed successful training and education
programs for all levels of staff, as well as those which
continually adjust to the latest management and technology.
Issues dealing with human resources development, management
and technology will also be the three most important subjects at
next year's IAF Convention in Florence, Italy.
Gaetono Marzotto, the future chairman of the l998 IAF
convention, stated: "I want to encourage all member countries to
send their best personnel of all levels to absorb valuable inputs
from the next convention which will focus more on human resources
development."
Regardless of what technology and global trade system is being
developed, consumers remain the most valuable assets to the
textile and clothing industry.