Apparel Online India Magazine March 1st Issue 2019

ETHIOPIA Building manufacturing opportunities for many countries VIETNAM Growing on product strengths I ndia struggles for quality outerwear, coats and jackets, so what a better option does the country have than Vietnam which is widely known for the same. The apparel manufacturing industry in Vietnam has grown by a whopping 600 per cent in a decade, even though it had used capital from multinational companies to grow instead of domestic funds. Since the manufacturing industry is still growing, Vietnamese manufacturers are more willing to accept smaller order quantities than those in China. At best, factories are willing to produce an MOQ at 250-300 pieces compared to a Chinese factory that generally requires 1,000 pieces. This is great for smaller businesses or e-commerce start-ups requesting smaller production runs. Currently out of the total import of jackets and blazers by US and EU, Vietnam has a share of around 25 per cent (quantity-wise). While for trousers, it is 20 per cent. With regard to export of suits/ensembles to US, Vietnam has share of 19 per cent. UVR (in Euro, per kg) of jackets and blazers is 16.6, for trousers is 19.64 and for suits/ensembles is 18. Here factories offer a wide range of sewn items due to advanced sewing capabilities. Sewing, quality control and packaging are all done in-house, but many of the raw materials like cotton have to be outsourced. Fabric production meets only 15-16 per cent of domestic demand due to lack of domestic cotton suppliers. Every year, garment factories import 80-90 per cent of total cotton demand. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which came into effect recently, was expected to help the economy grow by 1.3 per cent. It should boost the export turnover by 4 per cent. The country is also getting good investments from Taiwan, Korea and China. Top Groups: Fashion Garments, Saitex, Phong Phu Corp., Esquel Garments, TAL Apparels Major Production Hubs: HCM City and Hanoi have most of the garment factories. Major Clients: H&M, GAP, Target and M&S Products ome of the Indian apparel companies, who have explored Ethiopia, are of the view that the overall infrastructure conditions are not good. Although for this, the local Government is taking few steps to improve the infrastructure. It is improving Addis Ababa Bole International Airport, the main hub for Ethiopian Airlines. The expansion is expected to triple yearly passenger capacity from its current 7 million to 22 million passengers annually. Currently exporting US $ 1 billion of garments, the country aims to generate US $ 30 billion by 2025. Babieswear, trousers and tees are the core products of the country. UVR (in Euro, per kg) of babieswear is 12.5, for trousers is 12.22 and for tees is 22.96. Many Chinese companies are investing here as the country has so far commissioned six Chinese-built textile and garment-oriented industrial parks. The logistics services seem to be improving in Ethiopia. Djibouti is the closest and single port used for exports. And it is away from the hub, Hawassa Industrial Park. Djibouti is important to landlocked Ethiopia, which currently imports and exports nearly 90 per cent of its goods through this port. Bringing a container from Djibouti to Addis Ababa takes one day or little more. The Government has reduced the cost of freight and transport to 25 per cent and is about to launch its own transportation company providing trucks that run to Djibouti port. As the Government wants to diversify exports from agricultural products to textile and garment manufacturing, opening of more than 10 industrial parks in different parts are in process. There are backward integration possibilities with raw materials as local cotton is available; cheap electricity, supportive garments, free water are also supportive factors. This emerging hub has trade treaties with China and agreements like Common Market for Eastern and Southern Africa, Africa Free Trade Zone, AGOA. Ethiopia enjoys duty-free quota-free status extended by the international markets including China, India, Japan and Korea. Top Groups: Ayka Textiles, Saygin Dimam Indochine International, New Wide Garments, Atraco Group Major Production Hubs: Hawassa, Tigray, Bole Kefle Major Clients: PVH, Guess, Levi’s and H&M DECODING DATA India’s import during 2018-2019 (Apr-Nov) S LANGUAGE (Values in US $ Million) Bangladesh Cambodia Ethiopia Indonesia Myanmar Sri Lanka Vietnam Knitted 55.44 8.70 0.00 3.46 0.97 21.08 8.72 Woven 184.26 3.59 0.00 3.17 0.91 34.30 9.90 Total 239.70 12.29 0.00 6.63 1.88 55.38 18.62 Source: Ministry of Commerce, India 28 Apparel Online India | MARCH 1-15, 2019 | www.apparelresources.com Despite having issues of conversing in English, China is number one in apparel export. Still the industry feels that language is a barrier, although countries like Cambodia have started using English. More or less Sri Lanka, Vietnam, Ethiopia have similar conditions, but Myanmar is still a hurdle.

Apparel Online India Magazine March 1st Issue 2019 | Page 28