Apparel producers shift focus from US to China

18 Jan '11

2 min read

Garment producers from Philippines, who could not succeed to finalize a trade pact with the United States which could have earned their garments produced from US textiles, a duty-free access in the US markets, are now targeting the Chinese markets.

Executive Director of the Garments and Textile Industry Development Office, Lucita Reyes here said that, the domestic garment producers are now eyeing the high and middle end clothing market of China, owing to their incapability to compete with the apparel producers in the low-end market from countries like Pakistan and Bangladesh who offer goods at very economical rates.

Several Philippine firms have a notable presence in the apparel market of China, particularly in the upcoming south coastal area which has consumers with a more refined taste for fashion.

Though the designs for fabrics are prepared in Philippines, but the production work is carried out in China due to the apparent low cost of labour.

However, in recent times several Filipino garment producers based in China are relocating their production base to home country, particularly in the export processing zones, owing to the rising cost of labour in China.

Reyes revealed that, presently though few of the Filipino firms export garments to China markets, but then there is a vast market there which is still untapped.

The apparel producers in Philippines would no doubt reap the benefits once the ASEAN-China free trade pact becomes effective, but they could gain more from the implementation of a preferential tariff system just like the one they are seeking with the US.

The official said that, more investments may flow to the country if they can tap the China market, as since last two years China has been inducing small and medium scale firms to invest outside the country.

But then the local garment manufacturers would be required to acquire in depth knowledge of the distribution system in China, as a number of suppliers from different tiers comes in between the exporters and consumers, she added.

Even today US stand to be the largest consumer of Filipino apparel, constituting around 81 percent of its overall exports, each year. However, Philippines hardly claim 1.8 percent of the US's total apparel imports.

Fibre2fashion News Desk - India

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