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Tumultuous phase for textile & clothing industry
30
Jul '08
The Australian textile and clothing sector seems to be going through a very tumultuous phase in recent years. All the statistical figures related to the industry are depicting a negative growth in all aspects.

For instance, total market size for the above mentioned sector in 1997 was Aus $5,910 million, which dropped to $4,502 million in 2002 and slipped to just $2,781 million in 2007, to register a negative growth rate of 7.3, 9.3 and 8.6 percent in the last ten, five and one year respectively.

Employment levels which stood at 88,100 in 1997, went down to 68,600 in 2002, further plummeted to 46,900 in 2006, but managed to gain back lost ground in 2007 at 52,700. Except for the year 2007 when it gained by 12.4 percent, in the rest of the previous ten and five years it recorded de-growth of 5.0 and 5.1 percent respectively.

Exports too have followed the down trend. It was Aus $3,059 million in 1997, further fell to $2,870 million in 2002 and plunged to $1,675 million in 2007. The overall lose was 5.2 percent over 10 years, a whopping 10.2 percent in 5 years and a miniscule 0.3 percent over the last 1 year.

Imports are the only parameter which has bucked the trend. It climbed to Aus $7,764 million in 2002 from $5,644 million in 1997 and further rose to $8,703 million in 2006 and ascended to $8,959 million in 2007. Imports posted growth rates of 4.7, 2.9 percent and 2.9 percent over the preceding 10, 5 and 1 year periods.

Investments in the industry have also dropped abysmally in the last 10 years. From a peak of Aus $267 million in 1997, it went down to $218 million in 2002 and fell to an alarming $146 million in 2007. In the preceding 1 year period investment fell by a shocking 19.3 percent.

Figures of investment in research and development within the industry are more appalling. From just Aus $21 million in 1996-97 it grew to just $22 million in 2001-02 and a respectable $39 million in 2006-07.

The answers are not far to seek for the current state of the textile and clothing industry in Australia. The biggest factor has been the low cost production bases of Asian countries like China, India, Bangladesh and Vietnam which have managed to take away market shares from other global competitors.

Secondly enough investment has not been made in research and development activities which could have offset all the negative factors, by bringing out more and more value added and innovative products.

This has been amply demonstrated by numerous companies in the US and the EU who also have had to face the same pressures as their Australian counterparts, but managed to survive on the strengths of the investments made in research and development activities in the sector.

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Fibre2fashion News Desk - India

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