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Foreign labour scarcity upsets Malaysian textile industry
04
Dec '10
With the Trans-Pacific Strategic Economic Partnership (TPP) agreement coming into effect from 2012, the Malaysian Government will be required to relax its domination on the supply of foreign labour, so as to help the country's apparel and textile industry to take advantage of the US market.

US, being the leading importer of the country's apparel and textile products, imported around 35 to 40 percent of the country's overall apparel and textile exports worth RM8.9 billion, last year.

The Malaysian cotton and synthetic man-made fibre right now attract a duty of 17 and 30 percent respectively on their exportation to US market, and therefore the Malaysian authorities are now bargaining with US authorities for the removal or at least reduction of these duties to a bare minimum.

These negotiations are believed to get over in 2012, along with the implementation of the TPP. Removal of these duties would allow the Malaysian apparel and textile exporters to boost their exports not only to the US, but even to other TPP nations.

Chile, Australia, New Zealand, Brunei, Singapore, Peru and Vietnam are all parties to the TPP agreement along with the US and Malaysia.

But then, the issue of foreign labour scarcity confronting the industry would minimize the benefits of the implementation of the TPP agreement. This year too it remained the major factor which restrained exports.

The dearth of foreign workers impeded the textile and apparel manufacturers from accepting the extra orders, this year. Owing to this the sector's exports for current year are expected to remain somewhere around RM8.9 billion, which is more or less similar to last year's figure.

The country exported RM6.5 billion worth of textile and apparel products during the initial nine months of this year.

The country's export of textile and apparel goods to the US declined from RM2.4 billion in 2008 to RM1.8 billion in 2009, largely because of the lack of foreign labour.

Fibre2fashion News Desk - India

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