Malaysia is one more country in the ASEAN, after Indonesia to be affected by the influx of Chinese textiles and clothing, after the signing of the Free Trade Agreement (FTA) between China and the ASEAN countries, which came in to effect from January 1, 2010.
Local textile and apparel brands are expanding their range of products and also strengthening their retail and distribution networks, in a bid to counter the entry of Chinese textiles and clothing which are also priced very competitively.
Before the FTA came in to effect, Chinese textiles and clothing attracted customs duty averaging between 5-20 percent depending on the variety, but now it attracts zero-duty and are also priced nearly 20-30 percent, below what is offered by the domestic brands.
Since cost of production is on the rise, these brands are outsourcing their requirements to other low-cost countries as according to a clothing brand, it is cheaper to have it manufactured elsewhere, when the sales volumes are still on the lower side.
Fibre2fashion News Desk - India
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