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COTTON-RELATED
Name
Cotton exporter’s guide and
Promoting West-African cotton to Asia
Objectives
The first and
major objective of this project is to provide to African
cotton growers and traders a practical and down-to-earth
guidebook on how to find new business partners on world
markets. The “Cotton Exporter’s Guide” will be a reference
guide for cotton exporters, and especially smallholders and
traders, on how to export cotton to the world. It will
address practical trade-related concerns of cotton-producing
SMEs. A major part of the guide will focus on new cotton
markets in Asia and how best to penetrate them. Moreover,
the Cotton Exporter's Guide will be also be developed as an
on-line Guide in 2009.The second objective of this project
is to assist selected African cotton growers and traders to
find new markets in Asia and particularly in China.
Activities and outcomes
The Cotton Exporter’s Guide was printed in English French and
Spanish. It was successfully used as supporting material for the
EU-ACP All Commodities Programme Kick-off workshops. One result
of these workshops was the strong request from African countries
to use the guide as the major reference material for the
development of a cotton school in Africa. This idea was welcomed
and approved, in principle, by the International Cotton Advisory
Committee. Discussions are on-going with the EC for developing
such a school within the larger context of "Université du Coton).
The Cotton Exporter’s Guide will be made available on-line in
all three languages (English, French and Spanish) by the end of
2009.
South-South Cooperation activities were undertaken in Turkey for
one week in October 2008. 14 participants from 6 African
countries learned from Turkey on a) cotton production, including
seed development, planting, harvesting and ginning; b) fibre
transformation and how to develop a textile and clothing
industry; c) sourcing of cotton inputs from Turkey. Moreover,
they experienced Turkey as an important cotton market and
established first hand contacts with the market (follow-up is
ongoing). Finally, a closer network among the participating
African countries was established.
The Africa Cotton Association recommended the repetition of this
programme in 2009 with other African countries.
A cotton trade promotion and TCDC approach was developed and
implemented to improve African cotton for exports to Asia and
utilized under additional funding. South-south cooperation
activities were implemented under the AAACP, including in
countries such as Bangladesh and China (for East and Southern
Africa) as well as Thailand and Turkey in 2009.
In addition, new opportunities for promoting south-south
cooperation and promotion of African cotton were identified in
India, Brazil as well as Vietnam and Indonesia/Thailand. The
latter will be further developed with the ASEAN Federation of
Textile Industries (AFTEX).
The International Cotton School of the University of Memphis and
the American Cotton Shippers Association uses the Cotton
Exporter’s Guide as its official textbook for its annually
9-week training curse on cotton and cotton trade. The fact that
the most advanced cotton school in the world and the American
cotton farmers and traders use this guide is a clear indication
of its high quality and standard.
Name
Cotton Sector Strategy Implementation
Objectives
Implementation of product and market development
activities of cotton strategies developed together with COMESA (incl. EAC and SADC) as well as UEOMA and CEMAC
Activities
ITC will support cotton associations to identify and
evaluate specific markets (e.g. in Asia), build capacity
through training and counseling of country counterparts to
support African countries to understand and apply quality
requirements and address other supply impediments e.g.
reduction in contamination, improved cotton consistency and
delivery.
ITC can also support training and counseling of counterparts
in marketing for selected importing countries such as Asian
and other emerging markets. In addition, and subject to
confirmation at stakeholder consultations and briefing
meetings, training by textiles production buyers is foreseen
for developing country producers with emphasis on markets,
logistics, quality and preparation for enterprise
matchmaking activities.
A 6-day cotton market familiarisation and marketing
programme was successfully implemented in Bangladesh from 29
January to 5 February 2009, which is the world third largest
cotton importer. The programme was jointly organised with
the Ministry of Textiles, Bangladesh Textile Mills
Association, and the Bangladesh Cotton Association. The
meeting attracted lots of interest in the media and the
Bangladesh textile industry.
21 African participants i) had direct business negotiations
with more than 10 local cotton merchants and an equal number
of cotton-importing spinning mills; ii) understood and
learned the specific requirements of the Bangladeshi cotton
market, received insider information that international
merchants would never share, including all tricks and issues
that need to be addressed to successfully penetrate the
market – special attention was given to issue of extraneous
contamination of cotton and its effect on textile production
and trade; iii) witnessed the development of the entire
textiles and clothing industry through factory visits and
got a firm understanding on how Bangladesh was able to
develop the flourishing industry so successfully.
While ITC sponsored 14 African participants (representing
the farm, ginning and public sector), 7 Tanzanian ginners
and bankers joined the mission on their own full cost. This
is an indication of the importance and usefulness of such
missions.
A 5-day cotton market familiarisation and marketing
programme was successfully implemented in Thailand from 18 –
26 June 2009, which is the world fifth largest cotton
importer. The programme was jointly organised with the
Federation of Thai Industries and the Thai Textile
Manufacturers Association. The Department of Export
Promotion, Ministry of Commerce was also involved in
organising interested Thai companies. The meeting attracted
lots of interest in the industry and was officially opened
by the Vice Minister, Ministry of Commerce. 24 African
participants i) had direct business negotiations with more
than 15 local cotton merchants and an cotton-importing
spinning mills; ii) understood and learned the specific
requirements of the Thai cotton market, received insider
information that international merchants would never share,
special attention was given to issue of extraneous
contamination of cotton and its effect on textile production
and trade; iii) witnessed the development of the entire
textiles and clothing industry through factory visits and
got a firm understanding on how Thailand was able to develop
a flourishing T&C industry.
A 10-day cotton value chain training and marketing of east
African cotton to China programme was successfully
implemented in China from 15 – 25 September 2009, which is
the world largest cotton producer, consumer, transformer and
importer. The programme was jointly organised with the
Ministry of Commerce (MOFCOM), the China National Textiles
and Apparel Council (CNTAC - the former Ministry of
Textiles) and the China Cotton Association (CCA). 31 African
participants (5 out of which financed their complete
participation) went through an intensive training on all
aspects on the cotton to textiles value chain, including
cotton research, seed development, production, harvest,
ginning and s well as spinning and weaving operations. An
intensive training in Beijing followed field visits in
Zhengzhou. The event culminated in a business networking
(buyers-sellers meeting) that brought Chinese cotton traders
and spinning mills together with African cotton fibre
exporters. Moreover, African participated had the
opportunity to interact with Chinese farm-input suppliers,
ginning and textile technology manufacturers as well as the
Zhengzhou Commodity (incl. Cotton) Exchange and cotton and
textile research institutions. Participants had direct
business negotiations with 50 cotton merchants and
cotton-importing spinning mills; ii) understood and learned
the specific requirements of the Chinese cotton market,
received insider information that international merchants
would never share; iii) witnessed the development of the
entire textiles and clothing industry through factory visits
and got a firm understanding on how China is managing its
cotton as well as textiles and clothing growth.
10-day will be implemented in from 27 September to 4 October
2009. The programme is jointly organized with the Aegean Raw
Material Exporters association. 25 participants from the
farm, cotton companies as well inter-professional
organizations will go through an intensive training on all
aspects on the cotton to textiles value chain, including
cotton research, seed development, production, harvest,
ginning and s well as spinning and weaving operations. The
event will culminate in a business networking event between
Turkish cotton merchants and African cotton companies.
An extensive 7-day programme on cotton value chain training
and marketing of West and Central African cotton to Turkey
was successfully implemented in Turkey, which is the world
7th largest cotton producer and the 4th largest cotton
importer. While Turkey produces around 400,000 tons of
cotton its requirements are around 1 million ton p.a.
The programme was jointly organised with the Aegean
Exporters Association, the Denizli T&C Exporters Association
as well as the Mediterranean Exporters Association. 19
African participants went through an intensive training on
all aspects of the cotton to textiles value chain, including
cotton research, seed development, production, harvest (hand
and machine picking), ginning as well as spinning, weaving,
knitting and garment operations. A one day conference in
Izmir followed field visits in Izmir, Menemen, Ayden,
Denizli, Adana, Mersin and Antakya. The event also included
a visit to the Izmir Mercantile Exchange and a business
networking (buyers-sellers meeting) that brought Turkish
cotton traders and spinning mills together with African
cotton companies. Participants had direct business
negotiations with cotton merchants and cotton-importing
spinning mills. Moreover, African participants interacted
with Turkish farm-input suppliers as well as cotton research
institutions.
African cotton producers and ginners understood the specific
requirements of the Turkish cotton market. Three main
lessons are to be retained, i.e. the import market is
dominated by US cotton; b) African cotton has a bad image
including on contamination, stickiness (sugar content) and
unreliable supply in terms of punctuality and fasts delivery
as well as c) African suppliers need to ensure continuity of
supply throughout the year. Participants received insider
information and got a firm understanding on how Turkey is
managing its cotton as well as textiles and clothing growth.
Achievements & Results so far:
Due to ITC’s facilitation a Tanzanian cotton ginners sold
800 tons of lint to a Thai spinning factory between December
2008 and May 2009. This is the first-ever direct sale from
Tanzania to Thailand without the involvement and
international cotton merchant. 800 tons equal to around 4420
bales, which were sold at a market price between 51-54 US
cents/lbs i.e. at around US$ 920,000. We have seen the bales
in the warehouse of the spinning mills. A vendor analysis
made by the spinning mills evaluated the supplier as above
average, even though the contamination level was found too
high. The spinning mill is now engaging to directly work
with the ginner to tackle this problem and will send staff
from Thailand to Tanzania in autumn this year. This shows
that it is possible to directly link cotton producers with
consumers without engaging international merchants. However,
this example remains an exception until cotton suppliers
fully understand international trading and its service
dimension.
Due to ITC’s endeavour to link cotton ginners directly to
international markets, Tanzania is now actively selling its
cotton at increasing prices. Before going on the marketing
mission to Bangladesh, cotton merchants were not buying
cotton from Tanzanian ginners. About 40% of crop or 200,000
bales of cotton were unsold. However, with the notice that
Tanzanian ginners were engaging in directly contacting the
Bangladeshi market, one international merchants immediately
bought 100,000 bales. Moreover, international merchants were
actively contacting Bangladeshi spinners and merchants to
“warn” them of alleged unreliability African suppliers. The
Bangladeshi side, however, is keen to explore more direct
interactions and is, by and large, ignoring the calls from
international merchants. This is another indication of the
usefulness of such kind of market awareness and penetration
activities.
As a result, On 26 September a first ever direct shipment
from Tanzania to Bangladesh of a first order of 1000 bales
(1 bale @ 200 kg) will be shipped. This is a direct result
of the event organised in Bangladesh in February 2009. In
fact, several Tanzanian ginning companies had follow-up
visits to Dhaka, supported by the local CRDB bank. As a
result this first shipment was negotiated and the deal
completed. After a first-ever direct shipment to Thailand,
this is the second example that direct sales of a commodity
such as cotton is possible if a close collaboration of
important value chain players at national level is secured.
The concept of sub-regional cotton cooperation between
Mozambique, Zambia, Zimbabwe and Malawi (MoZaZiMa) was
developed by the various cotton stakeholders of the
countries concerned. As the 4 countries face similar
challenges, need to follow similar practices and have small
cotton crops for marketing purposes, a closer collaboration
was agreed upon. It will be further expanded in 2010 and
2011.
KYRGYZ REPUBLIC
Name
Trade Promotion in the Kyrgyz Republic
Objectives
The overall objective of this project is to contribute to
the sustainable expansion and diversification of SMEs’
exports in Kyrgyzstan through increasing the competitiveness
of the textile and clothing (“T&C”) industry and improving
the quality management infrastructure of the country.
The project builds on the results of two ITC recent needs
assessment and programming missions, the previous ITC
project in Kyrgyzstan and the recommendations of their
independent evaluation (conducted in 2008).
Consistent with its overall objective, the project will
focus on the following four immediate objectives:
1. To support the T&C stakeholders in taking a
strategic approach to the sector’s development
Under this objective, the project will support national
efforts to formulate an export strategy for T&C thus
ensuring a strategic approach to the sector’s development.
2. To enable enterprises, the Government, and
sector-related institutions to better understand T&C
regional and world market requirements, opportunities and
challenges
The project will enhance the enterprises’ and the service
providers’ knowledge and understanding of the markets, as a
key step towards decision-making on individual business and
sector export strategies.
3. To improve the capacities of T&C enterprises and
sector-related service providers in product development and
marketing
This objective will ensure that the knowledge obtained in
the preceding component is applied in practice. The
enterprises, in cooperation with the service providers, will
be assisted in penetrating the markets previously
identified, through improved market planning, structured
participation in trade fairs and buyers-sellers events,
systematic promotion, and demand driven product development.
4. To improve the capacity of SQAM and SPS bodies and
the regulatory infrastructure
The project will complement ITC’s earlier assistance in
improving the quality management infrastructure of the
country with further inputs for e.g. assistance to the
Kyrgyz Accreditation Centre to become a member of the
International Laboratory Accreditation Cooperation (ILAC)
and the establishment of a National Notification Authority
and a National Inquiry Point for SPS.
The different components of this project reinforce each
other, creating synergies and maximizing the impact of the
various activities. The participatory approach will continue
to promote the development of alliances and partnerships
between different stakeholders and other trade related
technical cooperation providers. Given the demand driven
approach of the project, some of the project components may
be adjusted to fit the evolving needs and requirements of
the country, in consultation with project partners. A
Project Steering Committee (PSC) will be established
comprising SECO, ITC and representatives from the relevant
Ministries to ensure regular coordination and monitoring of
the project implementation.
TAJIKISTAN
Name
Trade Promotion in Tajikistan
Objectives
The overall objective of this project is to contribute to
the sustainable expansion and diversification of SMEs’
exports in Tajikistan through increasing the competitiveness
of the textile (mainly yarn) and clothing (“T&C”) industry
in Tajikistan and improving the quality management
infrastructure of the country. The project builds on the
results of two ITC recent needs assessment and programming
missions, the previous ITC project in Tajikistan and the
recommendations of their independent evaluation (conducted
in 2008). Consistent with its overall objective, the project
will focus on the following four immediate objectives:
1. To support the T&C stakeholders in taking a
strategic approach to the sector’s development
Under this objective, the project will support national
efforts to formulate an export strategy for T&C thus
ensuring a strategic approach to the sector’s development.
2. To enable enterprises, the Government, and
sector-related institutions to better understand T&C
regional and world market requirements, opportunities and
challenges
The project will enhance the enterprises’ and the service
providers’ knowledge and understanding of the markets, as a
key step towards decision-making on individual business and
sector export strategies.
3. To improve the capacities of T&C enterprises and
sector-related service providers in product development and
marketing
This objective will ensure that the knowledge obtained in
the preceding component is applied in practice. The
enterprises, in cooperation with the service providers, will
be assisted in penetrating the markets previously
identified, through improved market planning, structured
participation in trade fairs and buyers-sellers events,
systematic promotion, and demand driven product development.
4. To improve the capacity of SQAM, SPS and TBT bodies
and the regulatory infrastructure
The project will complement ITC’s earlier assistance in
improving the quality management infrastructure of the
country with further inputs for e.g. laboratory
accreditation and the establishment of a National
Notification Authority and National Inquiry Points for TBT
and SPS.
The different components of this project reinforce each
other, creating synergies and maximizing the impact of the
various activities. The participatory approach will continue
to promote the development of alliances and partnerships
between different stakeholders and other trade related
technical cooperation providers. Given the demand driven
approach of the project, some of the project components may
be adjusted to fit the evolving needs and requirements of
the country, in consultation with project partners. A
Project Steering Committee (PSC) will be established
comprising SECO, ITC and representatives from the relevant
Ministries to ensure regular coordination and monitoring of
the project implementation.
The project will start with a pilot phase, followed by three
successive implementation phases. The launch and financing
of each implementation phase will be subject to the
accomplishment of the targets of the preceding phase. The
PSC will update the planning and objectives of each phase
before its launch and review its implementation.
COTTON-RELATED
Name
Cotton exporter’s guide and
Promoting West-African cotton to Asia
Objective
Provide to African cotton
growers and traders a practical and down-to-earth guidebook on how to
find new business partners on world markets. Assist selected
West-African cotton growers and traders to find new markets in Asia
and particularly in China.
Background
Thirty-three African
countries (out of a total of fifty-three) are producers and net
exporters of cotton. In these countries, cotton plays an essential
role in economic and social development, contributing to poverty
reduction. Africa represents 14% of world cotton area and 18% of world
exports for this product. Over the last 2 decades, worldwide cotton
consumption has accelerated. After growing only 0.3 percent per year
during the 1990s, cotton consumption increased by 3% annually during
2000-2004. Production is falling behind mill use in China, Pakistan,
India and Turkey. These 4 countries alone accounted for 15% of world
imports in 2000/01 and are expected to reach 49% in 2005/06.
Activities
●
Publish The Cotton Exporter’s Guide.
●
Identify quantitative and qualitative cotton demand of China (Asia)
from the participating countries.
●
Develop African cotton producers and exporters knowledge of export
procedures as well as Chinese (Asian) import requirements,
distribution channels and the Chinese (Asian) cotton market.
●
Develop and implement a cotton trade promotion and TCDC approach to
improve African cotton for exports to China (Asia).
EMERGING MARKETS
Name
Assisting LDC clothing
exporters to penetrate emerging markets
Objective
Stimulate trade between
least developed countries and emerging markets.
Background
Developing countries need
to continue penetrating traditional QUAD markets, but must
increasingly begin to exploit markets in other developing countries.
Whilst the traditional QUAD markets, which still account for almost
80% of world imports, are expected to grow only marginally in the
future, the markets of larger developing countries are growing very
fast. India, China, Malaysia, Singapore, Brazil or South Africa are
large markets with enormous potential for growth – and thus enormous
potential as markets for exports. Developing countries’ imports of
clothing have grown faster (at 6.5% p.a.) over the last decade than
those of developed countries (4.7%).
Achievements
●
Analyse the T&C market in selected DCs and assess the possibility of
exports to these DCs from LDCs.
●
Analyse possible complementarities in the T&C value chain of DCs and
LDCs.
●
Develop approaches to exploit trade in intermediaries with the final
goal of serving traditional markets in the North as foreseen under
preferential agreements.
●
Identify TCDC schemes of DCs, which could be directed towards
assisting LDCs in accessing DC T&C markets.
LAO PDR
Name
Supporting the shift of the
garment industry from contract manufacturing to direct export in Lao
PDR
Objective
This project aims to
support the Lao Garment Industry to operate smoothly its shift from
contract manufacturing to direct export (CMT (Cut, Make and Trim) to
FOB (Free On Board) contractual selling agreements).
Background
Lao’s garment industry has
a rather short history compared to other established garment
manufacturing countries. It is a landlocked country with limited
backward linkages to fabrics and accessories. Lao owned companies work
either with cut-make orders provided by Bangkok, Hong Kong or other
buyers agents or produce as sub-contractors with overflow orders from
other garment manufacturers in Lao. The companies usually work on a
Cut-Make-Trims (CMT) basis, or CM which has contributed to garment
industry only 35%, although some would like to work on a FOB basis, if
they had access to sufficient working capital. These companies are
vulnerable, as they are dependent on work being provided by third
parties, and have very limited control over their own destinies.
Activities
●
Training on export, skills enhancement and strengthen capacity of Lao
owned Garment companies to shift from CMT to FOB selling arrangements
made sustainable for selected companies
●
Enhance the capacity of the Association of the Lao Garment Industry (ALGI)
to support its members in export development and promotion
MAURITIUS
Name
Improving Competitiveness
of the Clothing Industry in Mauritius
Objective
Assist Mauritius to retain
trade in Textiles & Clothing (T&C) as a means for economic development
and thus poverty reduction through employment creation.
Background
Mauritius’s preferential
access to the EU and US markets has been influential in the relative
success of the Export Processing Zone (EPZ) in the T&C industry.
However, since the erosion of these market access privileges, the T&C
sector went from largest employer and foreign exchange earner over the
past decades to become a less than 7% contributor to GDP in 2006.
Mauritius is one of the rare countries which depends heavily both on
sugar and textile. As shown by the data in the quota free era,
Mauritius has been one of the worse hit countries in terms of loss of
market share in its traditional T&C markets. In order to maintain a
GDP growth sufficient to curb unemployment, the existing sectors must
be saved, sustained and reengineered. T&C is of prime importance to
Mauritius as it is the manufacturing activity in which the country has
the most experience and which can sustain employment at different
levels.
Activities
●
Product diversification
● Identification of new markets
●
Improve performance of clothing manufacturers in fabric and accessory
sourcing
●
Increase national capacity to provide sourcing training
ROMANIA
Name
Sustainable Export
Development in Romania
Objective
Contribute to Romania’s
overall economic and human development through improving international
competitiveness of Romanian export-oriented companies.
Background
The contribution of the
light industries (textiles, clothing and leather) to the Romanian
economy is substantial. In 2004, the sector was accountable for 5.5%
of GDP, 9.9% of the country’s industrial production volume, and 34% of
exports. The export value reached $ 6070 million in this year
(compared to $ 2913 million in 1999). The sector’s production
structure was: 62.5% garments, 22.3% textiles, and 15.2% leather. Over
7200 companies operate in the sector, employing over 450,000 workers,
(20.4% of the employed labour force in Romania). Private enterprises
in the sector are responsible for 97% of production and exports. In
spite of its contribution to the economy, value addition in the sector
is generally low. It utilizes a great deal of imported raw material
and low-wages work force. Most companies work under the “Lohn” or CMT
system (cut, make, trim), by which the Romanian companies supply
labour and machinery and the customer raw material, designs and
marketing.
Activities
●
Creating a link between student activities of the Cluj School of Art
and Design and selected garment manufacturing companies so as to bring
in an industry perspective to the curriculum.
●
Establishing a forum for dialogue between Industry, the Technical
University of Iasi (Dept of Textiles & Leather), the Ministry of SMEs,
Trade, Tourism and Liberal Professions, and Fepauis.
●
Enabling selected companies to participate in trade fairs, by
improving skills in product design, development and marketing.
COTTON-RELATED
Name
Cotton exporter’s guide and
Promoting West-African cotton to Asia
Objective
Provide to African cotton
growers and traders a practical and down-to-earth guidebook on how to
find new business partners on world markets. Assist selected
West-African cotton growers and traders to find new markets in Asia
and particularly in China.
Background
Thirty-three African
countries (out of a total of fifty-three) are producers and net
exporters of cotton. In these countries, cotton plays an essential
role in economic and social development, contributing to poverty
reduction. Africa represents 14% of world cotton area and 18% of world
exports for this product. Over the last 2 decades, worldwide cotton
consumption has accelerated. After growing only 0.3 percent per year
during the 1990s, cotton consumption increased by 3% annually during
2000-2004. Production is falling behind mill use in China, Pakistan,
India and Turkey. These 4 countries alone accounted for 15% of world
imports in 2000/01 and are expected to reach 49% in 2005/06.
Achievements
2007 – The Cotton
Exporter’s Guide was finalized and an advance copy introduced to the
cotton world during the annual meeting of the International Cotton
Advisory Committee in Izmir, Turkey in October 2007. The feedback from
all parts of the cotton community was very positive and discussions
were initialized to establish a “moving” cotton school based on the
Guide. In addition, a technical paper “Organic Cotton: An Opportunity
for Trade” was elaborated and presented to the cotton community during
the China International Cotton Conference. Moreover, four South–south
cooperation activities were carried out to create market transparency
and to expose African cotton producers and exporters to Know How,
technologies and market opportunities in Asia. These were implemented
in India, China, Republic of Korea and Turkey. African exporters form
the East and West Africa learned farming, breeding and production
technologies in India and China and how to adapt it to the African
situation. Furthermore, the entire value chain of cotton
transformation was addressed and exporters gained a clear insight into
how to transform cotton in China, India, Republic of Korea and Turkey.
Finally, in all four markets African cotton exporters met cotton
importers and users (spinning mills), gaining a full understanding on
how to promote their cotton and how to conclude export orders with
these markets.
CENTRAL AMERICA REGION
Name
Development of a
large-scale project for competitiveness enhancement of the clothing
sector in Central America
Objective
Assist the industry in the
region (selected enterprises through their respective associations) in
increasing competitiveness and in creating capacity to withstand
increasing competition. This will be done through targeted assistance
and by utilizing inter-regional trade development opportunities to a
maximum extent.
Background
Clothing manufacturers in
Central America face serious challenges in the post-quota era, which,
to a major some extend, are a result of the protection the industry
benefited from. All countries are heavily dependent on their exports
to the USA. While the reason for this is found in the close geographic
proximity to the US and the trade preferences granted by the latter,
it is also a danger in case of major sourcing changes taking place in
the market.
Achievements
2007 – The project document was
finalized and verified after further discussion with the industry
during the Apparel Sourcing Show in Guatemala City in May 2007. The
document was approved by all five T&C associations in the region. The
overall approach was presented during the conference of the Apparel
Sourcing Show for verification of a wider audience. The approach was
regarded as very relevant, timely and result-oriented to tackle a
major problem of the industry in Central America.
EMERGING MARKETS
Name
Assisting LDC clothing
exporters to penetrate emerging markets
Objective
Stimulate trade between
least developed countries and emerging markets.
Background
Developing countries need
to continue penetrating traditional QUAD markets, but must
increasingly begin to exploit markets in other developing countries.
Whilst the traditional QUAD markets, which still account for almost
80% of world imports, are expected to grow only marginally in the
future, the markets of larger developing countries are growing very
fast. India, China, Malaysia, Singapore, Brazil or South Africa are
large markets with enormous potential for growth – and thus enormous
potential as markets for exports. Developing countries’ imports of
clothing have grown faster (at 6.5% p.a.) over the last decade than
those of developed countries (4.7%).
Achievements
2007 – A technical paper
grouping all individual country studies was edited. It will be printed
in 2008. Content was already disseminated to various LDCs. Results
were also utilized in other ITC projects targeting newly emerging
markets, e.g. in Sri Lanka and Mauritius the Indian market was
successfully penetrated for the first time with new export orders.
INDIA
Name
Training in Key Competitive
Factors in 5 Indian Apparel producing Clusters
Objective
Create in T&C producing
companies of Delhi, Jaipur, Mumbai, Bangalore and Tirupur the
necessary awareness, understanding and skills of the importance of
adopting a value chain perspective in all business operations related
to exports.
Background
SMEs in India are mainly
family run businesses that started exporting under the quota system.
Under that system, they benefited from protected markets and needed to
focus anly at the manufacturing part, as all other “services” were
organised by agents and the buyer. With the quota removal this is
changing. Clothing manufacturers must provide a range of services to
their buyers, including in the areas of marketing, sourcing, logistics
and e-services, along the clothing value chain.
Achievements
2007 – Trained up to 75
companies per cluster in the areas of value-chain approach, sourcing,
e-applications in T&C and marketing. Created three training courses on
product design and development related issues as well as using
e-applications for garment manufacturers, that will be used on a
sustainable basis by AEPC members as a result of the proactive
involvement and programme support from the National Institute of
Fashion Technology (NIFT), New Delhi. Built capacity within AEPC to
become a full service provider to their members, approximately 6000
garment manufacturers all over India. After the quota phase-out AEPC
decided to shift focus from quota administration towards assisting
their members in increasing competitiveness. This project helped to
shape this focus and has enabled AEPC to successfully offer such
solutions.
LAO PDR
Name
Supporting the shift of the
garment industry from contract manufacturing to direct export in Lao
PDR
Objective
This project aims to
support the Lao Garment Industry to operate smoothly its shift from
contract manufacturing to direct export (CMT (Cut, Make and Trim) to
FOB (Free On Board) contractual selling agreements).
Background
Lao’s garment industry has
a rather short history compared to other established garment
manufacturing countries. It is a landlocked country with limited
backward linkages to fabrics and accessories. Lao owned companies work
either with cut-make orders provided by Bangkok, Hong Kong or other
buyers agents or produce as sub-contractors with overflow orders from
other garment manufacturers in Lao. The companies usually work on a
Cut-Make-Trims (CMT) basis, or CM which is contributed to garment
industry only 35%., although some would like to work on a FOB basis,
if they had access to sufficient working capital. These companies are
vulnerable, as they are dependent on work being provided by third
parties, and have very limited control over their own destinies.
Achievements
2007 – The project was
launched and resource persons met from the Association of Lao Garment
Industry, Department of Production and Trade Promotion, Ministry of
Industry and Commerce.
MAURITIUS
Name
Improving Competitiveness
of the Clothing Industry in Mauritius
Objective
Assist Mauritius to retain
trade in Textile & Clothing (T&C) as a means for economic development
and thus poverty reduction through employment creation.
Background
Mauritius’s preferential
access to the EU and US markets has been influential in the relative
success of the Export Processing Zone (EPZ) in the T&C industry.
However, since the erosion of these market access privileges, the T&C
sector went from largest employer and foreign exchange earner over the
past decades to become a less than 7% contributor to GDP in 2006.
Mauritius is one of the rare countries which depends heavily both on
sugar and textile. As shown by the data in the quota free era,
Mauritius has been one of the worse hit countries in terms of loss of
market share in its traditional T&C markets. In order to maintain a
GDP growth sufficient to curb unemployment, the existing sectors must
be saved, sustained and reengineered. T&C is of prime importance to
Mauritius as it is the manufacturing activity in which the country has
the most experience and which can sustain employment at different
levels.
Achievements
2007 – Upto the end of
2007, the project has succeeded in training and preparing
approximately 15 companies to access the French market, to participate
in the FATEX trade fair at their own cost with help from Enterprise
Mauritius and to make a place for themselves in a highly competitive
global apparel supply market. The coordination and project management
at the national level between EM and the participating companies
helped initiate the interest of at least 15 buyers per company that
participated in the two missions to France. 10 to 15 buyers showed
serious interest and placed a request for sample developments at the
FATEX exhibition in Paris in November 2007. This was the first time
that the companies realised their potential and have since started
liaising with the buyers themselves. UK and Scandinavian market
activities will start in 2008. The sourcing component also starts in
2008.
ROMANIA
Name
Sustainable Export
Development in Romania
Objective
Contribute to Romania’s
overall economic and human development through improving international
competitiveness of Romanian export-oriented companies.
Background
The contribution of the
light industries (textiles, clothing and leather) to the Romanian
economy is substantial. In 2004, the sector was accountable for 5.5%
of GDP, 9.9% of the country’s industrial production volume, and 34% of
exports. The export value reached $ 6070 million in this year
(compared to $ 2913 million in 1999). The sector’s production
structure was: 62.5% garments, 22.3% textiles, and 15.2% leather. Over
7200 companies operate in the sector, employing over 450,000 workers,
(20.4% of the employed labour force in Romania). Private enterprises
in the sector are responsible for 97% of production and exports. In
spite of its contribution to the economy, value addition in the sector
is generally low. It utilizes a great deal of imported raw material
and low-wages work force. Most companies work under the “Lohn” or CMT
system (cut, make, trim), by which the Romanian companies supply
labour and machinery and the customer raw material, designs and
marketing.
Achievements
2007 - All the planned
generic training activities have been completed. The sector-specific
activities have started for the wooden furniture, garments and organic
agriculture sectors and are presently being adjusted according to
evolving demand, which is verified through expert assessment missions
to Romania and close and systematic consultations with the Romanian
project partners.2006The 1st mission to Romania under the module
"National Export Strategy" took place on 14-16 November. On the 14
November, ITC’s expert conducted a one-day training workshop in
Bucharest for representatives of implementing agencies on the
management and impact assessment of the strategy implementation. On
the 15 November a one-day awareness event was held in Ploiesti for
decision-makers from the public and the private sectors from the
Muntenia region, with the view to solicit the commitment and the
active participation of all stakeholders in the regional export
strategy initiative and to provide initial training on the strategy
methodology.
SRI LANKA
Name
An integrated clothing project in Sri Lanka
Objective
Selected clothing manufacturers were enabled to take over
value chain responsibilities to attract new, demanding
buyers and to develop new exports. This was achieved by
supporting enterprises in marketing (including design and
product development) and sourcing of fabrics and accessories
in South Asia and ASEAN countries. The following sequence of
activities was pursued:
-
Understanding
the value chain, and the importance of sourcing for the
marketing of products.
-
Understanding
the target market; collection and sample development.
-
Sourcing the
right fabrics for the target market.
-
Sourcing
mission to Asia to identify and negotiate with the right
fabric mills.
-
Finalizing
the collection, and sample development for the target
market.
-
Introducing
the new collections to the market during a first
marketing mission.
-
Conducting a
second round of activities, including a follow-up
marketing mission.
Activities & Implementation
Target markets for the marketing component were France,
Germany and India. Material sourcing activities targeted
India and Indonesia.
The programme was implemented together with the Joint
Apparel Association Forum (JAAF) of Sri Lanka. Colombo-based
training was open to all interested enterprises, while
specific targeted assistance with regard to target markets
and fabric sourcing was available to a selected number of
5-10 companies per market.
Target enterprises were clothing manufacturers with the
capability and vision to become market champions. Selected
companies were a certain size (200-1,000 machines), showed
their high level of commitment by self-financing their
participation, and were able to change to new products and
smaller production runs in target markets.
Outcome and results
Participating companies obtained orders worth more than US$
6 million from new customers in France, Germany and India.
The project explored the India-Sri Lanka Free Trade
Agreement, which has never been used to export garments
duty-free to India. Moreover, the regional cumulation
provision under the EU GSP scheme has been utilized by
assisting Sri Lankan companies to source Indian fabrics for
garments to be exported to the EU.
COTTON-RELATED
Name
Cotton exporter’s guide and
Promoting West-African cotton to Asia
Objective
Provide to African cotton
growers and traders a practical and down-to-earth guidebook on how to
find new business partners on world markets.Assist selected
West-African cotton growers and traders to find new markets in Asia
and particularly in China.
Background
Thirty-three African
countries (out of a total of fifty-three) are producers and net
exporters of cotton. In these countries, cotton plays an essential
role in economic and social development, contributing to poverty
reduction. Africa represents 14% of world cotton area and 18% of world
exports for this product.Over the last 2 decades, worldwide cotton
consumption has accelerated. After growing only 0.3 percent per year
during the 1990s, cotton consumption increased by 3% annually during
2000-2004. Production is falling behind mill use in China, Pakistan,
India and Turkey. These 4 countries alone accounted for 15% of world
imports in 2000/01 and are expected to reach 49% in 2005/06.
Achievements
2006 – The development of
the cotton exporters guide was under progress. Most of the text for
the guide was available with contributions from important
international cotton players, including ICAC, universities,
international trading houses, exporters, WTO and others. In November
ITC, together with the South Indian Textiles Research Association,
Ministry of Textiles, with co-finance form the Ministry of External
Affairs, Government of India, held a Cotton Training Programme for 22
participants from four East African countries (namely Ethiopia,
Tanzania, Uganda and Zambia) in Coimbatore. The training encompassed a
series of lectures focusing on cotton production management,
processing and value addition as well as international cotton trade
combined with study visits to cotton fields, research institutes,
spinning and weaving mills and cotton machinery producers.
Participants acquired a sound insight of the Indian cotton sector and
the success factors behind India’s cotton boom. Moreover, they
understood the market requirements to comply with in order to enter
this market. This experience demonstrated that South-South cooperation
is a key area to help African cotton producers address quality
requirements and increase exports. According to the WTO Secretariat,
this was a “welcome opportunity to show how trade could work for
development in the context of the DDA”. Participants commended ITC for
a “pragmatic and result-oriented programme in an area of importance
for Africa” and suggested continuing this kind of support project.
BRAZIL
Name
Delivery of a two-day
training activity aimed at expanding Brazilian exports in textiles and
clothing
Objective
Provide a thrust in the
direction of increasing and expanding exports by leveraging existing
skills in the Brazilian domestic sector.
Background
While Brazil boasts of a
thriving domestic textiles and clothing sector, its share of world
trade in this sector does not even add up to 1%. Although some
textiles manufacturers are exporting, most of their exports are
directed to a few regional countries within Latin America.
Achievements
2006 – Both, the seminar
and workshop was very well received and appreciated by the
participants and partners. Participants, for the first time, were
given an opportunity to express themselves and have a dialogue and
interact with other players. Although not all industry leaders were
present at the workshop, the existing participants were very
interested and congratulated ITC on this initiative. They participated
actively in providing their thoughts and identified bottlenecks across
the value chain and proposed various remedial actions that would help
them to export better. A very important and substantial output of this
training activity was the interest shown by a Brazilian enterprise on
exploring opportunities to source for raw materials from India. Two
women entrepreneurs went to India in December to meet with the Apparel
Export Promotion Council (AEPC) and attend the ITC workshops on
sourcing and product development in early January 2007. They met with
many yarn suppliers and apparel manufacturers in Mumbai, Bangalore,
Tirupur and Delhi during their two-week visit to India. This small,
but significant effort has now opened the doors for further
conversation and possible business between the two countries in the
textiles and clothing sector.
CENTRAL AMERICA REGION
Name
Development of a
large-scale project for competitiveness enhancement of the clothing
sector in Central America
Objective
Assist the industry in the
region (selected enterprises through their respective associations) in
increasing competitiveness and in creating capacity to withstand
increasing competition. This will be done through targeted assistance
and by utilizing inter-regional trade development opportunities to a
maximum extent.
Background
Clothing manufacturers in
Central America face serious challenges in the post-quota era, which,
to a major some extend, are a result of the protection the industry
benefited from. All countries are heavily dependent on their exports
to the USA. While the reason for this is found in the close geographic
proximity to the US and the trade preferences granted by the latter,
it is also a danger in case of major sourcing changes taking place in
the market.
Achievements
2006 – A detailed project document was
elaborated with the inputs and contributions from all 6 Central
American T&C associations. They have approved the project document as
a priority area for them to improve sector competitiveness. In the
process of elaborating the final draft, a joint regional
videoconference was held together with BCIE in their premises in
Tegucigalpa for all 6 countries, including the T&C associations.
Meetings with IaDB (BID) confirmed the importance of the project. A
closer cooperation was not possible as BID was already elaborating a
project in the region with focus on labour issues to improve
productivity. In close cooperation with GTZ a first step towards
forming a regional federation of T&C associations was done and a first
meeting organised in San Salvador on 24 March 2006. All represented
associations signed a declaration of intentions on how to set up the
new federation. A second reunion was organised by the associations
during the Apparel Sourcing Show 16-18 May 2006 in Guatemala City.
EMERGING MARKETS
Name
Assisting LDC clothing
exporters to penetrate emerging markets
Objective
Stimulate trade between
least developed countries and emerging markets.
Background
Developing countries need
to continue penetrating traditional QUAD markets, but must
increasingly begin to exploit markets in other developing countries.
Whilst the traditional QUAD markets, which still account for almost
80% of world imports, are expected to grow only marginally in the
future, the markets of larger developing countries are growing very
fast. India, China, Malaysia, Singapore, Brazil or South Africa are
large markets with enormous potential for growth – and thus enormous
potential as markets for exports. Developing countries’ imports of
clothing have grown faster (at 6.5% p.a.) over the last decade than
those of developed countries (4.7%).
Achievements
2006 – Individual country
studies were initialized and contributors for the markets of Brazil,
China, India, Singapore/Malaysia and South Africa have been identified
and recruited. A finalised table of contents has been elaborated and
discussed with major players, including WTO. The first draft of
chapters from all the experts was received by November 2006. Important
issues such as tariff rates and information on particular retailers
and buying agents in all the countries was shared with the help of
well-illustrated case studies. The second stage of editing of all
chapters was initiated.
INDIA
Name
Training in Key Competitive
Factors in 5 Indian Apparel producing Clusters
Objective
Create in T&C producing
companies of Delhi, Jaipur, Mumbai, Bangalore and Tirupur the
necessary awareness, understanding and skills of the importance of
adopting a value chain perspective in all business operations related
to exports.
Background
SMEs in India are mainly
family run businesses that started exporting under the quota system.
Under that system, they benefited from protected markets and needed to
focus anly at the manufacturing part, as all other “services” were
organised by agents and the buyer. With the quota removal this is
changing. Clothing manufacturers must provide a range of services to
their buyers, including in the areas of marketing, sourcing, logistics
and e-services, along the clothing value chain.
Achievements
2006 – The first set of
1-day workshops, held in the clusters of Mumbai, Tirupur, Bangalore,
Delhi and Jaipur, attracted over 350 participants from across the
country, mainly consisting of large and small apparel manufacturers
and exporters. Representatives from the premier fashion and technology
institutes were also present at all the workshops. The workshops
attracted the attention of many high-level individuals including some
of the leading Indian apparel industry exporters and executives. At
the end of each workshop, participants identified two key topics;
‘product design and development’ and ‘competitive material sourcing’.
An advanced technical workshop of 1-2 days each on these topics will
take place in all the clusters in January and February 2007 during the
second phase of the project. The National Institute of Fashion
Technology (NIFT), New Delhi came forward to provide programme support
in coordination with ITC for the development of training material for
the proposed advanced workshops.
MAURITIUS
Name
Improving Competitiveness
of the Clothing Industry in Mauritius
Objective
Assist Mauritius to retain
trade in Textile & Clothing (T&C) as a means for economic development
and thus poverty reduction through employment creation.
Background
Mauritius’s preferential
access to the EU and US markets has been influential in the relative
success of the Export Processing Zone (EPZ) in the T&C industry.
However, since the erosion of these market access privileges, the T&C
sector went from largest employer and foreign exchange earner over the
past decades to become a less than 7% contributor to GDP in 2006.
Mauritius is one of the rare countries which depends heavily both on
sugar and textile. As shown by the data in the quota free era,
Mauritius has been one of the worse hit countries in terms of loss of
market share in its traditional T&C markets. In order to maintain a
GDP growth sufficient to curb unemployment, the existing sectors must
be saved, sustained and reengineered. T&C is of prime importance to
Mauritius as it is the manufacturing activity in which the country has
the most experience and which can sustain employment at different
levels.
Achievements
2006 – A mission was
undertaken to launch the project with Enterprise Mauritius in October
2006. This project-launching workshop was attended by 50 participants
from 24 enterprises as well as representatives from various Ministries
and related institutions. Enterprises that participated expressed
their firm intention to participate in the integrated project
(training and on-the-job learning in material sourcing, including
exploration of new sourcing markets, as well as product and market
development in three priority sectors for SMEs in the clothing
sector). While the training component of this project is open to all
enterprises, the market-related sourcing activities are open only to
20-30 companies. Interested companies have already started sending in
their applications to Enterprise Mauritius for consideration. The
evaluation of enterprises for participation in the project is
currently being processed. Based on Enterprise Mauritius’ market
research and discussion with prospective participants, three markets
have been currently selected as target export markets. These markets
are: France, UK and Scandinavia. The Sourcing markets have been
finalised as India and South Korea.
CENTRAL AMERICA REGION
Name
Development of a
large-scale project for competitiveness enhancement of the clothing
sector in Central America
Objective
Assist the industry in the
region (selected enterprises through their respective associations) in
increasing competitiveness and in creating capacity to withstand
increasing competition. This will be done through targeted assistance
and by utilizing inter-regional trade development opportunities to a
maximum extent.
Background
Clothing manufacturers in
Central America face serious challenges in the post-quota era, which,
to a major some extend, are a result of the protection the industry
benefited from. All countries are heavily dependent on their exports
to the USA. While the reason for this is found in the close geographic
proximity to the US and the trade preferences granted by the latter,
it is also a danger in case of major sourcing changes taking place in
the market.
Achievements
2005 – A joint
videoconference was organised together with GTZ and BCIE in the
premises of BCIE in Tegucigalpa. All national T&C associations and
several enterprises and development banks benefited from training in
how to exploit CAFTA to develop intra-regional trade and how to
improve the region’s export performance in the T&C sector. A draft
project document was developed, outlining a detailed regional and
complementing national outputs and activities. It was presented to
BCIE and IADB as well as to GTZ. Support on the approach and document
developed was received from the US Association of Importers of
Textiles and Apparel as well as US-TR.
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