China Hurts Developing World Apparel Makers More Than Recession

Feb. 12, 2010 - PRLog -- The $350 bn world trade in garments entered a new phase in 2009, says a report from leading apparel industry researchers Clothesource.
Thousands of struggling businesses and millions of newly redundant workers in some of the world’s poorest countries blamed the Western recession for falling sales. But 60% of sales losses in developing countries overall were the result of the growing competitiveness of China and Vietnam after European and US barriers against them were finally withdrawn at the beginning of 2009.
Those two Asian countries gained substantial share of the worldwide market after European and US barriers against them were finally withdrawn at the beginning of 2009. Though the market overall fell, developing countries on average can blame only 40% of their lost sales on that fall: newly-unrestricted Vietnam and China brutally exposed their competitors’ little-appreciated vulnerability to competition once the comfort blanket of Western trade barriers was lifted.
“Far too many garment makers, and their governments, blame the recession” said Clothesource CEO Mike Flanagan. “The real problem is that, back in 2005, when most quotas against developing-country garment makers were lifted, many forgot just how shackled China and Vietnam still were. People thought we’d moved into the post-quota world and that was that. But at the beginning of 2009, Western markets hit their recession at just the same time China and Vietnam lost their shackles and we’ve moved into a post-post-quota world. Too many garment makers think we’ll go back to the old world as soon as Western demand lifts. We won’t”
In its new report, The Clothesource Guide to the World of Apparel Sourcing 2010-2012, the Oxford, England-based consultancy outlines the Twelve New Laws of Apparel Sourcing “the basic DNA”, says Flanagan, “for the industry’s development in the post-post-quota world”
“China and the recession are just part of the story” Flanagan adds. “The world’s changed in lots of ways.  The Clothesource Guide to the World of Apparel Sourcing 2010-2012 doesn’t just lay out the 12 New Laws: it predicts, for each of the 70-odd leading garment exporting countries, who’ll be gaining and by how much from now to 2012
“The report’s essential not just for buyers and sellers – but for governments and anyone else who wants to understand what has to be done to keep the hundreds of millions of developing-industry garment workers in secure employment.

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Clothesource Limited, based in Charlbury, Oxford, UK and Bucharest, Romania, provides the world’s leading apparel retailers, brands and exporters with quality control and market intelligence on apparel sourcing and exporting