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World Textiles and Clothing after Quota Elimination: Winners and Losers
published in Issue 114, November-December 2004
The Agreement on Textiles and Clothing (ATC) expired at the end of 2004, marking the end of quotas limiting textile and clothing trade between World Trade Organisation (WTO) members. Large developing countries—notably China, India and Pakistan—were the most restricted by quotas. By implication, these are the likely winners from the quota phase-out, especially China and India. The main losers are likely to be high wage firms in the quota-restricted countries who have enjoyed protection for over 40 years. However, losers will also include small developing countries located far from the major Western markets which benefited from quota-free access to those markets.
Future competitiveness in textiles and clothing will depend on total cost, lead times, design and quality. Low labour costs alone will not be enough to make firms competitive. This is especially true of firms in developing countries where wages represent only a small share of total costs. Equally, producers in higher wage countries have a chance of compensating for their higher wage costs if they have lower nonlabour input costs and offer good design and short lead times.
Norway’s experience may provide a foretaste of what will happen in the EU in 2005 and beyond. The country eliminated its last quotas on January 1, 2001—four years ahead of Canada, the EU, and the USA. Since then, China and Bangladesh have increased their shares of the Norwegian market while EU and local producers have lost shares. But the biggest gains have been made by lower cost regional exporters such as Romania and Turkey.
Six times a year, Textile Outlook International provides up to 200 pages of expert comment and analysis. A subscription provides an overview of the global fibre, textile and apparel industries. It is essential reading for senior executives in the fibre, textile and apparel industries – and for anyone who is not involved in the industry, but needs to quickly gain an understanding of the key issues.
Reports in Textile Outlook International include:
country profiles – providing a comprehensive guide to the textile and clothing industries in a range of countries and regions. The reports include an economic and political profile together with a comprehensive overview of the main issues, plus an outlook for the future.
company profiles – giving you the opportunity to learn from strategies employed by others. Companies profiled recently include retailers, manufacturers, innovators and sourcing companies involved in textiles and apparel as well as smaller companies which illustrate the opportunities for firms which are interested in selected sourcing locations.
trends in world textile and apparel trade and production – taking into account current issues facing the industry – such as global fibre prices; competition from China and other low cost countries; the elimination of quotas and imposition of selective new ones; relocation of production operations; the impact of economic factors affecting trade; international trade agreements; trade promotion agreements (TPAs); and much more.
trends in EU and US imports of textiles and clothing – providing comprehensive statistical data and analysis of the top ten supplying countries to the EU and US markets. These reports are updated each year and contain value and volume data as well as average prices and analyses of trends for up to 15 product categories.
innovations, technological developments, business development opportunities, individual sector analysis and political implications which affect players in the global fibre, textile and apparel industries. Some of the topics which have been covered in recent reports include: new innovations in the textile and clothing industry, such as environmentally friendly textiles, plant based fibres, and developments in textile colorants; innovations in textile machinery; and overviews of the European swimwear, hosiery and lingerie markets.
So whether you are involved in fibres, textiles or clothing – in manufacturing, spinning, weaving, knitting, sewing, import/export, retailing – or if you are in education or consultancy or investment or finance, a subscription to Textile Outlook International will tell you what you need to know about the key trends in the industry.
Textile Outlook International is available on subscription – either in printed format only, or in printed and electronic format. If you choose the printed only option, you will receive 6 printed publications a year, containing a total of 30 reports plus editorials written by Robin Anson, our editorial director and in-house industry expert.
Electronic supplement If you choose the printed and electronic option, you will receive an extra service. You will still receive each issue in printed format, delivered to you by traditional post.
In addition, you will be able to download PDF files containing the same information – but the PDF files will be available immediately on publication, so you don’t have to wait for the printing and mailing. You also have all the benefits of electronic files: instant access even when you are away from the office; convenient storage in your PC or laptop; portability; electronic search facility; and copy/paste facility.