NEPAL: Garment sector eyes new markets as exports drop
A slump in exports has prompted Nepal's ready-to-wear garment sector to try to diversify its target markets away from a past reliance on the US.
Exports have fallen by more than half over the past five years, and Ashok Kumar Agrawal, general secretary of the Garment Association of Nepal (GAN) blames decreasing demand from American consumers.
He told just-style the industry is hoping to "diversify export markets to Australia, Canada and Japan, making use of duty-free privileges while increasing exports to the EU," where they enter duty-free under the Everything But Arms deal.
He added: "Australia, Canada and Japan have rules of origin of their own, but Canada and Japan have relatively relaxed origin rules for least developed countries' textiles and clothing exports," he stressed.
Nepal's ready-made garment (RMG) exports were worth NPR7.3bn (US$85m) during the July 2005-2006 financial year, falling to NPR3.4bn (US$40m) for 2010-2011, Agrawal said, quoting figures from the country's central bank, the Nepal Rastra Bank.
RMG exports recovered slightly to NPR4.3bn (US$51m) for 2011-2012, but exports are still far from the 2005-6 mark.
The industry has been lobbying - so far unsuccessfully - to have the RMG sector included in the Nepal Trade Integration Strategy priority list, a government export promotion.
"But the government has not responded positively, despite repeated requests," Agrawal added.
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