Blog: Leonie BarrieChina manufacturing continues to change

Leonie Barrie | 19 January 2016

US President Barack Obama last week used his final State of the Union address to appeal to Congress to ratifiy the Trans-Pacific Partnership (TPP) trade agreement.

But as reported on just-style, the exclusion of China, the world's largest garment maker, from the list of TPP signatories has hastened the decision by many of the country’s textile and apparel firms to accelerate their investments overseas.

A new report confirms earlier research that smaller TPP member economies such as Vietnam and Malaysia are set to see the largest GDP gains from the trade deal – but warns Vietnam may be hit by a double-digit rise in worker wages too.

Back to China, and some likely scenarios in 2016 include mass people movement, fewer jobs, and accelerated productivity growth. And manufacturing in China is changing, not disappearing – with the winners becoming even more competitive on a global scale.

Spurred by a December 2016 deadline, the European Union has also taken its first steps towards rethinking its trade ties with China – and whether or not to grant the country "market economy status".

Key apparel industry issues to watch in the upcoming year were the focus of just-style’s annual briefing published earlier this month. The reports combined the views of a panel of executives –but we’ve also condensed their words of wisdom into ten sourcing takeaways.

And as he refocuses his business on the next generation, consultant David Birnbaum explains why he believes the global garment industry is breaking apart – and how competing in the internet age requires all players to take an honest look at the problem and try to create realistic solutions.

Two recent forecasts have suggested that more than 20m tonnes of cotton is sitting in global warehouses. One question is how this figure correlates with garment production? The answer: There's enough cotton in global warehouses to make 17 T-shirts for each person on the planet.

Meanwhile, Mexico's apparel industry is facing a textile raw material shortage as the soaring dollar prompts spinners to boost exports, leaving many clothing makers struggling to procure key fabrics to meet US orders, a top industry official has told just-style.

The news that Marks & Spencer general merchandise head Steve Rowe is to become CEO has left a significant gap in the retailer’s struggling clothing division – and one that will need to be filled quickly if it is to address this problem area.

And in other news, Luen Thai has named Raymond Tan as acting president of its US division; Synergies Worldwide has hired former Li & Fung exec Guido Schlossmann as its new CEO; there are calls for safe transport for garment workers after a crash in Cambodia; and German retailer KiK is to use a vendor compliance management tool to help bring more transparency to its supply chain.


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