Blog: Sourcing uncertainty accelerates
Leonie Barrie | 28 November 2016
The result of the US presidential election shows how global events are adding massive uncertainty to apparel sourcing. The new president-elect has threatened to tear up the North American Free Trade Agreement (NAFTA) between the US, Mexico and Canada – and we’ve taken a look at what this might mean for the US apparel industry.
Trump has also confirmed he will take steps to end the landmark Trans-Pacific Partnership (TPP) trade deal on his first day in office.
A more insular climate in the US would likely drive growth in "onshoring" of manufacturing and jobs – a move that would hit Mexico and Central America the hardest due to their reliance on exports.
But while Mexico's apparel makers are concerned at the possibility of a 35% tariff on exports to the US, some also suggest the move could have unexpected benefits too.
The US presidential election result is likely to have little impact on holiday spending plans – but changes to trade, labour and tax regulation could all have far-reaching implications for the retail industry, analysts believe.
Another example of the key role played by trade regulations in apparel sourcing is the return of Madagascar to the export stage, with the island nation off the southeast coast of Africa bouncing back after the US reinstated its AGOA (African Growth and Opportunity Act) beneficiary status in 2014.
Meanwhile, the Alliance for Bangladesh Worker Safety says it stands by its progress in remediating the country's garment industry, following claims by labour rights groups that its efforts have been overstated and it is concealing a lack of action.
But there are calls for fashion brands to re-think their throwaway business model and produce clothing that's durable, repairable and fit for re-use.
And in other news, Adidas has produced the first performance shoe made from fibres based on spidersilk protein; South Korea's Sae-A Trading has supported another medical mission in Haiti; and Uniqlo owner Fast Retailing has set up its first Denim Innovation Centre in Los Angeles.
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