Blog: Sourcing worries in Turkey and Tunisia
Leonie Barrie | 24 January 2011
As protests continue to break out in Tunisia following the collapse of the regime of deposed President Ben Ali, the country's key textile and clothing sector is gradually returning to work, just-style was told last week.
Indeed, while some companies reported a shortage of staff and said customs clearance problems were disrupting imports and deliveries, there were no shut-downs, despite the mass protests that brought down the government.
But a new set of worries has sprung up for firms sourcing from Turkey, as the government wants to introduce anti-dumping duties on clothing and textile imports to protect its domestic industry from surging foreign shipments.
The planned measures will affect all countries with which it does not have a free trade agreement, and could see an additional duty hike of 27% for least developed countries (LDCs) like Bangladesh and Cambodia, up to a maximum of 40% for others.
While just-style has learnt negotiations are under way to ensure every part of Turkey's apparel industry supports the potential introduction of anti-dumping duties, the measures would hit clothing exports to the EU as well as sales of Asian fabric to Turkish manufacturers.
With China continuing to be a pillar in the growth plans of many of the world's largest consumer goods groups and retailers, figures out last week should have been encouraging. China is already the World's second largest economy, and Chinese authorities said the country's economy grew 10.3% in 2010, marking the fastest annual pace since the onset of the global crisis. According to estimates, China could overtake the US to become the largest economy in the World by the 2030s.
But while the West struggles to take any step towards growth, the fear for China is that it is close to overheating, particularly with regards to inflation, which was running at 4.6% and a credit boom the government seems to be struggling to curb.
Success in China was a cornerstone of strength in Burberry's third quarter, helping the luxury goods firm to a 27% increase in sales and contributing to forecasts that its full-year profits will come in ahead of expectations. Its retail operations also stood out, with underlying sales up by 36% as the brand continues to gather momentum.
While green issues and corporate social responsibility continue to make waves among some fashion companies and retailers, consumer pressure is key to persuading the industry's "silent majority" to take it seriously, according to a new report from just-style. The Green Report also suggests that governments and pressure groups feel that they can only try to persuade the industry to be responsible, rather than taking firm action.
"The industry itself is split between the silent majority, who think it is none of their business (they are tasked with making money) and the vocal minority who either take a moral stance or equate sustainability with good business practice," it says.
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