Tunisia’s garment industry is exploring a post-Covid near-shoring strategy as part of a recovery plan to rethink the country’s positioning as a sourcing centre.
The Tunisian textile and clothing federation, the FTTH (Fédération Tunisienne du Textile et de l’Habillement) has commissioned a report on the impact of Covid-19 on this outsourcing centre – including policy options to enable companies to recover.
It will work with the Middle East and North African wing of the Global Textiles and Clothing Programme (GTEX/MENATEX) over two months to generate a post-pandemic plan.
Nacer Bouyahia, the national coordinator for GTEX MENATEX Tunisia, part of the UN’s International Trade Centre, says the study will “scan the sector to see – with scientific methodologies and a statistical approach – the real impact of this pandemic on the Tunisian textile and clothing sector at national and international levels.”
He told just-style the findings will include a recovery plan that will help the FTTH and the ministry of industry and commerce “rethink the positioning of Tunisia in the Euromed region” as a sourcing centre and “establish a short-term strategy.”
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This might include promoting Tunisia as a near-shore alternative to China and Southeast Asia.
Sourcing switch
Haithem Bouagilia, a member of the FTTH executive bureau and managing director of the Soliman-based knitwear specialist Tunicotex Group, predicts a post-Covid sourcing switch away from Asia “to focus on Euro-med based producers.”
Bouagilia told just-style that he was concerned about the lack of “visibility” regarding Tunisia as a sourcing option, as the fashion market starts to recover amidst a general loosening of lockdown.
“Some clients from Germany and Poland have begun to send orders again. However, Tunisia’s traditional client base in France and Italy are not returning with orders at a level that enables Tunisian garment producers to function normally,” he says.
The FTTH executive member says Tunisian suppliers needed to be aware that at present, “the old [fashion retail] business model is broken” and that fashion houses are currently struggling to finance collections.
Worst-hit segments
As it stands, Nafaa Ennaifer, director general of the Tunis based garment manufacturer TFCE Group, told just-style the “worst hit segments” in Tunisia from lockdowns are fashion, swimwear, lingerie and sportswear.
Factories specialising in general workwear have been able to pivot to produce personal protective equipment (PPE), particularly single use masks, although even here “there is a problem in sourcing primary material for PPE from Europe.”
Moreover, specialist manufacturers, such as denim makers – an important category for Tunisia – have been “disadvantaged” by the slump, he says.
On the plus side, Tunisia’s swift action to minimise the effects of Covid-19, imposing a lockdown on 21 March, including a nightly curfew, has resulted in the country having the lowest recorded cases and deaths in North Africa (except chaotic Libya, where statistics are unreliable).
Also, before the pandemic, industry leaders were predicting strong 2020 growth in the garment sector. This optimism has now evaporated, of course and Bouyahia says he regrets the government did not take forward the advice of a GTEX/MENATEX and FTTH study in 2018 that recommended projects that would encourage vertical integration within the industry.
This could have helped Tunisia take advantage of any future near-shoring, but “unfortunately this plan was not progressed due to a lack of available investment funds.”
Back in March, Tunisia’s textile and garment sector was warning of major commercial and humanitarian damage because of production stoppages and order cancellations resulting from the coronavirus crisis.
