EXPO Producciónejkrause.com.mx/camp17-produccion/presmemory/prod... · Confidential © 2017 Gerber...

Confidential

© 2017 Gerber Technology

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THE GLOBAL APPAREL TRADE

March 2017

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GLOBAL APPAREL TRADE

A Look At The Numbers

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• TEXTILES & APPAREL

• World Trade = US$ 744B; decline of 7.4% in Both Textiles &

Apparel

• Decline = Trade To Europe; US$/Euro

• Apparel Geographically

• -33% Asia To CIS

• -12% Within EU

• +14% Asia To Middle East

• +4% Asia to Americas

• +3% South/Central America To North America

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86% or US$390B >>> Top 10

*World Trade Organization WTO

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70% or US$349B >>> Top 10

IMPORTERS US$B % SHARE % CHANGE

EU 180-84=96 19% -8%

USA 97 19% 4%

JAPAN 29 6% -8%

HONG KONG 15-15=0 - -

CANADA 10 2% -2%

SOUTH KOREA 9 2% 1%

AUSTRALIA 7 1% 1%

CHINA 7 1% 7%

SWITZERLAND 6 1% -8%

RUSSIA 6 1% -34%

TOP TEN 349 70%

TOP TEN APPAREL IMPORTERS

*World Trade Organization WTO

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US APPAREL TRADE

A Look At The Numbers

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80% or US$64B >>> Top 10 Countries

IMPORTERS US$B % SHARE % CHANGE

CHINA 28 35 -9

VIETNAM 11 13 2

BANGLADESH 5 7 -2

INDONESIA 5 6 -5

INDIA 4 5 -1

MEXICO 3 4 -4

HONDURAS 3 3 -5

CAMBODIA 2 3 -14

SRI LANKA 2 2 -3

EL SALVADOR 2 2 -

TOP 10 64 80

TOP TEN APPAREL IMPORTERS TO USA

*Textile Intelligence / US Official Statistics

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WHY DOES ASIA CONTINUE TO

ATTRACT THE APPAREL

INDUSTRY

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LABOR CONTINUES TO BE THE DRIVER IN

WHERE APPAREL IS MANUFACTURED

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*Textile Intelligence / Werner International

Top 50

1 Switzerland 51.50

6 Germany 30.00

8 Japan 25.00

10 Italy 22.75

13 USA 17.75

16 Taiwan 10.75

26 Turkey 5.50

30 Colombia 3.50

33 Brazil 3.25

34 Mexico 3.25

37 China 2.75

44 India 1.00

46 Vietnam 0.75

49 Bangladesh 0.75

LABOR RATES

US$/Hr

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The Mexico / Central America Opportunity

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LOOKING AHEAD

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• But a number of factors could affect growth

• The possible changes to the USA’s trading policies to increase US

manufacturing

• The intention to introduce protectionist measures and reduce

imports

• Withdraw / renegotiate NAFTA

• But…such decisions would likely lead only to a decline in US

exports - trading partners most likely would retaliate

• Bottom line…overall import levels will largely remain

unaffected

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• But there will be changes to the US trade policies

• Which will lead to changes in geographical sourcing patterns; some

countries will gain…some countries will lose…at the negotiation table

• First rounds are likely China and Mexico

• Imports from Vietnam should continue to rise, despite

withdrawal from the TPP but likely to be slower than that in

recent years.

• Expected declines in imports from China and slowdown in

imports from VN should provide opportunities for other

countries; Mexico.

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• Mexico 3rd largest supplier to the U.S., since NAFTA US

exports up 468%; ~16% overall US exports.

• President Trump now says “tweaks” would make the trade

relationship “fair for both parties.

• Commerce Secretary Wilbur Ross = NAFTA "needs an

update“; has not adapted to changes in the three nations'

economies…Mexico and Canada are two vital trading partners

for the U.S.

• While the Administration has floated the idea of a 20% tax on

imports from MX, little has been said about changes that could

make the trade relationship more fair.

• Difficult to see massive changes to NAFTA relating to the

apparel industry

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• Withdrawal from TPP should not have big impact US exports;

US currently have trade agreements with most countries

• Clouded with legal actions; regulate fair / unfair practices.

• Agreement to work towards an equalization of imports to the

US with exports from the US

• Preference for bilateral negotiations

• Downside – missed opportunity for collective agreement on

intellectual property; defense presence, regularizing digital

trade, and providing disciplines over state-owned enterprises

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In Closing

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• Global Trade = Necessary to maintain the life style

accustomed and to enrich life experience globally

• Trade Agreements = Necessary to raise life style of developing

countries while providing an equal opportunity to all partners

• Global Clothing Industry Continues To Grow

• Global Clothing Industry Continues To Migrate (But Primarily

Within Asia)

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• Reshoring Is Real – But Not Massive; New-Shoring

Opportunity

• Manufacturing Costs Continue To Rise – Wage/Infrastructure

• Retail Prices Lag Behind Costs – Industry Will Migrate

• Fashion / Delivery Wins Higher Prices

• Customization Wins Loyalty

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THE CONSUMER IS KING!

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Thank You!

EXPO Producciónejkrause.com.mx/camp17-produccion/presmemory/prod... · Confidential © 2017 Gerber...

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