Rise seen in garment supply from ASEAN

“The strong supply chain of the textile industry in Asean together with closer cooperation under the Asean Economic Community will help reduce garment traders’ risks,” said Roy Ashurst, vice president of Polo Ralph Lauren Sourcing Co.
Many clothing firms have realised that they need to rely less on China after its government’s policy to focus on promoting domestic supply, which will increase prices and reduce supply to the global market.
China is the garment supplier to the world. Its exports account for 60 per cent of global output. Asean’s market share is still minute at only 6 per cent.
Polo Ralph Lauren and 19 other leading global brands and 35 Asean garment manufacturers attended the Source Asean Full Service Alliance Global Forum in Bangkok.
The event was aimed at encouraging the development of Asean’s textile and garment industries to serve the world market and providing a venue for business matching where producers and traders could meet and discuss establishing businesses in the future.
To strengthen the region’s capability to supply more garments to the world market, executives from Polo Ralph Lauren suggested that manufacturers join with investors in China, as that country will relocate its plants to Asean.
With low labour costs, plentiful sources of materials and growing ability to produce high-quality goods, Asean will become a stronger supplier to the company, Ashurst said.
Polo Ralph Lauren imports about 120 million pieces of apparel a year from 12 countries, mainly China and in Asean and South Asia.
Jeff Steinhart, president of Komar, a global garment brand, said his company would source more products from Asean to compensate for lower deliveries from China.
Despite concern that the global economic slowdown would dampen demand for garments in some markets, imports are expected to increase on higher prices.
“The company will try to maintain import volume and trading amounts at the same as this year’s figures,” he said.
It will order more goods from Asean, as the region can efficiently produce good-quality and high-standard apparel to serve the company’s
 requirements. Komar imports more than US$700 million (Bt22 billion) worth of apparel for distribution worldwide each year.
Pilan Dhammongkol, chairman of the Federation of Thai Industries, said Asean members must cooperate closely to reduce risk in the world market. The Source Asean Full Service Alliance would help ensure the continuing growth of the textile and garment industry.
He said the market share of Asean textile and garment exports would improve gradually each year, thanks to the strong integration of the industry.
More Thai garment and textile manufacturers will move to set up plants in other Asean countries to cut the costs of production and transportation, he added.
Ade Sudrajat, chairman of the Asean Federation of Textile Industries, said more Asean manufacturers were likely to invest across borders and firm up their production to compete with China.
The garment industry has high potential to grow as Asean has continued to develop its supply chain and adopt new technology, he said.
Nuntawan Sakuntanaga, director-general of the Export Promotion Department of the Commerce Ministry, said Thai garment and textile exports were expected to expand by 15-20 per cent this year.
Although there is weaker demand in some markets, mainly Europe and the United States, the strategy to focus on new markets and strengthen cooperation among Asean members has promoted the growth of the industry this year.