For developing country suppliers, no other service may be more important than sourcing to compete in the post-2005 era.

When quotas restricted Chinese clothing exports, manufacturers had to find new ways to compete. They diversified into producing every kind of garment, not just low-value products.

The levels of skill and service they acquired in the process set new standards in the industry, which they could fully exploit once quotas ended.

When big buyers and their suppliers use information technology in the clothing business, it is more than just adding computers to conventional commerce. It usually means suppliers take on new responsibilities.

Reverse Internet auctions put clothing manufacturers in competition with one another to offer buyers low prices. By teaming up with textile mills and trim suppliers, manufacturers can bid prices that won’t wipe out their profit margins.

An ITC project manager’s enthusiasm for cycling led to a historic link between ASSOS, one of the biggest names in cyclists’ clothing, and Textiline, a small, service-oriented Kazakh company. Together, they established the world’s first line of “after-bike” wear.

The end of quotas in the textiles and clothing industry benefits large Asian producers. Yet other countries also have a stake in the business. The sector plays a major economic role in many least developed countries, especially in Africa, and in other small, vulnerable countries. To avoid losing important business, their firms need to exploit duty-free advantages to the full, diversify products and expand their supply chains.

In August 1998, a young, would-be businessman returned home to Ruritania from a year of language studies in Europe. “They’ve got everything they think they could ever want there,” he told his doting parents. “But what they don’t have is anything like our Ruritanian widgets. A huge market is ready and waiting. All we need to do is convert that little factory down the road to mass production for export and our fortune will be made!” His enthusiasm was infectious. They set up to expand the family firm, ordered state-of-the-art Ruritanian widget-making equipment and hired hundreds of workers. Within a year, more widgets came off the production line in a week than the old factory had turned out for the Ruritanian market in a year and the warehouse was full.

Sheer, unforgettable magic. With house music setting a hypnotic pulse, psychedelic lighting injecting an edge and giant screens capturing the allure of the catwalk, a national fashion event that would not have been out of place in Paris, New York or Milan was held in Romania earlier this year. Stunning Romanian models were dressed to boost their country’s garment exports — a crowning achievement that reflects its successful partnership with ITC during its transition years.

Textiles and Clothing: What Happens After 2005? This article in Forum’s trade talks issue (2/2003) interested many readers. With quotas ending in 2005, many producers — and even countries — risk disappearing as garment suppliers in an oversupplied market. As a follow-up, we share a sample of your reactions, highlight ITC’s recommendations for action and outline the technical assistance it can offer.

US importers and retailers of textile and apparel are now focused on the shift in market dynamics post-2004. Speculation is mounting as it looks ever more likely that quotas will end for WTO members.

Some observers predict that by 2005-06, major textile and clothing buyers will reduce by half the number of countries they source from. The challenge for countries and companies is to remain an important source for these buyers. This article explores the coming changes in the market and highlights steps governments and exporters can take now to avoid adverse impacts.

The textile sector represents around 25% of LDCs’ total exports. Bangladesh alone accounts for more than 75% of textile exports, to the value of US$ 4 billion.

At ITC’s Joint Advisory Group Meeting (April 2000), the International Silk Association (ISA) took the floor to express its appreciation for its partnership with ITC:

“Ladies and gentlemen, ISA is a worldwide organization devoted exclusively to silk. Founded 50 years ago, it serves as a forum for every country in the silk business, either production, processing or trade. The Association has members in 40 countries, and includes the major silk producers.

Over the past few months ITC organized four events in Asian cities on the implementation of the World Trade Organization’s Agreement on Textiles and Clothing and related eco-labelling issues.

Silk has a miniscule percentage of the global textile fibre market—less than 0.2%. This figure, however, is misleading, since the actual trading value of silk and silk products is much more impressive. This is a multibillion dollar trade, with a unit price for raw silk roughly twenty times that of raw cotton. (The precise global value is difficult to assess, since reliable data on finished silk products is lacking in most importing countries.) To give an idea of the value, however, the annual turnover of the China National Silk Import and Export Corporation alone is US$ 2–2.5 billion.

Unlike some other textiles, silk-wearing traditions and demand go back a long way. A good example is India, where the local demand greatly exceeds supply (and hampers export growth). India has thus become the largest importer of raw silk, despite the fact that it is now the second largest producer. Some other silk producers are also experiencing fast-growing local demand, such as China, where consumers are increasingly able to afford the lower price range silk products. This pattern is also expected to repeat itself in Viet Nam.

Formerly a luxury trade, the silk industry is at a crossroads. New sandwashed silk brought a wider range of affordable silk products within the reach of millions of consumers during the 1990s. Competition from high-tech synthetics has eaten away market share. Raw silk prices have plummeted by half, to the point that they threaten the sustainability of this industry.

Traditional producers are cutting back on labour-intensive silk production, as urban industries lure farmers from a business in which incomes dropped radically in recent years. Meanwhile, millions of livelihoods are at stake, especially in rural areas, for this traditional and environmentally sustainable product.