Cotlook A Index - Cents/lb (Change from previous day)

02-09-2019 70.15 (-0.20)

27-08-2018 87.95

26-08-2017 79.70

New York Cotton Futures (Cents/lb) As on 04.09.2019 (Change from

previous day)

Oct 2019 58.26 (-0.05)

Dec 2019 58.56 (-0.27)

Mar 2020 59.55 (-0.10)

04th September

2019

Textiles Secy promises to resolve Tirupur knitwear issues

Alarm at falling cotton price

India-Iran PTA to be concluded by 2019 end: Iranian envoy

Next 2 months crucial for economy: SBI Chief

'Big' free trade agreement coming soon with India, says Boris Johnson

Cotton and Yarn Futures

ZCE - Daily Data (Change from previous day)

MCX (Change from previous day)

Oct 2019 19480 (-140)

Cotton 12465 (-50) Nov 2019 19220 (-10)

Yarn 20215 (-75) Dec 2019 19230 (+40)

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2 CITI-NEWS LETTER

-------------------------------------------------------------------------------------- Textiles Secy promises to resolve Tirupur knitwear

issues

Alarm at falling cotton price

India-Iran PTA to be concluded by 2019 end: Iranian

envoy

Next 2 months crucial for economy: SBI Chief

'Big' free trade agreement coming soon with India, says

Boris Johnson

IRDAI sets up panel to revisit 3-yr old trade credit

insurance guidelines

Why are the Indian government and ratings agencies not

taking the economic slowdown more seriously?

Putting the skids under border trade

-------------------------------------------------------------------------------

'No deal' Brexit would cost at least $16 billion in UK sales

to the EU: U.N.

Economic Watch: China's industrial sector gains global

competitiveness

Indonesia to invest in US cotton with trade mission

Working hour reduction to create more difficulties

Centrestage to feature 100 local fashion brands

--------------------------------------------------------- ----------

NATIONAL

---------------------

GLOBAL

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3 CITI-NEWS LETTER

NATIONAL:

Textiles Secy promises to resolve Tirupur knitwear issues

(Source: Covai Post, September 03, 2019)

Tirupur Exporters’ Association (TEA) on Tuesday claimed that the Union Textiles

Secretary has promised to address various issues being faced by knitwear industry and

help for the growth of Tirupur knitwear export units.

The assurance came after a meeting with Secretary Ravi Kapoor in Delhi on Monday to

discuss the implementation modalities, course design, scope and breadth of the upskilling

component under Samarth Scheme and focus on improving the overall productivity

following best practices, TEA president, Raja M Shanmugham said in a statement here.

After discussions, TEA appealed for reimbursement of various schemes, including rebate

on state levies, amended technology upgradation funds and pending claims and subsidies

to meet the financial requirements of exporting units, he said.

TEA also sought removal of exporting units from risky exporters category and help them

continue to receive drawback and IGST claims. Kapoor promised to take up and address

the issues, he said.

Home

Alarm at falling cotton price

(Source: S Harpal Singh,The Hindu, September 03, 2019)

Traders apprehensive of compulsion to buy at MSP

The sharp fall in price of cotton bale in the national market and the declining exports of

cotton yarn is an ominous sign for the huge cotton trade and the processing industry in

erstwhile undivided Adilabad district. The trend is expected to have a direct and negative

impact on the price of raw cotton when the market opens for trading around Dasara

festival and going by past experience, it will result in discontent among farmers, at least

for a few days after commencement of trading.

The sensitivity of the matter can be gauged from the fact that nearly 3.5 lakh cotton

farmers contribute their produce to make undivided Adilabad a top trading centre in the

country. The cumulative production capacity in erstwhile Adilabad is between 16 lakh and

18 lakh bales and the turnover is about ₹ 5,000 crore during the six month season

starting October.

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4 CITI-NEWS LETTER

CCI may go slow

The anticipated downward trend of open market rate will force the Cotton Corporation of

India to launch its minimum support price operations right from the start of the trading

season. “The CCI, however, is expected to be slow in its operations as it is already saddled

with about 8 lakh bales from last season, thanks to the dipping price,” an industry source

pointed out.

“Trading is likely to be affected by the usual high moisture content issue at the start of

this season too according to indications. The administrations in all four districts should

start creating awareness among farmers to bring dry cotton to the markets in order to

avoid the produce being denied its proper price as,” cautioned B. Goverdhan Reddy, a

farmer leader from Telangana Rashtra Samithi party.

The government has increased the minimum support price of long staple cotton from ₹

5,450 per quintal last year to ₹ 5,500 per quintal which may be a welcome development

for farmers but traders and industrialists say it can spell doom for them.

Current downtrend

“The production cost of one candy of cotton bale (candy=2 bales of 178 kg each) comes up

to ₹ 47,500 while its price in December is ₹40,500,” Rajiv Mittal, a cotton trader and

processor compared the costs to drive home the point that traders will lose heavily if they

purchase cotton at MSP given the current downtrend.

“To benefit farmers, the governments can give them bonus money as direct benefit

transfer instead of insisting on private traders or the CCI go by MSP,” a trader suggested.

Home

India-Iran PTA to be concluded by 2019 end: Iranian envoy

(Source: Fibre2Fashion, September 03, 2019)

India and Iran can conclude a preferential trade agreement (PTA) by this year end as very

limited formalities are to be completed, ambassador of Iran to India Ali Chegeni said

recently. He, however, said the proposed Bilateral Investment Protection Agreement

(BIPA) will take a little longer as details on this front need some more approvals and

endorsement.

On the Double Taxation Avoidance Agreement (DTAA), Chegeni pointed out that this

agreement has the approval of Indian Government whereas approval of Iranian side on

this front is awaited.

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5 CITI-NEWS LETTER

The ambassador was addressing an interactive session on business opportunities in Iran

under aegis of the PHD Chamber of Commerce and Industry (PHDCCI) in New Delhi.

In the last few years, over 26 memoranda of understanding (MoUs) have been signed

between India and Iran to promote trade and economic ties, a PHDCCI press release

quoted him as saying.

The bilateral trade between the two during fiscal 2017-18 reached $17.5 billion, which

might go up to $35 billion in the next few years before hitting $ 50 billion with progressive

and conclusive trade talks and agreements between both sides at the highest level, he

added.

Barter trade between both sides should also be encouraged under a different trade

mechanism, at least to promote and intensify trade ties on commodities in agriculture

and pharmaceuticals, he proposed.

Home

Next 2 months crucial for economy: SBI Chief

(Source: Economic Times, September 04, 2019)

SBI chairman Rajnish Kumar reiterated his support for the government’s move to

consolidate state-owned banks.

The next two months are crucial for the Indian economy that’s facing its worst slowdown

in six years amid debate about whether the downturn is cyclical or structural as the key

automobile industry faces headwinds, said State Bank of India chairman Rajnish Kumar.

He reiterated his support for the government’s move to consolidate state-owned banks.

“If we see the automobile sector, today I read Kia Motors reported very good numbers…

That sector is going through a lot of churning,” Kumar told ET in an interview ahead of

SBI’s annual banking and economics conclave. “There are issues around environment,

change in public mindset. We don’t know how much of this is cyclical and how much is

structural… but October and November are two very crucial months for the economy.”

The success or otherwise of the festive season, which traditionally accounts for a bulk of

consumption, will determine whether Indians feel emboldened enough to resume

spending.

India’s growth slumped to a six year low of 5% in the June quarter.

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6 CITI-NEWS LETTER

‘Strong Execution Needed’

Monthly automobile sales have collapsed, in some cases as much as 50%, plunging

dealerships into losses and triggering job cuts. The government has announced stimulus

measures and reforms including a merger of state-run banks aimed at strengthening them

and bolstering credit expansion in order to revive growth.

“Suggestion to consolidate PSU banks was given 25 years ago… This had to be done,” said

Kumar. “If there is a strong execution team, then any credit slowdown can be taken care

of. The biggest issue is IT, human resource and customer integration.”

Finance minister Nirmala Sitharaman said last week that the government would merge

10 state-run lenders to create four mega banks that would help facilitate the flow of credit.

Home

'Big' free trade agreement coming soon with India, says Boris Johnson

(Source: Business Standard, September 03, 2019)

Boris Johnson met PM Narendra Modi on the sidelines of G7 summit in Biarritz, France,

last month

British Prime Minister Boris Johnson on Tuesday said that a "big" free trade agreement

(FTA) was among the key issues he discussed with Prime Minister Narendra Modi during

their meeting on the sidelines of the G7 summit in Biarritz, France, last month. In

response to a question on India-UK relations raised by Indian-origin Conservative Party

MP Shailesh Vara in the House of Commons on the summit outcomes at the end of

parliamentary summer recess, Johnson said he had an extremely good conversation with

Prime Minister Modi.

"We agreed to strengthen our cooperation, not just on the security side where clearly the

UK and India stand shoulder to shoulder in the fight against terror but also in military

cooperation in the Asia-Pacific region where we share many interests," Johnson said.

"This (the discussions) also included on free trade, in doing a big free trade agreement

with India, he said.

Home

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7 CITI-NEWS LETTER

IRDAI sets up panel to revisit 3-yr old trade credit insurance guidelines

(Source: Economic Times, September 03, 2019)

IRDAI said it decided to revisit the guidelines after it received

representations from various stakeholders

Insurance regulator IRDAI (Insurance Regulatory and Development Authority of India)

has decided to review its three-year old guidelines on trade credit insurance in line with

the changing requirements of the market. Trade credit insurance policy provides coverage

to supplier of goods and services against delay in payment or non-payments of trade

credit.

IRDAI said it has set up a nine-member working group headed by New India Assurance

CMD Atul Sahai with an aim to review March 2016 guidelines. The panel, which has been

asked to submit its report in three-months, would study the need and scope for changes

in the current guidelines keeping with the times and requirements of various segments of

market. As per the terms of reference (ToR) given to the panel, it would also suggest

suitable amendments to guidelines that add value to the policyholders and stakeholders

such as banks and factoring companies. Another key ToR is: "To examine the current

guidelines on Trade Credit Insurance and products available for catering to the needs of

credit insurance market in India." IRDAI said it decided to revisit the guidelines after it

received representations from various stakeholders.

They wanted the regulator to revisit the scope of the trade credit cover.

Home

Why are the Indian government and ratings agencies not taking the

economic slowdown more seriously?

(Source: Girish Shahane, Scroll.in, September 04, 2019)

Forecasts of GDP growth are unreasonably optimistic and consistently wrong

Why are economic forecasts so consistently optimistic? Why, on reading the bombshell

report that India’s GDP growth fell to 5% in the last quarter, the fifth consecutive quarter

of sequentially falling growth, did none of the forecasting agencies put out a note saying

conditions are likely to get even worse? Without exception, they see the slowdown as a

blip that will pass, and have their eyes set on the 8% growth that we think is India’s by

right, though it has rarely been touched in the past decade.

With each unexpected fall, ratings agencies recalibrate their charts, setting a new course

to the same wished-for destination. There’s always an excuse for things not working out:

one year, it is the effect of demonetisation, another, it is the Goods and Services Tax

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8 CITI-NEWS LETTER

rollout, a third it is the shadow banking crisis, and so on. At what point will they begin to

consider the blips not as blips, but a pattern of mismanagement that is likely to continue,

because the ruling party is incompetent and has no clue what good economic policies look

like?

Consider the agency Fitch Solutions. I’ve settled on it arbitrarily, others have been as bad

at their forecasts. Its response to the latest disastrous GDP reading was, “We at Fitch

Solutions believe that growth has likely bottomed out and will start to rebound over the

coming quarters.” That’s the tale it’s been telling for a long time. A year ago, Fitch

estimated India’s growth in the financial year ending March 31, 2019, would be 7.8%. By

December, it cut that to 7.2%, citing “higher financing cost and reduced credit

availability”. The final figure landed at 6.8%.

Cutting projections

Taking 6.8% to be the bottom, Fitch forecast a slightly healthier growth rate for the

current year, at 7 %, increasing to 7.1% the following year. In March, it cut that projection

to 6.8%, and in June dropped it further to 6.6%, before shifting to a 6.4% forecast after

last week’s figures, a rosier view than Moody’s, which now projects 6.2%. Fitch is far from

alone in being consistently optimistic and consistently wrong. The International

Monetary Fund’s projections following the global meltdown, which it failed to predict,

overestimated the world’s growth trajectory in each of the following years. But none of

these past errors should be taken to mean its current forecast is necessarily misguided.

Maybe the ratings agencies are correct that this is just a common, garden variety

slowdown caused by a bunch of one-time blows to the economy.

But what if it’s more serious? What if it goes beyond something that can be ameliorated

by merging a few banks, tinkering with GST rates, and commandeering a bigger slice of

the Reserve Bank of India’s surplus?

The Modi government has produced no fundamental changes to stimulate long-term

growth, aside from ones it inherited from the previous regime such as the Goods and

Services Tax. There is no word on reforming labour laws or making it easier for farmers

to sell land (which is very different from making it easier for the government to

expropriate land from farmers). Without resolving such serious bottlenecks, it is highly

unlikely the government will hit its target of making India a $5 trillion economy by 2024.

Indians are not only buying fewer biscuits and less underwear, but also fewer air

tickets and Mercedes Benz vehicles. The slowdown is evident across economic classes and

across sectors of the economy. When car sales fall by 30% from one year to the next, it

does not signal a common or garden variety slowdown. Those are shocking figures, which

will have severe knock-on effects on industries like steel manufacture.

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9 CITI-NEWS LETTER

The textile industry, a sector in which India ought to be a world leader given its over two

thousand year history of exporting cotton fabrics, is losing out to competition from

Vietnam, Indonesia, Bangladesh and Sri Lanka, and failing, in the process, to pick up

market share from China. Far from flourishing in global trade, it finds itself beleaguered

at home. This is not something that a drop in interest rates will come close to addressing.

A new Cold War

Meanwhile, the geopolitical situation is hardly likely to improve while a capricious lunatic

sits in the White House. The worst-case scenario for the global economy

was articulated last month by Nouriel Roubini, who spoke of a Cold War rivalry between

the United States and China that goes beyond a trade war and leads to a medium term

process of decoupling of supply chains and de-globalisation.

What seems remarkable to me, given all the negative data, is the complacence of India’s

government. Narendra Modi and his ministers are like the officers in a scene from Monty

Python’s The Meaning of Life. A man named Perkins has had his leg bitten off at night,

for which he blames a hole in the bed net that allowed mosquitoes to get through. A doctor

is summoned, who says, “Well, let’s have a look at this one leg of yours, then, eh? Yes…

Yes, well, this is nothing to worry about… keep warm, plenty of rest, and if you’re playing

football or anything, try and favour the other leg… be as right as rain in a couple of days.”

The Indian economy will not be as right as rain anytime soon.

Home

Putting the skids under border trade

(Source: Afaq Hussain, September 04, 2019)

The India-Pakistan face-off is having more repercussions than intended,

with border economies the worst hit

In February 2019, in the wake of the Pulwama attack, India decided to withdraw the Most

Favoured Nation (MFN) status to Pakistan; subsequently, it imposed 200% customs duty

on all Pakistani goods coming into India. After the Balakot airstrikes, again in February,

India and Pakistan closed their airspace,with Pakistan keeping the ban in place for nearly

five months. In April, India suspended trade across the Line of Control in Jammu and

Kashmir citing misuse of the trade route by Pakistan-based elements. And more recently,

post the Jammu and Kashmir Reorganisation Bill, Pakistan cut off diplomatic and

economic ties with India — expelling the Indian envoy, partially shutting airspace and

suspending bilateral trade.

Plunging trade

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10 CITI-NEWS LETTER

Escalating tensions between the two neighbours naturally led to the announcement of

retaliatory unilateral decisions, one after the other. Like in the past, the impact has

trickled down to trade relations between both the countries; this time it is much more

severe. In 2018-19, bilateral trade between India and Pakistan was valued at $2.5 billion

— India’s exports to Pakistan accounted for $2.06 billion and India’s imports from

Pakistan were at $495 million. India’s decision vis-à-vis withdrawal of MFN status and

imposition of 200% duty has hurt Pakistan’s exports to India, falling from an average of

$45 million per month in 2018 to $2.5 million per month in the last four months.

Western border trade

The quantum of loss that has been incurred by traders in both India and Pakistan has

varied according to the nature of trade and the trade route. For example, through the

Wagah-Attari land route, bilateral trade was heavily in favour of Pakistan; in the last two

years, India’s imports from Pakistan accounted for 82% of the total trade through the land

route. After February, most of this business has been badly affected with only a handful

of items including rock salt, continuing to be imported.

Unlike national economies, border economies owe their existence to cross-border

economic opportunities. These economies generally experience a sudden boom-bust cycle

on account of political changes, trade bans, price and exchange rate and tax fluctuations.

As seen elsewhere in South Asia such as via the inception of India-Bangladesh

border haats, the costs and benefits are mutual to the border economies on both sides;

much more in cases such as Amritsar where major economic activity is largely dependent

on border trade with Pakistan.

Amritsar is land-locked, is not a metropolis and traditionally has no significant industry.

Hence, any decision on India-Pakistan trade has a direct impact on the local economy and

the people of Amritsar. Since February, according to estimates on ground, 5,000 families

have been directly affected in Amritsar because of breadwinner dependence on bilateral

trade. Traders and their staff members, customs house agents (CHAs), freight forwarders,

labour force, truck operators, dhaba owners, fuel stations, and other service providers are

closing shop and going out of business. Of the nearly ₹25-30 crore that was being added

to the local economy of Amritsar every month, the estimate now is that three-quarters has

been lost in the last six months.

Many a time, upsetting the trade apple cart can have more repercussions than intended.

For example, gypsum, imported from Pakistan, was being used in India as well as in Nepal

for the cement plants there. To avoid empty backhauling on the return journey, trucks

carrying these consignments brought back specific products such as yarn from mills in

Uttar Pradesh to Punjab. In the absence of gypsum trade, the freight rate of trucks from

Uttar Pradesh to Punjab, as per the ground reports, has increased from ₹3 to ₹7 per kg,

with a single trip absorbing the cost of the entire journey. Earlier, prices of tradeable

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11 CITI-NEWS LETTER

goods which were kept under check owing to the balancing out mechanisms of

international trade, are experiencing fluctuations now because of the trade disruptions.

Pakistan takes a hit too

There is gloom on the Pakistani side too. With Pakistan deciding to completely suspend

bilateral trade, exports of cotton from India to Pakistan are expected to be affected the

most, eventually hurting Pakistan’s textiles; the lawn industry which will now have to

source pricier cotton from alternative markets in the United States, Australia, Egypt or

Central Asia; or there is a high possibility that Indian cotton, along with other products,

will be routed through third countries such as the United Arab Emirates and Singapore,

thereby increasing the share of indirect trade which is estimated to be more than double

the direct trade between India and Pakistan.

Hence, while the overall economies of the two countries may very well manage to stay

afloat despite the suspension of economic ties, it is the local economies that will suffer the

most and are already perishing. In this connection, there has been a loss in business, rise

in prices, lack of alternative sources of livelihood, as well as an expected increase in bank

defaults. There are also individual cases, for example a CHA in Amritsar, who has no

means to pay the equated monthly instalment for his home loan, highlighting the

hardship of locals dependent on border economies.

In the spirit of nationalism, the trade fraternity on both sides, by and large, has stood by

their respective governments. But locals in border economies on both sides have mouths

to feed, which calls for a solution. What are the alternative sources of livelihood that can

be generated to keep border economies afloat? Is there a sword hanging over the future

of other bilateral arrangements such as the transit of goods from Afghanistan through

Pakistan into India?

While it’s about damage containment for now, one can only hope that the appetite for

trade engagement still remains.

Afaq Hussain is Director and Nikita Singla is Associate Director, respectively, at the

Bureau of Research on Industry and Economic Fundamentals (BRIEF), New Delhi.

Home

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12 CITI-NEWS LETTER

GLOBAL

'No deal' Brexit would cost at least $16 billion in UK sales to the EU: U.N.

(Source: Reuters, September 04, 2019)

Leaving the European Union without a trade deal would cost Britain at least $16 billion

in lost EU sales, and probably far more after accounting for indirect effects and other

markets, a report by the U.N. trade agency UNCTAD said on Tuesday.

“UNCTAD’s research indicates that a no-deal Brexit will result in UK export losses of at

least $16 billion, representing an approximate 7% loss of overall UK exports to the EU,”

it said.

That would include $5 billion in motor vehicle exports, $2 billion in animal products and

a further $2 billion in apparel and textiles.

UNCTAD said the $16 billion figure was conservative, and only took into account a rise in

EU tariffs from zero to the basic “most favored nation” rate that it offers countries without

preferential deals.

“These losses would be much greater because of non-tariff measures, border controls and

consequent disruption of existing UK-EU production networks,” UNCTAD’s report said.

The report was published as Britain’s parliament debated a bid to stop Britain crashing

out of the EU on Oct. 31 without a transitional deal, which the European Commission

described as a “very distinct possibility”.

UNCTAD said 20% of Britain’s non-EU exports were at risk of higher tariffs in markets

such as Turkey, South Africa, Canada and Mexico - countries that have preferential trade

deals with the EU but have not yet agreed to roll over those benefits for British exporters

in the event of a “no deal” Brexit.

If Britain did not strike those deals before its exit from the EU, it would lose a further $2

billion in exports, with higher tariffs for cars, processed food, clothes and textiles, with

$750 million in forgone motor vehicles exports.

Still more losses could come if Britain failed to conclude rollover deals with Vietnam and

the MERCOSUR countries of Argentina, Brazil, Paraguay and Uruguay, which have

recently signed trade agreements with the EU.

Home

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13 CITI-NEWS LETTER

Economic Watch: China's industrial sector gains global competitiveness

(Source: Xinhua, September 03, 2019)

In the early 1980s, a steam turbine factory in inland China was at the brink of bankruptcy,

forcing its workers to produce kitchen knives to survive.

The factory now has turned into one of the world's largest manufacturer of power

generators, with its products and services exported to nearly 80 countries and regions.

The secret behind the transition, said Xu Peng, deputy general manager of Dongfang

Electric Corporation, was the company's relentless efforts in research and development

(R&D).

"Innovation is what brings us to where we stand today," Xu said.

Dongfang Electric is among the thousands of industrial firms riding on the tide of China's

rapid development over the past decades.

Since the founding of the People's Republic of China 70 years ago, the country has seen

tremendous progress in its industrial strength, with the manufacturing sector now

playing an indispensable role in the global industrial system.

Industrial value-added expanded 970.6 times from 12 billion yuan (about 1.7 billion U.S.

dollars) in 1952 to 30.52 trillion yuan in 2018, representing an average year-on-year

growth rate of 11 percent calculated at the constant price, according to data from the

National Bureau of Statistics (NBS).

World Bank data showed that China overtook the United States as the world's largest

manufacturing country in terms of added value in 2010 and has retained first place ever

since.

As the world's factory, the country now ranks first in the production of clocks, bikes,

furniture and beer, while it could barely make enough soap and clothing to meet domestic

demand 70 years ago.

The country's output of mobile phones, computers and televisions amounted to 1.8

billion, 310 million and 190 million units in 2018 respectively, accounting for about 70

percent to 90 percent of global output, NBS data showed.

Auto production stood at 27.82 million units in 2018, remaining first in the world.

"China not only has a competitive edge in the production of light industrial goods or

textiles but also is almost on par with the developed economies in terms of manufacturing

of high-tech products and major equipment," said Wei Jigang, a researcher with the

Development Research Center of the State Council.

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14 CITI-NEWS LETTER

Dongfang Electric made its way out of the inland province of Sichuan to the global stage

thanks to its high-tech advantage. In a laboratory test in Switzerland, its power generator

was proved 0.39 percent more efficient than its competitors in a variety of simulations.

"A 0.39-percent difference could mean an additional 50 or 60 million kilowatt-hours of

electricity a year for hydropower stations," said Zhao Yongzhi, an engineer with the firm.

The country has been stepping up its efforts to invest more in high-tech manufacturing

and upgrade its industrial sector.

According to the NBS, China's R&D intensity, or the proportion of R&D expenditure to

GDP, reached a record high of 2.19 percent last year.

"As the country shifts from high-speed growth to high-quality growth, technology will

power the industrial sector's future growth," said Tang Jiqiang with a think tank under

the Southwestern University of Finance and Economics.

Home

Indonesia to invest in US cotton with trade mission

(Source: Fibre2Fashion, September 03, 2019)

Indonesia will invest in US cotton after being a part of the 2019 Cotton USA

special trade mission. Eighteen cotton buyers from Indonesian textile mills and two

leaders of the Indonesian textile association attended the mission. The group visited six

stops in the cotton belt to learn about the seven segments of the US cotton industry and

met cotton leaders.

The mission educated the group on the many advantages of US cotton and developed

business relationships between the foreign trade and US cotton industry to help increase

business opportunities. After the event, the participants said they expect to purchase an

addition 194,000 bales of US cotton in the next year because of their participation,

according to Cotton USA.

The mission began in New York where the group met with ICE Futures, followed by a stop

in Raleigh, where it visited Cotton Incorporated and toured their research labs.

Afterwards, the group travelled west, stopping in Memphis to visit a USDA classing office

and to meet with the National Cotton Council (NCC) and representatives of the local

growing region. Later, the mission travelled to South Texas, visiting a farm and gin and

seeing some of the first cotton being harvested in the US. The group then travelled to

Lubbock and finished its tour in California where it met with representatives of the local

growing regions as well as Supima.

Home

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15 CITI-NEWS LETTER

Working hour reduction to create more difficulties

(Source: Vietnam Plus, September 03, 2019)

The reduction of working hours from 48 hours per week to 44 hours will create difficulties

for textile and garments enterprises, according to one leading expert.

Truong Van Cam, Vice Chairman of the Vietnam Textile and Apparel Association (Vitas),

in the response to the draft revised Labour Code which made the change in May this year.

The industry is facing many challenges. Reducing the working week would have a negative

impact on the industry and the economy, he said.

Currently, Vietnam sets normal working hours to not exceed 48 hours per week,

enterprises of many industries such as textile and garment, leather and footwear still have

to use all permitted overtime of 300 hours per year, he said.

"With the textile and garment industry with production scale at present, if we reduce by

four working hours per week, the industry’s export value will be reduced by at least over

3 billion USD per year," Cam said.

Vietnam is a developing country, so a reduction means a reduction of production in goods

and services, leading to reducing gross domestic product (GDP) for the society and GDP

per capita, Cam said.

"Moreover, if the working hour reduces, to maintain the same volume of production and

export value of the textile and garment industry at present, the businesses will have to

recruit more workers, spending more trillions of dong to pay salary for the workers," Cam

said.

"This is not feasible because at present, the textile and garment industry has faced labour

shortages and there is competition to recruit workers, especially skilled workers. Besides,

the businesses must increase spending, leading to a reduction in their competitive

ability."

For many years, enterprises in the garment and textile industry and some other industries

have repeatedly asked the State to extend the overtime to facilitate production, he said.

“We recommend not reducing the normal working hours from 48 hours per week to 44

hours,” Cam said.

“For overtime, I agree with keeping the regulation of overtime working hours per day

which is not more than 50 percent of the normal working time in a day.”

However, the existing regulation has caused difficulties for businesses, especially for

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16 CITI-NEWS LETTER

fashion and seasonal industries such as textiles, footwear and fisheries, he said. The

industries will have periods to promote production to ensure quick delivery, so they need

all overtime working hours.

At present, the State regulates overtime to be no more than 200 hours per year for general

industries and 300 hours per year for specific industries like textile, garment and

footwear.

Countries in the region also have much higher overtime hours than Vietnam. Therefore,

Vitas asked to extend the overtime working hour to 300 hours per year for general

industries and 450 hours per year for specific industries, he said.

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Centrestage to feature 100 local fashion brands

(Source: Fibre2Fashion, September 03, 2019)

The fourth edition of Centrestage, Asia’s premier fashion event, to be held from

September 4-7, 2019, at the Hong Kong Convention and Exhibition Centre (HKCEC), will

feature close to 100 local fashion brands. In addition, more than 40 exciting events will

be presented as part of Centrestage 2019, including over 20 fashion shows and parades.

Organised by the Hong Kong Trade Development Council (HKTDC), the event has

“Future Tribes” as its central theme with three distinct zones − Iconic, Allure and Metro

– showcasing some 240 local and international fashion brands.

The opening gala fashion show, Centrestage Elites, will feature Hong Kong designer Anais

Mak’s internationally renowned brand Anaïs Jourden, as well as acclaimed New York

designer Joseph Altuzarra’s brand, Altuzarra. They will have the global launch of their

pre-spring 2020 collections on the catwalk.

Following hot on the heels of Centrestage Elites, the Fashion Hong Kong Runway Show

will showcase the latest collections of seven homegrown designer labels – 112

Mountainyam, Doriskath, From Another Planets, Harrison Wong, Meiking Ng,

Methodology and Yeung Chin – that have taken part in other major international fashion

weeks in New York, London, Copenhagen, Tokyo and Shanghai to highlight Hong Kong’s

creative prowess.

Another Centrestage highlight will be the finals of the Hong Kong Young Fashion

Designers’ Contest 2019 (YDC) on September 7. Sixteen shortlisted candidates will

compete for five awards this year, with renowned Japanese designer Mihara Yasuhiro

serving as the VIP judge and special guest at the event.

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Other shows include the Redress Design Award, the Knitwear Symphony 2019, and the

ninth Hong Kong Knitwear Designers’ Contest presented by the Knitwear Innovation and

Design Society. The HKTDC will also organise the “Meet the Visionaries” seminar series

featuring representatives from the Centrestage Elites designers Anais Mak and Joseph

Altuzarra and YDC VIP judge Yasuhiro, while the “Trend Talk Series” will feature

prominent industry experts such as GOXIP vice president of marketing Michele Tardelli

and Euromonitor international head of fashion research Jorge Martin.

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