Inter-American Development Bank

Seminário Recente Regimes de Origem

Brasilia

26-28 September 2007

The Global Garment Industry&

The Parallax Gap

Brasilia27 September 2007

David Birnbaum

Unit Market Share FTAsYarn Forward

U.S. Garment Imports

0%

5%

10%

15%

20%

25%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

Un

it M

ark

et

Sh

are

(S

ME

)

Mexico

CAFTA

Unit Market Share FTAsYarn Forward

U.S. Garment Imports: CAFTA Majors

0%

1%

2%

3%

4%

5%

6%

7%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

Un

it M

ark

et

Sh

are

Honduras

El Salvador

Guatemala

Dom. Rep.

Unit Market Share FTAsThird Party Fabric

U.S. Garment Imports: CAFTA Majors

0%

1%

2%

3%

4%

5%

6%

7%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

Un

it M

ark

et

Sh

are

Honduras

El Salvador

Guatemala

Dom. Rep.

Unit Market Share: The Winners IGreater China

U.S. Garment Imports

0%

5%

10%

15%

20%

25%

30%

35%

40%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

Un

it M

ark

et

Sh

are

(S

ME

)

G.China

Unit Market Share: The Winners II

U.S. Garment Imports

0%

1%

2%

3%

4%

5%

6%

7%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

Un

it M

ark

et

Sh

are

(S

ME

India

Bangladsh

Cambodia

Indonesia

Vietnam

Unit & Value Market ShareWinners & Losers

2006 2007 % +/- 2006 2007 % +/-G.China 28.3% 34.6% 22.1% G.China 28.0% 32.8% 17.3%CAFTA 17.1% 16.0% -6.5% CAFTA 12.9% 11.7% -9.0%Mexico 7.3% 5.6% -22.9% Mexico 8.1% 6.5% -20.1%Vietnam 4.4% 5.2% 18.7% Vietnam 4.7% 5.6% 18.4%India 4.4% 4.3% -1.5% India 5.3% 4.9% -6.6%Bangladesh 5.8% 5.9% 1.6% Bangladesh 4.1% 4.3% 5.3%Indonesia 4.6% 4.8% 4.3% Indonesia 5.2% 5.7% 9.1%SSA 1.5% 1.5% -1.3% SSA 1.8% 1.8% -2.2%Cambodia 3.7% 3.6% -2.6% Cambodia 2.9% 3.3% 10.8%Jordan 1.4% 1.1% -22.6% Jordan 1.8% 1.5% -15.2%

Total 78.5% 82.6% 5% 74.8% 78.0% 4%

All Garment Products All Garment ProductsMarket Share in Units - Jan-July 07 Market Share by Value - Jan-July 07

Part II

Planning a Comprehensive

Integrated Strategy

It Is Not About Price: I

U.S. Garment Imports

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

FO

B P

CT P

rem

ium

/Dis

count

HondurasEl SalvadorGuatemalaDom. Rep

It Is Not About Price: II

U.S. Garment Imports: FOB Price

-60%

-40%

-20%

0%

20%

40%

60%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

PC

T P

rem

ium

/Dis

count

G. ChinaCAFTABangladeshCamobdia

It Is Not About Price: III

U.S. Garment Imports: FOB Prices

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

2000 2001 2002 2003 2004 2005 2006 07-07

Year

PC

T P

rem

ium

/Dis

count

IndiaMexicoIndonesiaVietnam

T-Shirt Analysis: Best Product IHighest Duty Rate

U.S. T-Shirt Imports

16.50%

32.00%

0%

5%

10%

15%

20%

25%

30%

35%

Cotton T Shirts Synthetic T Shirts

PCT Duty Rate

Duty

T-Shirt Analysis: Best Product IIHighest FOB Price

U.S. T-Shirt Imports

$2.97$2.69

$2.89

$3.22

$4.49

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

$5.00

AVER M Cot W Cot M Syn W Syn

Product

Ave

rag

e F

OB

Pri

ce

FOB

T-Shirt Analysis: Latin AmericaConcentration of Product I

T-Shirt Exports to U.S.

0%

20%

40%

60%

80%

100%

CAFTA MX HN ES NI GU DR CR

Country

Perc

en

t To

tal

by P

rod

uct

W SynM SynW CotM Cot

T-Shirt Analysis: Latin AmericaConcentration of Product II

CAFTA MX HN ES NI GU DR CRM Cot 48.7% 27.0% 60.2% 52.8% 49.1% 20.0% 46.1% 19.4%

W Cot 39.9% 51.9% 26.9% 32.2% 45.1% 73.4% 35.8% 39.1%

M Syn 9.5% 12.4% 11.9% 13.8% 4.7% 3.2% 8.8% 22.4%

W Syn 1.9% 8.6% 1.0% 1.1% 1.2% 3.4% 9.3% 19.1%

T-Shirt Analysis: Latin AmericaConcentration of Product III

U.S. T-Shirt Imports

38%

6%

20%

8%

5%3%

7.4%

2.6%3.9%

2.2%0.5% 0.5%

24%

9%7%

4% 4%

9%

1% 1%0% 0% 0% 0%

0%

5%

10%

15%

20%

25%

30%

35%

40%

CAFTA MX Hn Es Ni Gu

Country

Unit

Mark

et

Share

M CotM SynW CotW Syn