An analysis of apparel imports into the EU, and the countries which have prospective markets.


EU is more aggressive in safeguarding the interests of its local manufacturers,and consumers. It has imposed strict limitations for importing apparels into the country driving major changes for manufacturers and exporters; globally. Despite all stringent regulations, apparels imports into the EU saw a growth both in volumes, and value during the last year. Improvement in the consumption of European countries led to an increase of 7% in the clothing imports of the country especially from the Asian countries. In 2010, countries exporting apparels to the EU enjoyed a healthy growth both in volume, and value,comparatively over the previous years figures.

EU has a huge and diversified market with numerous product needs, and preferences. The much, this fact makes it attractive, that much, it is also complicated. Market is dominated by demand in small quantities, more fashion savvy, and with a greater emphasis on eco-friendly merchandise. Big exporters focus on large sized retail formats, while smaller exporters work with chain stores, and boutiques. Compared with India, the UVR (Unit Value Realization) of Pakistan, China, and Bangladesh were lower. For per kg of fabric equivalent, China registered a UVR of €12.67, Bangladesh with €9.50, Pakistan with €8.38, Vietnam with €15.47, and Sri Lanka with €16.82.

India:

EU is a major market for Indian exporters as different exporters have different products, and can focus on different countries. Increasing number of Indian exporters, who are currently exporting to the US are seeking entry into the European markets for growth to balance their trade between the two major markets of EU, and US. Though India saw an increase in the export figures, still it is not able to keep pace with its counterparts as prices were not competitive, comparatively. UVR was higher with €16.20 compared with the €15.72 during the same period in the previous year. Foundation garments registered a growth of 214.09% growth. Blouses and ladies dresses are a major growth segment.

China:

Chinas exports were the highest among its Asian competitors. Its exports to EU saw a slight decline after prices of apparels increase due to the hike in raw material and labor costs. Biggest export item for China are trousers with an export figure of €4,161.09 million. This is an increase of 6.73% in value. Sweaters, the third biggest import category of EU, and the second biggest export item for China registered a marginal loss in terms of volume. Despite the loss, in terms of value, sweaters gained 7.36% during 2010.

Vietnam:

Vietnams apparel exports mainly comprise of shirts, T-shirts, trousers, kidswear, and coats accounting for 1.98% of the EU market share during 2010. The country is currently emerging as a strong substitute for China. The higher UVR also indicates that Vietnam would not be a cheap manufacturing base. Major export product of Vietnam is trousers witnessing an 11% growth compared with the previous years exports.

Vietnam is also facing some difficulties regarding its exports to the European market due to different in tastes, style, language, and business culture. Goods exported to EU are sold in 27 different countries.

Sri Lanka :

Sri Lanka saw a positive growth with the exports surging by 7.04%. The country saw a growth in the export of trousers with a marginal gain of 1.19% in value. Earlier it was feared that loss of GSP benefits meant that Sri Lankan exporters would lose duty free access to EU markets and their shipments would be charged with an import duty of 9.6%. But the impact was not as bad as it was feared. The country is getting good volume of overseas orders attracted by its quality, and timely delivery. Unrest in big apparel export countries like Egypt is also helping to enhance Sri Lankan exports.

Bangladesh:

Bangladesh is emerging as a major competitor in the knitwear category. T-shirts accounted to be the second largest export category to EU with an increase of 1.27%. T-shirts are the biggest product category of export for Bangladesh and registered a gain of 12.42% in value.

Pakistan:

Pakistan, a country with the lowest UVR, has moved up the value chain. Exports moved by 1.30%. An increase was seen in the exports of knitwear. It saw a growth of 4.66% which was positive compared with the previous years decline of -10.59%.

Manufacturers who export to EU are facing a challenging situation of creating a product and bring this to EU which constitutes of 27 different countries with varied tastes, styles, and preferences. The Government also has many strict legal proceedings, and regulations intending to protect its people and environment. It is further looking for protectionism policies to secure its domestic production. Despite all challenges, Asian countries are seeing a profitable market in exporting to EU.


References:

  1. Data source: Apparel Online, April 1-15, 2011
  2. textiletreasure.com
  3. apparelresources.com
  4. vietnambusiness.asia
  5. lankabusinessonline.com