In what might appear to be a confirmation of what The Stitch Times has been telling are along, Textile Outlook International has stated that textile and clothing markets are likely to remain subdued in 2012, given the considerable uncertainty in the global economy, and the fact that the debt crisis in the Eurozone continues to hit business and consumer confidence.

In the EU economy, the recovery which started in 2010 is expected to be snuffed out in 2012. Forecasts suggest that the EU economy will suffer a second dip in2012 with GDP down in real terms by 0.5%. A partial recovery is predicted for2013 but GDP is expected to grow by only 0.8%, according to the latest issue of Textile Outlook International. The views of European textile manufacturers reflect this outlook. Having reported a notable recovery in their markets in2011, the recovery slowed markedly in the last quarter of the year and the view now is that the effects of Europe's economic turbulence will continue to have an adverse effect on trade during the remainder of2012 and perhaps beyond.Indeed, in the first quarter of 2012, EU clothing imports were down in volume by a dramatic 12.0%.

The prospects for the US are less pessimistic. In 2012 GDP growth is expected to accelerate to 2.2%, from 1.7% in 2011, before falling back slightly to 2.1% in2013. Nevertheless, clothing imports continue to be affected, with the volume of imports in the first quarter of 2012 down by 3.9%.

Weak market conditions in the EU and the US affected exports from several Asian countries in the first quarter of 2012, following strong growth in 2011 as a whole.

In Indonesia, for example, textile and clothing exports rose in value by 18.2% in2011 but fell by 5.2% in the first quarter of 2012. In Thailand, exports rosein value by 7.5% in 2011 but declined by a sharp 15.3% in the first quarterof2012. And in the Philippines, clothing export growth slowed in value to just1.1 % in the first quarter of 2012 following an 11.4% rise in 2011. Export growth also slowed in several other countries.

In India, meanwhile, clothing exports fell in value by a sharp 11.9% in the 2011/12 financial year, which ended on 31 March 2012, having increased by 4.7% in the previous year. Textile export growth, meanwhile, slowed to just 0.4%, having risen by 34.7% in 2010/11. Reflecting the country's weaker export prospects, Indian GDP growth forecasts for 2012 have been revised downwards. In September 2011 it was forecast that India's GDP would grow by 7.5% in 2012 but in April 2012 this forecast was revised downwards to 6.9%. Furthermore, in the first three months of 2012, Indian GDP rose by only 5.3%, which represented the slowest quarterly growth rate in India for nine years.

The prospects for China - which has long been an engine of growth for the world economy - are similar, with GDP growth forecasts lowered from 9.006 to 8.200.

As a result, global GDP is expected to grow by only 2.1% in 2012 after increasing by 2.5"6 in 2011 and by 4.1 % in 2010. Nevertheless, emerging markets and, in particular, the so-called BRIC countries - comprising Brazil, Russia, India and China - will continue to be the key to sustaining global trade growth over the coming years.

In India, for instance, the domestic market for textiles and clothing is forecast to increase in value by 169% over the ten-year period between 2010 and 2020, from an estimated US$52bn to US$140bn.

This article was originally published in The Stitch Times magazine, August, 2012.