Garment exports rise 26%, but exporters displeased

Sales volume remains stagnant as foreign buyers shy away.

Our Correspondent October 29, 2012

KARACHI: While exports of readymade garments in September increased by 26.5% in dollar terms compared to the corresponding month last year, the quantity of readymade garments that Pakistan sold overseas remained almost flat with a growth of only 2.3%.

According to data recently released by the Pakistan Bureau of Statistics (PBS), Pakistan exported readymade garments worth $140.5 million in September, which is more than one quarter higher than $111.1 million that the country earned in September 2011.

“Our major roadblock is that few customers are willing to visit Pakistan now. Their reluctance to come to Pakistan has resulted in almost no new customers,” said Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Zonal Chairman Atiq A Kochra while speaking to The Express Tribune.

Total textile exports in September remained at $1.1 billion. The share of readymade garments, excluding knitwear, in the textile exports was 12.7% in the month.

Kochra said another reason why foreign buyers shied away from placing orders in Pakistan was a longer processing time. “The energy crisis has hit the textile sector badly, which has resulted in longer lead time for garment-makers. It now takes two and a half times longer to receive processed fabric from our suppliers,” he said.

Cotton cloth represents the largest share in the country’s textile exports. With shipments worth $227 million in September, the segment accounted for 20.5% of the total textile exports. They increased by 14.4% year-on-year in dollar terms, although there was a volumetric decrease of 1.2% over the same period last year.

Contrary to cotton cloth, exports of cotton yarn recorded a healthy growth during the period under review. The volumetric increase in the segment was 45.8%, as Pakistan exported $201.6 million worth of cotton yarn in September, which was up by 40.8% compared to the corresponding period last year.

Export figures for raw cotton, knitwear and bedwear for September remained dismal in terms of value as well as volumes. There was a drop in export earnings in raw cotton and bedwear categories, which shrank by 8% and 7%, respectively. Knitwear exports were almost flat with less than 1% growth in both value and volumes.

Without giving an exact figure, Kochra claimed many garment manufacturers shut down their operations permanently in Karachi because of the energy shortages and continuing law and order problems.

There are over 600 members of PRGMEA in Pakistan, almost half of whom are based in the Sindh and Balochistan region.

Speaking about the fire in a garment factory in Karachi on September 12 that killed more than 250 workers, Kochra said foreign buyers were increasingly cautious when it came to outsourcing manufacturing operations to Pakistan. “There’re clear signs that our textile sector is going to be affected, at least in the short run, because of the last month’s unfortunate incident. Our members have reported having many ‘surprise visits’ by their major foreign buyers. There’re obvious concerns about compliance and regulatory framework,” he said.

However, he said the garment manufacturers in Pakistan took the deadly fire as a wake-up call. “I believe that the increased emphasis on compliance and safety measures is going to benefit our sector in the longer term.”

Pakistan exported woven and knitted garments worth $3.6 billion in 2011-12 as opposed to $4 billion in the preceding year, reflecting a drop of 11.5%. Overall, they have increased at an annualised rate of 7.7% between 2001-02 and 2011-12, according to the Trade Development Authority of Pakistan.

Published in The Express Tribune, October 30th, 2012.


Googly | 9 years ago | Reply

Exports increase in dollar terms, but the volume remains the same......meaning that our cost of production has increased due to higher energy and input costs, forcing us to quote higher prices to our buyers to meet the costs....while some buyers may have been forced to pay higher for the same quantity temporarily as they do not have alternate arrangements in place, it can be seen that these buyers have already started shifting the production to other countries, Bangladesh, Sri Lanka, India which are able to supply at lower prices....There is no point in crying about such simple problems before the government as supporting industry, creating and sustaining jobs is sadly not their priority. All they need is "blind votes" and that too for 5 yawning years. May Allah save us !!

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