Making the Cut? Low-Income Countries and the Global Clothing Value Chain in a Post-Quota and Post-Crisis World
The clothing sector has traditionally been a gateway to export diversification and industrial development for low-income countries (LICs) but recent developments may condition this role. In most developed and middle-income countries, the clothing s...
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| Format: | Publication |
| Language: | English |
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World Bank
2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000334955_20110107051736 http://hdl.handle.net/10986/2547 |
| Summary: | The clothing sector has traditionally
been a gateway to export diversification and industrial
development for low-income countries (LICs) but recent
developments may condition this role. In most developed and
middle-income countries, the clothing sector was central in
the industrialization process. Recently, however, the
environment for global clothing trade has changed
significantly, driven by the rise of organizational buyers
and their global sourcing strategies, the phase-out of the
Multi-Fibre Arrangement (MFA) at the end of 2004, and the
global economic crisis in 2008-09. Changes in global supply
and demand structures have increased competition between LIC
exporters but also offer new opportunities in fast-growing
emerging markets. The second half of the twentieth century
was characterized by a rising demand for clothing and the
replacement of developed countries' domestic production
by imports from developing countries. Today, however, demand
has stagnated and import penetration levels are close to 100
percent in most developed countries. Thus, the growth of
clothing exports from a few developing countries largely
comes at the expense of clothing producers in other
developing countries. The heightened competition between
developing countries has been reinforced by overcapacity in
the global clothing industry since the MFA phase-out and has
been accelerated by the global economic crisis. However,
changes in demand structures post-crisis may lead to new
opportunities. While import demand for clothing in the
Unites States, the European Union (EU), and Japan might
stagnate, demand will increase in fast-growing emerging markets. |
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