COVID-19: An Opportunity for Revival of Philippines Textiles & Clothing Industry
After the outbreak of COVID-19, Philippines is upbeat that foreign buyers would continue to look at it as a source for clothes to be sold. And with the proposed passing of Corporate Income Tax and Incentives Rationalization Act (CITIRA) into law, new investments into the garment factories are expected to rise.
Philippines is a significant supplier of apparels all over the world. For the export earnings, the garment manufacturers of Philippines are looking at a flat growth this year as the COVID-19 pandemic has impacted the supply of raw materials for production. According to the Philippine Exporters Confederation Inc (Philexport), the export earnings of the garment manufacturers of the country have increased by 1 per cent only. According to data from the Philippine Statistics Authority, the country’s garment exports were valued at $906.289 million last year. Currently, the country’s apparel production has almost come to an end due to shortage of raw materials from China, Korea, Taiwan and other Asian countries.
Garment Player and Robert Young’s Opinion
Robert Young, trustee for the textile, yarn and fabric sector of Philexport and president of the Foreign Buyers Association of the Philippines, says that they don’t have domestic sources of fabric, textile and accessories. They are dependent mainly on the import of these items. After the outbreak of COVID-19, Young is upbeat that foreign buyers would continue to look at Philippines as a source for clothes to be sold. Players are also hopeful about new investments into the garment factories. Textiles and clothing manufacturers expect that investors would prefer the country once the proposed Corporate Income Tax and Incentives Rationalization Act (CITIRA) is passed into law.
CITIRA or the second package of the government’s tax reform programme would gradually bring down the corporate income tax rate to 20 per cent from 30 per cent, and rationalise fiscal incentives given to firms. He also said that the players expected more orders based on new factories with country’s advocacy on CSR (corporate social responsibility) and the improvement of the conditions of the factories. According to Young, US remained the country’s biggest market for garments this year. They also hope to add footwear and garments in the new US GSP that will come by December 2020. Currently, only the gift-wares are included in the US GSP.
provided by www.fibre2fashion.com