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Japan's Labor Shortage
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Trade Pacts 
Tied to TAA
Page 1

Textile Trade Restrictions
Page 1

Apparel Firms Fight Back
Page 1

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June 1, 2011                                            Issue #290    The McPete Sez Lingerie Newsletter & Women's Wear Journal           

                              Intimate Apparel

Japan's Labor Shortage
As if Japanese textile and clothing manufacturers did not already have enough to worry about following the damage caused by the earthquake and tsunami in March, there are now fears it could cause a labor shortage too.
The nation's knitting, weaving and sewing industries employ tens of thousands of foreign trainees, most of them on three-year technical assignments from China, Indonesia and the Philippines.
The Japan Textile Federation estimates that three-quarters left the country after the natural disaster struck, many under pressure from parents whose biggest concern was the potential impact on human health of the disaster at the Fukushima Dai-Ichi nuclear plant.
The workers come to Japan under a government-authorized scheme, with around 200,000 in employment before the earthquake. Of that total, some 27.6% work in the clothing and garment manufacturing sectors.
The federation said it has received no clear indication of the number of trainees that fled, but it estimates that 30,000 have failed to return to their jobs.
By law, Japanese companies are required to keep the number of foreign trainees below 20% of their total workforce, but if the trainees do not return then the industry would be forced to cut production drastically, a statement from the federation said. 
"While production is being shifted abroad, the domestic industry in Japan has been able to survive by making high quality and high value-added products," it said. "But the industry could fall apart due to the earthquake disaster and the nuclear accident."
Without cheap imported labor, clothing and yarn producers and dyers would have to employ more expensive Japanese workers, intensifying pressure from overseas competition according to the federation.

Trade Pacts Tied to TAA
The passage of three pending trade deals with Colombia, Panama and South Korea has hit another stumbling block after the Obama administration linked their progress to the renewal of an aid program for US workers.
The Trade Adjustment Assistance (TAA) scheme, which provides retraining and other assistance for American workers who lose their jobs because of foreign competition, expired earlier this year.
But now the White House says it needs the support of Congress to renew the TAA before the legislation on the three trade deals can be signed off.
“The Administration expects to work with Congress on a strong and robust TAA renewal that supports Americans who need training and other services when their jobs are affected by trade,” a statement said. “TAA is a key component of our comprehensive legislative agenda for trade policy.”

   Fashion Photo
Laurie Huff Modeling Mystique

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Textile Trade Restrictions
The chiefs of three international agencies have warned leaders of the G20 group of countries that their governments have put in place more new restrictive trade measures in the last six months.
Trade in textiles, apparel and cotton were all targeted, and feature among the 122 new restrictions taken by G20 economies from mid-October 2011 to mid-April 2011. The restrictions range from tariff hikes and anti-dumping investigations to licensing and export constraints.
"Their restraint to resist protectionism appears to be under increasing pressure," warned World Trade Organization chief Pascal Lamy, Organization for Economic Cooperation and Development secretary-general Angel Gurria, and the head of the UN Conference on Trade and Development, Supachai Panitchpakdi, in their reports submitted to G20 leaders on May 24.
Lamy said that collectively the measures "are feeding fears" that protectionism following the recent global crisis may be gaining momentum.
Measures ushered in have included the re-introduction by Argentina of an import ban on used garments, and the extension of the list of products, which includes textiles and apparel, subject to non-automatic import licensing.
On February 24, Russia (and also Belarus and Kazakhstan, which are part of a common free trade area) increased import tariffs on woven fabrics from 5% to 10%.
Similarly, India terminated the export ban on cotton yarn and replaced it from March 31, with a new notification that requires exports of cotton yarn to be registered with the directorate general of foreign trade.
Turkey, a major textile and apparel exporter, also initiated in January a safeguard investigation on imports of textiles and apparel, and a provisional duty is expected to be imposed on July 22.
The WTO estimates that the new import restrictive measures taken by G20 economies cover about $56.5bn or 0.6% of total G20 imports.

Tia Lyn Lingerie 14/24 Watch Tia Lyn's NY Fashion Show with beautiful models of ALL SIZES!

TESA Bill Reintroduced
A group of US lawmakers are planning to reintroduce a textile-specific customs enforcement bill designed to crack down on illegal trafficking of yarn and duty evasion.
The Textile Enforcement and Security Act (TESA) would help the US textile industry to compete in the global marketplace according to US Senator Kay R Hagan (D-NC), who is working with Representatives Larry Kissell and Walter Jones to reintroduce the bill.
"Right now, our yarn and fabric producers in North Carolina and throughout the country are competing in an unfair trading environment that is costing American jobs," she said.
"This bill will ensure our hard working textile workers no longer suffer because of the illegal actions of foreign companies."
The legislation proposes an electronic verification program that tracks yarn and fabric imports in countries operating under free trade agreements, as well as an increase in the number of textile and apparel verification specialists at the 15 largest US ports that process these imports.
It would also increase textile staff at the Customs and Border Protection Agency headquarters and re-target them toward trade preference verifications, and require the publication of a list of those who commit fraud.

16/24    CLICK HERE to watch Risque's Video on YouTube

Apparel Firms Fight Back 
Apparel producers and exporters have hit back at textile groups who earlier last month claimed the government's recent restrictions on cotton yarn exports have led to stockpiles.
Around 1998 Indian spinning mills took part in a one-day closure on Monday May 23, to highlight the sector's problems. 
In particular they say they were hurt by falling cotton yarn prices and reduced domestic demand when the government restrictions were lifted - and are now slashing production by around a third in a bid to reduce inventories.
But the Apparel Export Promotion Council, The Clothing Manufacturers Association of India and Tirupur Exporters Association claim the allegations are "unfounded."
"The entire apparel and value add industry appreciates the Textile Ministry's and the UPA government's strong resolve to protect domestic consumers and domestic jobs by ensuring availability of raw materials, such as cotton and cotton yarn in sufficient quantity for home consumption."
Instead, the apparel groups believe falling demand for cotton is the result of "unprecedented" price hikes in the preceding year, thanks to speculation and hoarding of raw cotton and cotton yarns.
They also claim falling yarn prices reflect the recent fall in the price of raw cotton - but that the mills face a crisis because they bought cotton at much higher prices.
"The apparel industry very badly suffered, as they were unable to pass on the steep price increases to the final customers, due to price resistance," the groups say, adding that apparel buyers have been scared away by the high pricing of raw materials.
"The apparel industry is not in favor of artificially controlling supply of yarn by curtailing production. In case this were to happen, the industry would demand that the government make import of cotton yarn duty free, so as to provide a level playing field."

Pension Protests in Sri Lanka
Factory workers from the Katunayake free trade zone, Sri Lanka's largest trade zone, blocked the road to Bandaranaike International Airport on May 24, in protest at government plans for a pension scheme for private sector workers.
Workers and trade unions want the government to discard, or radically alter, a proposed private sector pension bill due to be presented in Parliament next week.
Factory workers protesting in Katunayake said the pension scheme, in its current form, did more harm than good.
"The government is taking the money for the pension scheme by cutting off a percentage from our wages and by taking 10% from our gratuity payments," Irosha Kumari, a 21-year-old garment factory worker told just-style.
"They then have these rules saying we can't get our money until we are 60 years old. They are also saying you have to work for 10 years to qualify for the pension payments. So that means, if I stop working in the factory after five years, to get married, I won't get anything - not even the money they cut off from my salary."
Older workers are also unhappy. Under current Sri Lankan labor 
law, women can withdraw their full savings from the statuary workers' welfare funds when they marry, or when they reach 50 years of age.
If the pension scheme is introduced they will not get this lump sum payout - instead they will get a monthly pension payout. 
However, many employees prefer to collect their savings as a lump sum, rather than get a small monthly pension.
Ms Chamila Thushari from Da Bindu, a women's rights organization also campaigning against the pension scheme, claims a large majority of the country's 250,000 garment factory workers will lose out because they work, average, for just five years.
Trade unions say the pension payment, based on current wages, is only around LKR1,900 (US$17.27) per month for garment workers.
The garment industry, which already has a problem with high vacancies in factories, is likely to be hurt further as many factory workers are likely to resign ahead of the pension scheme coming into force.
Trade union sources said even garment factory owners are unhappy with the proposed pension scheme because employers are also mandated to contribute a payment to the scheme. Factories feel this will put up their costs further, on top of annual wage increases.

Manila's Minimum Wage
The minimum wage in the Philippine capital Manila has been increased by PHP22 ($0.51) in a bid to help workers cope with rising living costs.
The cost of living allowance, or COLA, approved earlier this month by the Regional Tripartite Wages and Productivity Board, brings the daily payment for non-agricultural workers in Manila to PHP426 per day.
“The provision of a cost-of-living allowance aims to help workers cope with their daily basic needs,” said Secretary Rosalinda Baldoz.
While unions had called for a PHP75 rise to the minimum daily wage to help workers to cope with high commodity prices, officials said the increase also had to reflect employers’ capacity to pay while fuel-related production costs were also going up.

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