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Sri Lanka Lobbies 
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Cambodia To Cut Wages
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Corn-Based Fabrics
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Gap to Expand
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The International Lingerie Show
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     June 15, 2007                                        Issue #195


             McPete -Sez, 
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Sri Lanka Lobbies for US
      Duty-Free Access
Sri Lanka's garment industry is to lobby US policy makers for duty-free access for its garments on grounds of ethical manufacturing practices. 
Industry officials will visit Washington from June 25-27 to meet US Congressmen, Senators, policymakers and industry representatives.
Speaking at the Sri Lanka Economic Summit 2007 on June 8, Kumar Mirchandani, chairman of the Joint Apparel Association Forum, Marketing and Image Building Committee said: "Our industry does not employ child labor, we provide rural employment and we certainly empower women. We also have high labor standards and a high degree of social and environmental accountability. 
"So we feel we have a good chance of establishing a case for ethical practices and contributions to poverty reduction." 
Industry figures also said that there were no anti-dumping cases or other trade complaints against it at the World Trade Organization. 
Sri Lankan officials will present a campaign to the US that was launched last year, called 'Garments Without Guilt', highlighting the country's labor, social and environmental standards.
"So we think we have a case for trade not aid," said Mirchandani. "We are asking for duty free access. But we are not saying this is going to happen easily."


US Importers Postpone
   Vietnamese Orders
Many US retailers and importers are reported to be postponing new orders for Vietnamese textiles and garments until after the Department of Commerce has completed a first formal review of its import monitoring program in August.
The DoC launched the scheme to monitor imports of textiles and clothing when Vietnam joined the World Trade Organization at the beginning of this year, and it is widely seen as a prelude to self-initiating anti-dumping cases against these products. 
Under scrutiny are imports of five broad groups of products made in Vietnam - shirts, trousers, sweaters, underwear and swimwear - with reviews planned every six months.
In the first five months of this year, Vietnam's apparel exports rose by 24.3% and are on target to reach $6.5bn for the year as a whole. 
The US accounts for around half of these exports.
However, the Vietnamese point out that their exports account for just 3% of total US apparel imports and that other larger exporters are not subject to the same surveillance. 
US retailers have consistently said the mechanism is causing "serious and unnecessary uncertainty and disruption" in the retail sector.

Nicole models a garment by Tia Lyn Lingerie at the 
International Lingerie Show in Las Vegas, April 16-18.

Cambodia Plans to Cut 
The Cambodian government today gave the go-ahead to controversial measures to cut nightshift wages for garment factory workers that was reported in May.
The move is intended to create as many as 200,000 new jobs by encouraging companies to hire more people to work in the factories during the evening, and is also aimed at improving Cambodia's international competitiveness. 
But opponents say cutting nightshift wages by up to 70% will eat into factory workers' already meager pay and that there are better ways to boost business in Cambodia, such as "eliminating corruption, bureaucracy, and improving security and infrastructure."
In Cambodia the daily rate averages around US$50 a month, and under current labor laws, nightshift workers are paid twice the rate as those who work on the day shift. The new nightshift rate would be around US$65 a month.
The head of Cambodia's largest labor organization, the Free Trade Union, had threatened a national strike if the salary cut was approved. 
Cambodia currently has 300 garment factories which last year exported garments worth about US$2bn, nearly three-quarters of which were shipped to the US.

15/24              Photographed by Michael Brouwer

Corn-Based Fabrics
A textile manufacturer has committed itself to producing textiles and apparel from Ingeo fiber, which is based on 100% annually renewable resources made from corn rather than petroleum. 
Stafford Textiles, based in Toronto, Canada, is looking to capitalize on increasing demand from retailers for environmentally friendly products.
For production, NatureWorks LLC, which developed Ingeo, puts corn through a process to make plant sugars, which are fermented in a method similar to making yogurt. Then the fermentation products are transformed into a biopolymer, from which Ingeo fiber is produced.
The company said that the production process results in 68% less greenhouse gases being added to the atmosphere.
Mick Stafford, CEO of Stafford Textiles Limited, says increasing demand for environmentally friendly products is prompting retailers to push apparel manufacturers into going green. 
Once produced, Ingeo fiber has a natural feel and creates fabrics that are easy care, do not absorb odors, have natural stain resistance, will not retain moisture, and are hypoallergenic.
Stafford Textiles is headquartered in Toronto, Canada, with textile manufacturing plants in Taiwan and China, and apparel manufacturing in Sri Lanka, India and China. 
The company plans to expand its operations to Egypt and the Sub Sahara countries for duty free access to the US. 

Gas Prices & Housing 
Market Hurt Retail Sales
Sales at Macy's Inc., J.C. Penney Co. and other U.S. retailers fell in May as shoppers curbed purchases due to higher gasoline prices and a sluggish housing market. 
Sales at stores open at least a year at Macy's, the second- largest U.S. department-store chain, dropped 3.3%, the most in 18 months. Same-store sales fell 2% at J.C. Penney, the third largest. Both trailed analysts' estimates. 
U.S. retail sales from February through May rose at about half the pace from a year earlier as consumers reined in purchases of non-essential items such as clothing and home furnishings. The slowdown may continue into June, according to Michael Niemira, chief economist at the International Council of Shopping Centers. 
"We are really at a point here where this is going to be, probably for 2007, a slow-growth period for the retail world," said Eric Beder, an analyst at Brean Murray Carret & Co. in New York. Consumers "don't really see the need to take out their wallets when they are worried about their housing prices, or gas or a number of other economic features."
Same-store sales at 50 U.S. retail chains increased a combined 2.5% last month, the ICSC said. That's down from a gain of 4.5% in May 2006. Same-store sales are an industry benchmark because they exclude results from new or closed stores. 
Goldman Sachs Group Inc. said its index of May sales, which tracks about 30 retailers, rose 2.7%. 
The national average pump price for regular gasoline reached a high of $3.227 a gallon on May 23. Gasoline has climbed about 11% since last year. 
U.S. sales of previously owned homes dropped in April to the lowest level in almost four years, the National Association of Realtors said May 25. The median price of an existing home fell 0.8% last month to $220,900. 
With lower home prices and higher interest rates, people find it harder to extract equity from their properties. That may contribute to a slowdown in consumer spending, which accounts for more than two-thirds of the U.S. economy, economists have said. 
Fifty-seven percent of retailers reported sales that beat estimates, while 41% missed, according to Retail Metrics LLC, a research firm based in Swampscott, Massachusetts. 

                Italy To Seek Quota 
Italy will seek an extension of soon-to-expire quotas on Chinese clothing and textiles entering Europe but it will be difficult to get China to agree, Italy's trade minister said.
The European Commission negotiated the quotas with China in 2005 amid what was dubbed "Bra Wars".
Textile producers in Italy and other European countries are worried there will be a surge of imports from China when the quotas expire in December, especially because similar limits in the United States and other countries run until the end of 2008.
"The Italian government is aware of the issue. There is a sort of mismatch of dates," Italian Trade Minister Emma Bonino said. "Of course it is not easy to get China to simply accept to put everybody on the same date, but we will try anyhow."
Ms Bonino noted Italian producers had invested and undergone painful restructuring in recent years to make higher-value textiles that are less vulnerable to Chinese competition.
"They are worried but they are not panicking," she said during a debate on globalization organized by the European Policy Centre, a Brussels think-tank.
EU trade chief Peter Mandelson has said he will monitor imports of clothes and textiles when the quotas expire but any move to extend them would require the agreement of China.
The 2005 "Bra Wars" split the EU, pitting countries with big textiles industries, among them Italy, France and Spain, which pushed for the quotas against more free-trading countries such as Sweden which saw the limits as protectionism.


           Textile Union Pushes 
American Eagle Outfitters      
Textile union Unite Here is calling on American and Canadian university students to boycott retailer American Eagle Outfitters when doing their back-to-school shopping, until it improves conditions for workers at a distribution centre near Toronto.
Hundreds of activists are already said to have pledged not to purchase clothing from the chain store until it enforces its Code of Conduct at the company's Canadian distribution contractor, National Logistics Services. 
The union alleges that workers have poor job security and were harassed and intimidated when they tried to form a union.
American Eagle, which operates 1,000 stores in North America, outsources its Canadian distribution operations to NLS, but the clothing company directly owned and operated the distribution center until early 2006. 
American Eagle remains NLS's largest customer, and the distribution centre serves the retailer's expanding base of 73 stores in Canada. 
"American Eagle's code of conduct for vendors and contractors specifically protects freedom of association and other basic rights for the employees of its contractors," the group said in a release.
"If American Eagle is serious about their Code of Conduct then they will demand compliance from NLS for Canadian workers, just as they will for garment workers in China sewing jeans or shorts," said Alex Dagg, Unite Here's Canadian co-director. 
"Furthermore, American Eagle should not think it can flout its own rules by going across the border to Canada or across the ocean to Asia."

 Wage Increases Threaten
   Saipan Garment Firms
Plans to raise the minimum wage rate for workers in Saipan could lead to the end of garment manufacturing on the island according to local media reports.
The wage hike was approved by President Bush in May and will add 50 cents a year to the basic hourly rate over an eight-year period. The first 50 cent increase will take place on July 24.
According to local forecasts, half of the 15 remaining garment factories will close after the first wage hike and the remainder will shut after the second increase next year.
Richard A Pierce, the governor's special assistant for trade relations, told the Saipan Tribune: "We will still have about 80% of the revenue somewhere about nine to 10 months from now. 
"If the second increase is implemented, then we'll lose all of them. That's guaranteed-absolutely, positively, without a doubt." 
Under current tariff rules, manufacturers have to carry out a certain amount of manufacturing in Saipan to qualify for the 'Made in USA' label. They are now hoping the value-added provision will be amended so less local work is required.

               Gap to Expand
San Francisco-based Gap Inc has lined up a series of franchise deals with retailers in Saudi Arabia and Turkey.
The retailer will introduce the Gap and Banana Republic brands in the two countries, opening approximately 90 Gap stores and 20 Banana Republic stores by 2012. 
Gap has struck the deals with franchise partners Fawaz Alhokair Group in Saudi Arabia and Fiba Holding in Turkey. The first Gap stores will open in each country by the end of this year, and the first Banana Republic stores are expected to open by spring 2008.
"Both Saudi Arabia and Turkey represent natural markets for Gap to expand its international presence," said Ron Young, senior vice president of international strategic alliances for Gap. 
Gap currently operates branded stores in six countries and Banana Republic stores in three countries. It has franchise agreements for Gap and Banana Republic stores in Bahrain, Indonesia, Kuwait, Malaysia, Oman, Qatar, Singapore, South Korea and the United Arab Emirates.

JTEPA Expected To Increase Thailand's Textile Exports
The implementation of the Japan Thailand Economic Partnership Agreement (JTEPA) in August is expected to trigger vigorous growth of Thai textile exports according to the Ministry of Commerce. 
Under JTEPA, Japan will cut tariffs on textiles and garments from 12% to zero starting from October 2007. 
Sales of textile companies supplying the Japanese market are expected to increase by at least 20-30%, impacting Thailand's trade figures by the fourth quarter of this year, and special projects promoting joint investments are planned. 
To qualify for zero tariffs, garment exporters must use fabrics from Thailand, Japan or other ASEAN countries, and cut and sew these fabrics in Thailand.
JTEPA will encourage Japanese investors to set up new factories or joint ventures to sell duty-free products and reduce production costs. Thai businesses will also benefit in terms of knowledge transfer.
The organizers of the Bangkok International Fashion Fair (BIFF) in August are also expecting a large attendance from Japanese buyers seeking to take advantage of the wide-ranging capabilities of Thailand and other ASEAN countries in the field of garments and other fashion goods. 
The show will take place at the BITEC Exhibition and Convention Center on 22-26 August. 

Life's Logic
Smart man + smart woman = romance 
Smart man + dumb woman = affair 
Dumb man + smart woman = marriage 
Dumb man + dumb woman = pregnancy
Smart boss + smart employee = profit
Smart boss + dumb employee = production
Dumb boss + smart employee = promotion
Dumb boss + dumb employee = overtime
A man will pay $20 for a $10 item he needs.
A woman will pay $10 for a $20 item that she doesn't need.
A woman worries about the future until she gets a husband.
A man never worries about the future until he gets a wife.
A successful man is one who makes more money than his wife can spend.
A successful woman is one who can find such a man.
Married men live longer than single men do, but married men are a lot more willing to die.
A woman marries a man expecting he will change, but he doesn't.
A man marries a woman expecting that she won't change, and she does.
A woman has the last word in any argument.
Anything a man says after that is the beginning of a new argument.
Old aunts used to come up to me at weddings, poking me in the ribs and cackling, telling me, "You're next." They stopped after I started doing the same thing to them at funerals. 

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