Interview: Jean-François Limantour, president, CEDITH - Invest in ...

Interview: Jean-François Limantour, president,CEDITHJean-François Limantour, president of the Cercle Euroméditerranéendes Dirigeants Textile-Habillement (CEDITH), talksto just-style about how the North African/Tunisian textile andapparel export industry is faring after the Arab Spring uprisings oftwo years ago.Pointing to data from Eurostatand CEDITH - a group set upby senior executives fromtextile and clothing firms in theEurope-Mediterranean zone todefend the interests of thesector and promote itsdevelopment - Limantourargues that the 'Arab Spring'has had little impact on theperformance of the textile andclothing industry in theMaghreb region.European imports from Tunisiain 2011 showed an increase of3.6% on the previous year tojust over EUR 2.7bn(US$3.6bn) while those fromMorocco, where revolutionaryfervour was absent, were up6.1% to almost EUR2.4bn."There were expectations of astrong downturn in Tunisia andone which Morocco wouldbenefit from, but on theevidence of the 2011 data thisdid not materialise," Limantoursays."In Tunisia, few textile andclothing firms closed, whileforeign investment continuedto increase. Yes, there werestrikes but generally speaking,it was business as usual in thesector and transport, customsand administrative servicesIn September 2011, Limantour set up the Tunisian TextileIntelligence Group to foster co-operation between Franceand Tunisiacarried on as normal."Norhave there been any cases oflabour costs in Tunisia gettingout of control -which came asa huge relief to Europeandistributors who source in thecountry."However, European importsfrom Tunisia last year totalledEUR2.4bn, down 11.5% andfell 7% from MoroccoEUR2.2bn.toBut Limantour is swift tounderline that this negativetrend is not fall-out from the'Arab Spring' but is instead dueto the poor economic climatein Europe and a decline inconsumer purchasing powerand confidence, and risingunemployment."Total textile and clothingUnion dipped by 5.6% in 2012on the previous year toEUR89.6bn. Shipments fromChina were down 7.9%," henotes."The reduction in consumerpurchases is particularlymarked in southern Europe -notably in Spain, Italy andFrance - the three countriesthat are the main markets forTunisian and Moroccanexporters."The immediate challengefacing these exporters is to'tough it out' in the hope ofbetter days ahead in the formof economic recovery inEurope."

European importsData on European importsfrom Tunisia and Morocco inthe first quarter of 2013highlights contrasting fortunes.Tunisian-origin goods weredown 7.9% in value on Q12012, but textiles and clothingfrom Morocco was up 10.9%."It's too soon to drawdefinitive conclusions, but thisfall in exports from Tunisia isdoubtless a consequence ofthe complex political situationin the country and the rise ofradical Salafism whosenegative image is certainly notlikely to reassure internationalbuyers."Beyond economic and politicalfactors, Limantour saysexporters in Tunisia andMorocco need to adapt to thedemands of western marketsand work on their globalcompetitiveness in order toplay the fast fashion card tothe full."They must invest in improvingtheir competency in marketingand management, includingthe development of trainingprovision, particularly formanagers, and strengthentheir performance in fastfashion."Turning to Algeria, Limantourdescribed as "excellent" therecent partnership agreementbetween Algerian state holdingcompany SGP-IM, and Turkishgroup Taypa to build a textilesclothingindustry cluster inimports into the EuropeanCountry."Several Turkishclothing and textile firms areplanning to link up with theirAlgerian counterparts with thesupport of Algeria'sgovernment."This kind of partnershipshould favour the restructuringand the development of thesector in Algeria, which iscurrently very weak - and isthe way forward for otherNorth African countries too."Chinese investmentQuizzed on the prospect ofChinese investors targeting theMaghreb's garment-makingsector, given rising labourcosts in China, Limantour said:"Currently, Chinese wages,including those in the [moreprosperous] coastal, regionssuch as Shanghai, are stillinferior to those in NorthAfrica."However, the Chinese couldwell invest in countries such asTunisia and Morocco andAlgeria as a means of playingthe fast fashion card to tapEuropean markets."Transit times for the deliveryof goods [to Europe] would bethree days compared to amonth from China whileanotherconsiderableadvantage would be thatChinese manufacturers wouldbe able to export garments toEuropean markets withouthaving to pay customs dutieslevied, on average, at 12%."But apart from Egypt, there iscurrently little direct Chineseinvestment in North Africa.Limantour underlines."Algeria is invaded by Chineseorigingarments either shippeddirectly from China or via the'suitcase trade' or ascontraband. Tunisia andMorocco are being increasinglyaffected, too, by what is oftenan illegal trade," he revealed.Limantour argues there issupport from the businesscommunity and the politicalauthorities in Tunisia, Moroccoand Algeria for inwardinvestment from China in thetextiles and clothing industry"Such a move would createjobs as well as strengthen theglobal competitiveness of thesector in the region. It wouldalso contribute to thedevelopment of its exports. Itwould be a win-win situation,not a threat but anopportunity."He believes that among thenumerous handicaps facingfirms in the sector, two can beresolved through closer andstronger co-operation withpartners not only in Europe,but in Turkey and China andelsewhere too."One is a weakness upstreamin fabric and thread andaccessory production and theother insufficient size tocompete on equal terms withthe big Asian groups.Source: www.just-style.com