South American textile market is in a similar process with recovery in Asian region. Asia focuses especially on European market and Latin manufacturers also focus on North America market. However, it is too behind of Asian region as numerally, the developing countries in this region show growth with their national economy and their textile sector. Brasil is positioned as the largest economy in this region. The country which has nearly 194 million population, shows a fast growing trend as a world’s largest 8th economy by having per capital income is 10 thousand Dollar and gross domestic product (2011 year) is 2 trillion 284 billion Dollar.
Brasil carried out an import-substitution industrialization policy in 1930 like Turkey carried out. The country which increases its export production capacity with high budget investment in 1970’s, started to experience of advantageous and disadvantageous of foreign competition with liberalizing commerce in 1990’s. Liberalizing the commerce affected negatively nondurable consumer goods in particular. Brasil which is one of the first important manufacturers in world in shoe production maintains still its competition with Asian cheap production in the field of textile, ready-to-wear and shoe. The country has made breakthrough in recent years in the field of aviation industrial and telecommunication equipment beside of traditional industry sectors such as electricity equipment and automotive.
Brazil which is in the category of developing countries has a sensitive economic appearance against to shrinkage in the market. While Brazilian manufacturing industry grew by 0.16% in 2011comparing with the previous year, textile 14.88% and the apparel 4.4% decreased in proportion. In December 2011 in comprasion with previous month; it is observed that decreasing in textile down to 5.0% and decreasing in apparel is 9.4%. When we compare December 2011 with December 2010, the decreasing in textile is formed as 17.52% and in apparel is formed as 21.6%.
12 Billion Investment for Textile and Apparel
Textile and apparel in Brazil economy are defined as an traditional manufacturing branch with cotton and later treatment processes. It is indicated that cotton and fabric mills and workshops in Brazil came up in 18th century. Nowadays, there are nearly 30 thousand textile companies and annual export capacity over 2 billion Dollar is available. The country’s textile and apparel manufacturing increased in rate of 25.2% within 2005-2010, which generates an income 22 billion Dollar in the year of 2000. After 2010, Brazil became the largest 5th textile manufacturer of the world with 2.25 million tone textile production and became 4th largest apparel manufacturer with 1.96 million ton production. The effect of domestic demand’s 50% rising became prominent in this increase. Brasil which combines cotton and yarn production with fabric production process is positioned as the largest 5th cotton production and 2nd denim fabric manufacturers in our day.
While the country’s textile and apparel import rose in proportion of 24%, export decreased in proportion of 1.4%. When it is compared with 2010 year, Brazil’s sectorial commerce deficit raised 34.8% except cotton fiber. While the job balance occurs in the textile and apparel sector is -429 in November 2010, it was -7,801 in 2011. Brasil which made about 12 billion Dollar investment for textile industry in recent years, updated its infrastructure, strengthen its machine line and provided sectorial training for its stuff by making 2 billion Dollar investment in 2010 and by making 2.5 billion. According to the ITMF’s (International Textile Manufacturers Federation) data in the year of 2009, Brazil has 4.785.782 short fiber spindle capacity, 202.000 long fiber spindle capacity and 344.140.140 open-end rotor machine line. In 2010, Brazil hold 51.1% capacity of Latin America’s short fiber spindle, 29.7% capacity of short fiber spindle and 70.2% capacity of open-end rotor.
The Representative of the Sector ABIT
ABIT (Associação Brasileira da Indústria Têxtil e de Confecção- Brazil Textile and Apparel Industry Associaton) which was founded in 1960’s and Sınditextil-SP (Sao Paulo State Weaving and Spinning Industry Associaton) become prominent between countrywide organization in the sector of textile and ready-to-wear.Brazil Textile Sourcing Strategic Program (TexBrasil) which was founded in 2001 by ABIT and Apex-Brasil aims to increase the sector’s power in global market.
Fernando Valente Pimentel, superintendent director of Brazil Textile and Apparel Association (ABIT), who made estimation for the sector’s 2012 year, has said they anticipate 1.5 percent growth in textile and apparel sector. Pimental has explained that they expect 3 percent physical growth and USD 63 billion volumes for the ready-to-wear sector. Pimental has said “Job creation in the sector remains stable. Brazilian trade balance will be USD 11 billion. According to the estimation of market builder, gross domestic product in 2012 will raise in the proportion of 3.09”
Fernando Valente Pimental who has said Brazil is the strongest sector in Latin America, the most important business partners of Brazil are Common Southern Market (MERCOSUR – Brazil, Argentine, Uruguay, Paraguay and Venezuela take part in this organization) and Colombia. Pimental who has claimed that deindustrialization policy is carried out in Argentine in this period, has said the Argentinean government brought restriction to the textile import because of the pressure of domestic textile industry. Pimental who has underlined that it is an unacceptable situation for free trade area, kept his words by saying; “Anti-circumvention provisions have already been published by the Brazilian government for Uruguay and Paraguay. China has very important export and share. 90% percent of blankets and quilts segment come from China as produced. Generally, we have a weaving based structure in MERCOSUR region. This import cannot be acceptable. Most of South American representative has been affected negatively because of this unfair competition arising from Asia.
The Sector Spread out all Regions.
Pimental who has indicated Brazil is the biggest textile and cotton chain in the west, has said that they are most strongest country with the integrated chain from fiber to ready-to-wear. Pimental who has qualified Brazil as an entrance gateway to the Latin America, has underlined that many sector professionals come from oversea countries beside of Latin America participate in Premiere Vision Expo that hold in Brazil. Pimental who has said “We perform the biggest 5th fashion week in the world”, has indicated they have no rival in Latin America. Pimental who has told “in spite of our expensiveness arising from heavy duty restriction in our production infrastructure, these advantageous make us superior. Our only rival in here is Asian as I indicated”.
Pimental who has said that Brazil is not affected directly from global economic crisis since Brazil is in the economic growth trend, has said that they have been affected from indicated market stagnation raised from American and European buyers. Pimental who has said that they have observed not only their export figures are affected in this process but also China’s power in Brazilian market is increased directly. Pimental; “Thus, our trade balance has a negative appearance since 2006. Furthermore, our trade deficit significantly increased in 2009, 2010 and 2011.”
Pimental who has indicated has self-sufficiency in Latin market beside of Brazil is also powerful in the cotton chain, has reminded that out 99% of cotton produced in Brazil releases to domestic market and also they export cotton fiber. Pimental who has said they import a small amount of long cotton fiber that is same quality with Egyptian fiber, has indicated man-made fibers are still intensively imported. Pimental who has expressed textile companies in Brazil have already begun to produce synthetic fibers with the discovery of oil reserves in Brazil, kept his words by saying “We will soon go from importers to exporters. We uses its natural wealth for products with sustainable fibers, such as linen and wool or such as artificial fibers made from sugarcane and bamboo pulp.”
Pimental who has argued that Brazil become prominent with added value segments, has said that plain fabric (denim), bad, bath and table segments are in this segments. Pimental who has said that they are in advance with sea wear in the ready-to-wear, kept his words about Brazilian textile regions by saying “The textile is very spread out across Brazil. Brazil’s Northeast, South, Southeast and Central-West are strong in this industry. Fashion organization and fairs are always showed in these regions. The Northeast has a lot of handcrafted finishing because of the large number of lace and embroidery workers. The Southeast is the business center and is where the largest apparel manufacturers. Our fashion weeks are organized in Rio ve Sao Paulo. The South stands out for mostly cotton bed, bath and table segments. Spinning mills are powerful in the Central-West.”
Also having said his sector expectations on 2012, Pimental has argued that Brazil' government should make lower tax rates in various taxes which their companies have to pay and he has finished his words by saying “Brazil is one of the countries having the world's highest tax rates. This is the weakest link. We can guarantee better performance for the entire textile and ready-to-wear chain if we are strong.”
