Trade and other policies:

Trade and other policies:

The patterns and effects of Textile and Clothing industries in developing countries have been affected by trade and other economic policies. Countries with adequate public policies and private sectors have used the opportunities provided by temporary trade preferences for the Textile and Clothing to move up the value added chain (e.g. Asian Tigers, Mauritius, Costa Rica); other countries have used the trade preferences to attract a very important part of their manufacturing base (e.g. Lesotho, Bangladesh, Malawi) but may still have to make full use of the opportunities offered to develop dynamically and diversify into other activities at a time they are faced with 2 competition from other countries, e.g. China which affects Textile and Clothing based strategies (though wages in southern China are already rising). Case studies the importance of Textile and Clothing production for growth and development and the role of policies were evident in a number of brief country case studies:

• Growing from a virtually non-existent  base in the 1990s, Cambodia’s garment industry has become a key source of manufacturing exports  (80%) and formal employment (65%), and contributes 10-12% to the country’s GDP;

• The garment industry is the largest employer in Bangladesh after agriculture. It is the main source of manufacturing employment and exports;

• Mauritius diversified from sugar into textile and clothing in the 1980s and subsequently into tourism and other services. The T&C industry still generated around 19% of manufacturing value added, indirect employment for 250,000 people, and direct employment for around 78,000 people, 70% of total manufacturing employment, although this is now declining due to competition of China in a world less constrained by quotas;

• Madagascar benefited in important ways from the textiles and clothing industry. It benefited in particular from trade preferences and low labour costs, especially after job relocation away from higher costs in Mauritius, though there are questions about sustainability in a post-MFA quota world also competing with

China.