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NEWS UPDATES 12 April 2010

Malaysia: Textile industry losing out to competitors

The Malaysian textile industry is in a quandary and slowly losing out to other textile-producing countries in the region like Cambodia, China, Indonesia, Thailand and Vietnam, reported local business daily The StarBiz.

To remain competitive and relevant, it needs support from the Government and the financial sector, says Malaysian Knitting Manufacturers Association (MKMA).

“Without this support, the industry might not be able to survive and will soon become a sunset industry,” executive director Rebecca Chiang told StarBiz.

MKMA caters to the welfare of all knitting-related industries such as spinning, dyeing, printing, knitting and sewing.

Chiang said the Government should be more proactive and emulate the steps taken by the governments of the countries mentioned in supporting their textile industry.

“There is a bill in the United States requiring the health, military and postal departments there to use only locally-made fabrics for their staff uniforms,” she said.

Chiang said Malaysia should do the same and the move could include the police, immigration and customs departments, and uniforms for school children and participants of the National Service programme.

She said if such a bill were passed by parliament, not only the textile industry would benefit but so would the small and medium-scale enterprises, especially those in the support and service sectors.

Chiang said that although local textile makers were known for their reliability and quality products internationally, that would not guarantee their survival as other countries were fast catching up.

She said the textile industry remained labour-intensive and the Government must admit that companies were largely dependent on foreign workers as they were having problems hiring locals.

Chiang said that if the government did not provide long-term solutions, local textile companies would have no choice but to relocate to other countries.

She said that although production cost was rising in China, the country was huge, offered a ready workforce and companies could operate in the second- and third-tier cities.

Chiang said that while the Government always told industries to automate, it must remember that certain production procedures still required the human touch.

Moreover, it was not easy for textile companies to secure loans to invest in automation and technology, as local banks already had the notion that the industry was a sunset industry, she said.

Chiang disputed this perception, saying that the country’s export of textiles and apparel was on the uptrend in the last 10 years; although the figure declined to 8.93 billion ringgit (1$=3.4 ringgit) last year from 10.49 billion ringgit in 2008 due to the global economic recession.

“The outlook for the textile industry is still positive as orders have started coming back since the last quarter of 2009 and are expected to pick up in the second half of the year,” she said.

Chiang said local textile makers were not really perturbed by the difficulty in securing loans for their business expansion and some of them had even diversified their range of products.

These include producing fire-retardant and ultraviolet-protective textile and fabrics for the non-apparel segment such as the upholstery for furniture, automotives and aeroplanes.


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