WWD: Southeast Asian Manufacturers Ponder Life After TPP

February 7, 2017

By Dene-Hern Chen

Workers sort clothing in a factory in Cambodia. (Credit: Ben Woods)

Workers sort clothing in a factory in Cambodia. (Credit: Ben Woods)

BANGKOK – Apparel manufacturers in Southeast Asia are still digesting news of the U.S. withdrawal from the controversial Trans-Pacific Partnership (TPP) and contemplating the prospects of other trade deals such as the European Union-Vietnam free trade agreement and the China-led Regional Comprehensive Economic Partnership (RCEP).

“We need to consider another solution on how to prepare and how to utilize other [free trade agreements] to bring about growth to Vietnam’s industry,” said Hoang Ngoc Anh, deputy secretary general of Vietnam Textile and Apparel Association’s trade promotion committee.

President Donald Trump on Jan. 23 signed an executive action to withdraw the U.S. from the 12-nation agreement, sending reverberations through the fashion community about how this new administration would approach its trade agenda. In Southeast Asia, three countries – Vietnam, Malaysia, and Brunei – were a part of the TPP. Vietnam stood to be one of TPP’s biggest beneficiaries.

But even if the deal dies, Vietnam’s extensive preparations for TPP have helped the country’s fast-growing apparel industry evolve. For example, Hoang said the TPP’s “yarn forward” policy, which requires that pact members use a certain percentage of domestically sourced raw materials, forced Vietnam to create its own textile industry and rely less on imports from China, South Korea and Taiwan.

“[The] Vietnamese textile and apparel industry – needs to continue to [reduce its dependence] on imported accessories and textiles,” she said.

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