São Paulo – The Brazilian textile and garment industry plans to expand its presence in the Arab world this year. The country already exports sector items to the region, including products by renowned stylists, but the participation of this market in sector foreign sales is still small in percentage terms.
"Markets like Dubai and Qatar are strategic for us, as they appreciate products with greater added value, creativity and, apart from that, the income and per capita consumption there has been growing," said to ANBA the executive director of the Texbrasil program, Rafael Cervone Netto. Texbrasil is a trade promotion project developed by the Brazilian Textile and Apparel Industry Association (Abit) and the Brazilian Export and Investment Promotion Agency (Apex-Brasil).
The agreement between both organisations should be renewed for another two years in February and should include greater work in the area of fashion. "The key should be innovation and creativity," declared Netto. The program forecasts partnership with the Polytechnic Institute of Milan, Italy, to advise companies in the creative process.
The effort in the direction of the Arab world does not only include the countries of the Gulf, but also other markets like North Africa, especially Tunisia, Morocco and Egypt. "Africa has great synergy with Brazil," stated Netto. In the case of Egypt, for example, a traditional supplier of textile material to Brazil, especially cotton, the executive believes that there is potential to increase Brazilian exports.
The superintendent director at Abit, Fernando Pimentel, is going to participate in the trade mission to North Africa that is being organized by the Ministry of Development, Industry and Foreign Trade. On Saturday, a trade delegation headed by minister Miguel Jorge heads to Libya, Algeria, Tunisia and Morocco.
The idea is not just to sell products to Arab markets, but also to promote partnerships that make possible exports to other countries, using them as platforms for exports. Europe is a destination that may be reached from North Africa, as most of the countries in the region have association agreements with the European Union. According to Netto, the tendency of internationalisation of companies has been growing in the sector.
According to the executive, Tunisia has a tradition of producing clothes under license for famous brands, and Morocco is a good market for inputs and also for garment production.
The Texbrasil project is preparing a study for the Arab countries to define the best actions for the region. In the beginning, according to Netto, the markets of Qatar and Dubai should be prospected and there may be business roundtables with companies in Tunisia, Morocco and Egypt.
Trade Balance
Exports of textiles and garments to the Arab countries totalled almost US$ 32 million last year, with a small reduction of 2.7% in comparison with the previous year. In 2007, however, revenues with shipments had grown 42.2% over 2006. The main destinations in 2008 were the United Arab Emirates, Egypt, Algeria, Morocco and Tunisia.
On the other route, Brazilian imports of textiles from the Arab world totalled US$ 48 million last year, growth of 11.5% over 2007. The main suppliers were the Emirates, Egypt, Tunisia and Morocco.
To Netto, despite the international crisis, there is space for expansion of trade, especially of garments, as Brazil exports mainly inputs and semi-manufactured products to the Arabs. "With the crisis in Europe and the United States, these countries are seeking new partners in the long run, and they want trade relations that make both win," he said. In this respect, according to him, Brazilian industry has much to offer, as the country has over 200 years of tradition in the area and dominates all areas of the textile productive chain.
Before the crisis, according to the executive, there was an estimate that global trade would rise from the current US$ 550 billion a year to US$ 800 billion in six or seven years. Even if the expansion is not that significant, Netto believes that expansion of the international market should take place at very reasonable rates. "Perspectives are good," he pointed out.
In total, Brazil exported the equivalent to US$ 2.42 billion in textiles and garments last year, growth of 2.57% over 2007. Imports totalled US$ 3.83 billion, growth of 27.3%. China and other countries in Asia were the main suppliers.
*Translated by Mark Ament
