The present and future sustainability of clothing and textiles in the ...

The world of clothing and textiles
China 1%
Brazil 2%
Greece
4%
Australia
10%
We start this report by giving an account of the
clothing and textiles sector as it is now. The next
section reports on the flow of materials through the
UK associated with clothing and textiles, to provide a
macro-economic materials account of the sector. The
remainder of the report presents a structured ‘scenario
analysis’ in which we present various possible changes
to the way we make and use clothing and textile
products and explore how these might lead to a more
sustainable future.
The clothing and textiles sector
is a major part of world trade
The clothing and textiles sector is a significant part of
the world’s economy. In 2000 the world’s consumers
spent around US$1 trillion on clothing – split roughly
one third in Western Europe, one third in North
America, one quarter in Asia A1 . Seven per cent of total
world exports are in clothing and textiles. Significant
parts of the sector are dominated by developing
countries, particularly in Asia, and above all by China.
Industrialised countries are still important exporters
of clothing and textiles, especially Germany, Italy in
clothing and the United States in textiles. Developing
countries now account for half of the world textile
exports and almost three quarters of world clothing
exports. However, for some materials, processes or
products, other countries have an important role. The
figure shows how the USA remains the largest world
exporter of cotton, despite having only 25,000 cotton
farmers. Australia and New Zealand are the largest
suppliers of wool and of carpets – which can be made
with efficient machines requiring little manual labour
– many countries including the UK are able to serve a
significant fraction of their own demand.
World cotton exports 2001/2
Rest of World
21%
Africa
12%
USA
37%
Uzbekhistan
13%
Source: ICAC 2001
Rapid change in international
trade agreements
Because of the size of the sector and the historical
dependence of clothing manufacture on cheap
labour, the clothing and textile industry is subject to
intense political interest and has been significantly
shaped by international trading agreements. From
1974 to 2005, as the skills and infrastructure of
Chinese manufacturing developed while retaining an
advantageously low wage rate, a series of ‘quotas’
and tariffs were imposed by developed economies
especially on Chinese exports, to attempt to protect
their own manufacturing interests. These agreements
(which will be discussed in more detail later in the
report) were officially ended on 1 January 2005, but
the rules of trade remain complicated and continue to
change rapidly. Regional trade blocs and preferential
trade agreements maintain various distortions to ‘free
trade’ but the ending of the main set of quotas has led
to a rapid rise in Chinese exports and a consequent
drop in prices for UK consumers. Negotiations over
China’s accession to the WTO continue to give some
protection to those threatened by Chinese growth
until 2008. During the period in which quotas were
phased out, from 1980 to 2000, average tariffs fell
from 10% to 5% in developed countries and 25% to
13% in developing. Within developing countries, such
as China, there is a proliferation of Export Processing
Zones, where some preferential treatment by the
domestic government facilitates strong exports.
Market distortion from
subsidies remains
In addition to protection from low labour cost
countries by imposition of quotas and import
tariffs, exporting countries have also supported
their manufacturing industries through allocation
of subsidies A2 . The figure shows estimates of the
true cost of producing a pound (weight) of cotton in
2001 – at a time when the market price was around
US$0.45 per pound. USA costs were highest, but
subsidies provided by the USA government brought
down the price artificially – creating grave difficulties
for developing countries, for whom cotton could be
a significant fraction of total exports. The USA is the
second largest producer of cotton in the World and
the largest exporter – and accounts for half of worlds’
production subsidies.
Over 26 million people work to
produce clothing and textiles
Estimating the number of people working in these
sectors is extremely difficult, due to the number of
small firms and subcontractors active in the area
and the difficulty of drawing boundaries between
WELL DRESSED?