The Sports Goods Sector in Pakistan - TRTA i

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One needs to keep in mind, of course, that India is a massively larger supplier; the world’slargest in fact – exporting 12,900 tons (equiv. 21.5 million pairs) in 2005, up 50% from theprevious year. The world’s second largest supplier is China, exporting mainly to Central Asia,the United States, Japan and Russia and operating in a higher price echelon compared to India.Romania is the world’s third largest supplier and supplies solely to EU countries takingadvantage of its bilateral agreement that provides duty-free access.Markets are not exclusively one quality of shoe or the other. Japan for example buys high-endleather slippers from France (US$54,000 per ton CIF – equiv. US$32/pair) but also buyssignificant quantities of low-end from Bangladesh (US$11,500 per ton CIF – equiv.US$7/pair). It is interesting to note that Japan buys 40% of its leather slippers from Bangladeshand not from Pakistan or India. This can be explained by the fact that Bangladesh benefits fromthe 30% import duty advantage as an LDC.Australia is an extremely dynamic market showing a sudden large intake of low-priced slippersfrom India (equiv. US$8/pair CIF) and China (equiv. US$7/pair CIF) since 2003. At theserock-bottom prices, Pakistan may not be able to compete.Looking closer to home at Middle Eastern markets – Oman and the United Arab Emirates arethe other obvious choices for expansion.Pakistan exported just over 279 tons in 2005; a two-fifth was destined for the UK, France, andGermany. This is a significant change from 2004 when the United Arab Emirates was the mainmarket.Non-tariff barrier information covering items such as social requirements, health and safetystandards, environmental standards, packaging size marking and labelling requirements, areprovided in detail in some of the market surveys that can be downloaded directly from ITC’sFootwear Product Map.Note: Data needs to be treated with some care, as some countries seem to be declaring exportsat significantly higher values than their trading partners e.g. Italy and Russia.Case story II: Trade potential in the footwear sector between Pakistanand TurkeyOnce trade links between two countries in a certain sector have been established, there may beno harm in taking a cross-sectional look at further trade potential. Whilst Turkey is asignificant exporter of footwear, its imports exceed exports. Turkey imports double the valueof Pakistan’s footwear exports and is showing import growth rates that are significantly morerapid than world imports. Turkey currently only imports a mere US$171,000 worth directlyfrom Pakistan. The figure would most likely increase if the indirect passage via the UAE istaken into account. Nevertheless, Pakistan could potentially export a lot more footwear toTurkey. The countries have similar tastes and styles, are within close proximity to each otherand there are matches between the footwear categories exported by Pakistan with the ones thatTurkey imports.42 International Trade Centre
Table 2.19 Pakistan-Turkey footwear trade, 2005HS codeProduct descriptionPakistan’s exportsTurkey’s imports from worldTo World To Turkey Annual growthUS$’000 US$’000 US$’000 2001-05640320 Leather slippers 5,408 31 149 34%640340 Uppers of leather withmetal toe cap640359 Uppers and soles ofleather640391 Uppers of leather, nonleathersoles, coveringankle640399 Uppers of leather, nonleathersoles, nes640510 Uppers of compositionleather3,576 0 2,299 40%6,180 0 15,208 13%27,879 137 33,142 83%8,695 0 109,979 58%67,644 0 526 -11%640590 Footwear, nes 20,885 0 1,974 32%Source: www.trademap.org.Pakistan’s current footwear exports to Turkey are in two shoe categories – boots with uppers ofleather and non-leather soles, and leather slippers. As highlighted in the table, there is a vastscope for Pakistani expansion onto the Turkish market in four categories especially: 640340,640359, 640291 and 640399.In terms of market access, Turkey’s tariffs for footwear products are quite favourable,especially taking into consideration the GSP preference that Turkey applies to imports fromPakistan. Turkey’s GSP tariff is 4.5% for almost every category, with the exception of 0% forcategory 640510 and 0-12% for category 640590.The numbers clearly invite further investigation. Perhaps a first next step would be to identifysome prospective buyers to talk to. The LeatherNet Directory at www.leathernet.com, ITC’swww.leatherline.org and Turkish Business Guide at www.turkindex.com are useful foridentifying companies. You may also wish to identify a trade fair where more investigativeinquiries could be carried out. ShoeInfonet at www.shoeinfonet.com has a calendar of footwearevents. The International Footwear Industry Trade Fair in Istanbul listed in Shoe Infonet’scalendar may be just the fair to attend.Case story III: The Swiss footwear marketKnown for its global brand Bally, Switzerland is definitely a producer and exporter offootwear, but imports far exceed exports. In 2005, Switzerland imported close to US$870million worth of footwear to meet its exceptionally high consumption of over 5 pairs per capita(EU countries consume 1.8 pairs per capita). 1It is not a surprise that Italy is Switzerland’s major supplier bordering Switzerland from thesouth and being the top footwear producer globally. 34% of Switzerland’s footwear imports1EU report on competitiveness of the footwear sector. Informal footwear market overview in Switzerland.International Trade Centre 43
Page 1: The Footwear Sector in Pakistan—
Page 7: Table of contentsAcknowledgementsAb
Page 10 and 11: the interest of buyers has dropped
Page 12 and 13: 4 International Trade Centre
Page 14 and 15: • Recommendations aimed at indivi
Page 16 and 17: Production capacitySince the data a
Page 18 and 19: Figure 2.1 Footwear manufacturing p
Page 20 and 21: No. Activity Information Input requ
Page 22 and 23: Table 2.2 Price trade structureRaw
Page 24 and 25: WholesalerIs an importer/stockist w
Page 26 and 27: oth. The employees also enjoy 14 da
Page 28 and 29: Duty drawback rates at 9/11 in 2001
Page 30 and 31: equirements for the components of f
Page 32 and 33: It is becoming increasingly difficu
Page 34 and 35: Table 2.6 Product classifications r
Page 36 and 37: HS codeProduct categoryValueUS$’0
Page 38 and 39: Table 2.10 Pakistan’s major impor
Page 40 and 41: setting design niches. China’s ma
Page 42 and 43: 640320 - Leather slippersLeather sl
Page 44 and 45: Table 2.12 United States tariffs ap
Page 46 and 47: Table 2.14 Japan tariffs applied to
Page 48 and 49: Much of the rubber is sourced from
Page 52 and 53: were of Italian origin in 2005. Thi
Page 54 and 55: since the Chinese footwear exports
Page 56 and 57: • To endeavour with other recogni
Page 58 and 59: 3.1.3 Functional scopeThe functiona
Page 60 and 61: correctly in a state of suspended a
Page 62 and 63: Ministerial Decision on Notificatio
Page 64 and 65: Demand for proactive supportive rol
Page 66 and 67: Figure 3.3 Relevance intensity of t
Page 68 and 69: However, all these exceptions are a
Page 70 and 71: Relevance for the footwear sectorTr
Page 72 and 73: include the Ministry of Commerce, M
Page 74 and 75: Agreement on Trade-Related Investme
Page 76 and 77: Agreement on safeguardsThis agreeme
Page 78 and 79: and removal of import quotas, impor
Page 80 and 81: Table 3.2: Top 10 buyers of Pakista
Page 82 and 83: GermanyGermany is the fifth export
Page 84 and 85: 4 Obstacles and shortcomings to exp
Page 86 and 87: Training institute/ human resources
Page 88 and 89: • The European Union should give
Page 90 and 91: Marketing• Market research• Fai
Page 92 and 93: Bilateral trade committeesA large n
Page 94 and 95: • Sponsors trade delegates to des
Page 96 and 97: 6 Conclusion and recommendations6.1
Page 98 and 99: 6.2 The way forward - if we had a m
Page 100 and 101:
Most of the members do not have an
Page 102 and 103:
SimilarprojectsFDDI: Footwear Desig
Page 104 and 105:
• The upper now needs to be given
Page 106 and 107:
98 International Trade Centre
Page 108:
M/s Five Star Marketing LtdM/s Foot
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