Prospects for the Textile and Clothing Industry in Brazil

摘要

Brazil's textile and clothing industry employs around 1.7 mn people and in 2010 its output was valued at about US$52 bn. As such, it forms a major part of the country's manufacturing sector—although the latter has been declining in importance as the buoyant and fast maturing Brazilian economy has become increasingly focused on services and exports of commodities. Many of those exports go to China, and the latter has become a principal trading partner. As much as 97% of the textile and clothing industry's output was directed towards the domestic market in 2010. This market has grown significantly in recent years, in line with rising personal disposable incomes and government initiatives aimed at eradicating poverty. Consumption of fibres per head has increased substantially over the years and is expected to double from 10 kg per person in 2005 to 20 kg by 2015. Meanwhile, the 3% of output which was exported in 2010 represented a mere 1% of the country's export earnings. Moreover, exports of made-up articles have been falling as Brazilian producers have focused on the buoyant domestic market. Besides, they have lost international competitiveness as a result of the strong appreciation of the Brazilian real against the US dollar and many other currencies—combined with the growing competitiveness of the textile and clothing industries in low cost Asian countries. At the same time, textile and clothing imports into Brazil—although small—are increasing rapidly and are forecast to continue their upward momentum. As a result, there is expected to be a trade deficit in textiles and clothing of more than US$5.5 bn in 2011 whereas Brazil enjoyed a positive trade balance as recently as 2005. The industry enjoys a competitive advantage by having local sources of raw materials—especially cotton, which dominates fibre consumption by the country's mills. Cotton cultivation in the country is almost completely mechanised, and new higher yielding and disease resistant varieties have been introduced. As a result, output has risen sufficiently for Brazil to become a major cotton exporter rather than an occasional importer. Brazil also has a man-made fibre sector which meets some of the industry's requirements but at a relatively high cost. However, this is set to be transformed following the discovery of large offshore oil reserves and the proposed construction of two petrochemical plants.