Clothing industry players to end ‘ukay-ukay’ firms

CEBU, Philippines —  The textile and garment industries are pooling their efforts to hopefully put an end to the proliferation of ‘ukay-ukay’ products in the country.

Fighting the perennial problem on “ukay-ukay” products is among the immediate concerns identified in the newly crafted integrated Textile-Garment Industry Roadmap 2020-2029.

The Department of Trade and Industry’s (DTI) Bureau of Investments (BOI) launched last December 5, 2019, the Textile-Garment Industry Roadmap 2020-2029 that envisions a “Competitive, Integrated & Sustainable Philippine textile-garment industry that generates Inclusive Growth” or CISIG.

The roadmap identified three-pronged overall strategy—address smuggling and ukay-ukay operations which compete with local suppliers, provide capital and land to increase production and encourage purchase of new equipment, and provide fiscal incentives through reduced value-added tax and reduced power rates.

Among the specific actions recommended for the short term is the creation of an organization to be called Federation of the Philippine Textile and Garments Industry, which will serve as a link between the textile and garment industry and the private sector and the government.

To achieve this vision, the 10-year industry blueprint outlines a slew of short-term (2020-2022), medium (2023-2025) and long-term (2026-2029) strategies.

For the short term, the roadmap seeks to integrate the textile and garment industries, with the two “acting as conduit for each other’s growth and development.”

According to Myrna S. Austria and Mitzie Irene P. Conchada of the School of Economics, De La Salle University, the strong linkages between industry, government and private sector, and a dedicated trade office are among the initiatives to be set in motion under the newly launched roadmap.

Austria and Conchada explained that through integration, the textile industry will be more able to “supply the fabric needed by the garments industry to be competitive in CMT [cut, make, and trim] and OEM [original equipment manufacturing] segments of the value chain.”For the textile sector, other strategies to be undertaken in the near future include investing in R&D for product development and marketing, incorporating loom weaving in the curriculum to create awareness, and establishing regional/localized ecosystems.

The roadmap also presses for the strict enforcement of Republic Act No. 9242, or the Philippine Tropical Fabrics Law, that mandates localizing suppliers for the uniform of civil servants.

Medium-term strategies for textiles, meanwhile, call for addressing infrastructure gaps and logistical bottlenecks, such as by streamlining upstream and downstream connections.

Another is to improve the textile value chain by requiring the registration of chemicals and substances used, establishing a regulatory framework for the use of biocidal products, and establishing environmental and social standards.

On the long-term strategies for the textile sector, focus shall be on pushing the Philippines to be “a global player in Filipino branding” and to increase its supply of natural fiber raw materials, according to the roadmap.

For the garment industry, on the other hand, short-term strategies under CISIG include enhancing access to export markets by taking advantage of free trade agreements (FTAs) and the Philippines’ GSP status, establishing bilateral FTAs, particularly with the U.S., and negotiating for more liberal rules of origin requirements.