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Cablegate: Singapore's Textiles and Apparel Production

VZCZCXYZ0001
RR RUEHWEB

DE RUEHGP #1671 2530242
ZNR UUUUU ZZH
R 100242Z SEP 07
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC 3957
INFO RUCPDOC/USDOC WASHDC

UNCLAS SINGAPORE 001671

SIPDIS

STATE FOR EB/TPP/ABT FOR GCLEMENTS
STATE PASS COMMERCE/ITA/OTEXA FOR MD'ANDREA
STATE PASS USTR FOR CMILLER

SIPDIS

E.O. 12958: N/A
TAGS: KTEX ECON ETRD SN
SUBJECT: SINGAPORE'S TEXTILES AND APPAREL PRODUCTION

REFS: A) STATE 114799 B) 06 SINGAPORE 3073

1. Post provides the following updated responses to information
requested ref A concerning Singapore's textile and apparel
industry.

2. Statistics:

Total Industrial Production:
Year USD (million)
2006 152,979
2007H1 n.a.

Total Textile/Apparel Production:
Year USD (million)
2006 519
2007H1 n.a.

Textile/Apparel's share of Imports/Exports (percent):
Year Imports Exports
2006 1.49 1.07
2007H1 1.31 0.88

Textile and apparel exports to the United States: USD (million)
Year Textile Exports Apparel Exports
2006 5.6 832.6
2007H1 1.3 325.5

Total Manufacturing Employment:
2006 382,200
2007H1 n.a.

Textile/Apparel Employment:
2006 8,281
2007H1 n.a.

USD Exchange Rate:
2006 1.5336
2007H1 1.5326

Sources: International Enterprise (IE) Singapore, Department of
Statistics, and Monetary Authority of Singapore

3. Singapore's textile and apparel industry continues to diminish
in importance compared to key industries such as electronics,
chemicals, and precision engineering. As of 2006, the country's
domestic production of textiles and apparel represented only 0.3
percent of total manufacturing output, compared to 1.5 percent in
1980. The sector employs about 8,000 workers, 15 percent less than
in 2005. Singapore has 615 textile/apparel companies, of which 100
are involved in manufacturing of high-end labels. These
manufacturers are subject to zero tariffs under the U.S.-Singapore
Free Trade Agreement, which came into effect January 1, 2004.
Singapore's textiles and apparel exports to the United States
totaled US$838.2 million in 2006, representing an increase of nearly
6.0 percent over 2005, but still 7.0 percent less than exports in
2004.

4. With government encouragement, the textile and apparel industry
has evolved from a low-cost, labor intensive sector (that began to
move offshore in the 1980s) into a fashion and design hub. More
than 100 home-grown designers and brands currently operate in
Singapore. The lifting of WTO textile and apparel quotas in January
2005 has given buyers more leverage to dictate prices to vendors.

5. To remain competitive and take advantage of quota eliminations,
Singapore manufacturers continue to relocate operations to low-cost
neighboring countries, as well as China, South Asia, Central
America, and Africa. Restrictions on China imposed by the United
States and the European Union have had minimal effect on Singapore
companies. Singapore is home to more than 70 international buying
houses that source textiles and apparel in South and Southeast Asia
worth about US$2.5 billion annually.

HERBOLD

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