At least nine multinational companies have expressed interest to put up textile or garment factories in the Philippines as part of their expansion plans to meet the growing demand here and abroad.
Robert Young, Philippine Exporters Confederation Inc. trustee for textile, yarn and fabric sector, and Foreign Buyers Association of the Philippines president, said in a report these planned investments are expected to generate about 9,000 jobs initially, and increase garments and textile exports by $500 million per year.
Young did not indicate the value of investments. He said an ideal textile fabric mill would have an investment of minimum $1 million, while a garment apparel factory would be from $300,000 to $500,000.
Young said four multinational companies from Cambodia, three from India and two from Vietnam indicated their intentions to invest in the Philippine garments and textile industry, during their one-on-one business-to-business meeting as part of the 54th Asean Economic Ministers Meeting and Related Meetings held in Cambodia last September11 to 18.
“Demand on textile is high for the 110 million Filipino population with no local manufacturing source, annual domestic clothing spending amounts to approximately $2 billion, not to mention the potential in the export business,” he added.
Young said the Philippine garments and textile industry exports are estimated at $1.5 billion, with a growth rate of 10 percent annually.
Should these potential investments materialize, he said, key export markets they can cater to include the United States and European Union as well as the Asean economies.
Exports to the EU enjoy benefits through the Generalised Scheme of Preferences Plus (GSP+) as well as the US’ GSP which will be reinstated soon, he added.
“(So) it’s viable (investment) in the Philippines, the reason being (also) is the overcrowding factories in countries like Cambodia, Vietnam and India,” he said. “The expansion plans by multinational investors normally are spread over the region and not putting ‘all the eggs in one basket’.”
“Normally, these investors will have an ocular trip for assessment, then project study will follow. So, it’s in the near term like before the year-end,” Young added.
FOBAP earlier said the domestic textile and apparel industry has already received bulk orders from countries that cannot be served by Vietnam, China, India and Bangladesh due to minimum order quantity requirement.
Young said the industry would be able to fulfill its orders despite persisting supply chain problems like port congestions, according to media reports in the country.
Young admitted that the Russia-Ukraine crisis would be a challenge in meeting the industry’s export target this year due to trade sanctions on Russia.
The country’s shipments of apparel and textile last year were worth $1.052 billion, $758 million of which was accounted for by garments.
About 80 percent of the country’s textile and garment exports are shipped to the United States, while the rest goes to the European Union, Australia, Canada and Asean countries.
