According to a recent report by the Korea Trade-Investment Promotion Agency, Korea’s participation in the Trans-Pacific Partnership (TPP), which is expected to be signed in the first half of this year, is likely to have a positive effect on the textile and clothing industry of Korea, as the demand for high-quality fabrics manufactured in Korea will increase rapidly to take the place of cheaper Vietnamese fabrics. The agency also advised that companies in the industry should revamp their facilities for the mass production of quality fabrics. In addition, the report read that non-participation would cause the companies to relocate their production facilities abroad.
At present, the United States, which imports the largest amount of textiles and fabrics in the world, is mulling over the yarn forward issue. If the U.S. adopts the yarn forward, it is likely to become a sort of rule. The yarn forward rule is the rule that every part of a garment, beginning from the yarn and going forward, must be created in a TPP member country to qualify for the agreement.
The textile industry of Japan is preparing for yarn forward adoption, too. Itochu, for example, announced that it would build sewing factories in countries like Myanmar and Cambodia, where no tariff is imposed on imported fabrics, so as to expand its business in Southeast Asia. Uniqlo is also looking to cut costs by increasing its production in Southeast Asia instead of China.