US government accuses Chinese-backed fast fashion digital platforms Shein and Temu of posing risks to data privacy and engaging in unfair market practices, according to a report by the US-China Economic and Security Review Commission (USCC).

Shein has outpaced competitors, including Zara and H&M, to take a dominant position in the US market, which other Chinese firms are seeking to replicate. The report alleged that these firms exploit trade import exemptions and pose challenges to US regulations, laws, and principles of market access. Shein's business model relies on tracking and analysing user data to discern emerging fashion preferences and patterns. Temu has also replicated Shein's process of quickly manufacturing and shipping clothing to US consumers.

Other established and emerging Chinese e-commerce firms seek to penetrate the US market by modelling their strategies on Shein and Temu's businesses.

The report stressed that the government should ensure that these firms adhere to US laws and regulations and are not granted unfair advantages over US firms.

China's textile and apparel exports showed an unexpected surge in March, with a year-on-year increase of 19.7%, leaving industry experts to wonder about the reasons behind the growth.

This positive development is particularly noteworthy given the concerns expressed by the industry in the first quarter about the significant drop in export orders. The growth is primarily attributed to a 31.9% increase in the export of garments and accessories, while yarns, fabrics, and related products also experienced a modest rise of 9.1%. However, the exact factors contributing to this unexpected rise are not entirely clear.

Some market observers believe that the epidemic prevention and control policy, which led to an increase in orders, played a role in the rise. However, the outbreak of the virus in December and the Spring Festival in January affected domestic production and overseas orders, which might not have been reflected in the data until March.

On the other hand, some experts believe that the stock of fabric and apparel enterprises was not extensive, and there was demand for replenishment overseas, which further stimulated the downstream production in China. It is also possible that the downstream fabric mills resumed works after the Lantern Festival, leading to a wave of hot sales.

Furthermore, cross-border e-commerce orders also received positive feedback, providing a significant boost to terminal exports. However, it is difficult to account for the 32% growth in apparel exports, despite the above-mentioned reasons. As a result, industry experts believe that it is essential to monitor the trend in the coming months to see if the growth continues or if it was a temporary phenomenon.

The monthly export report and detailed data of exports issued by China customs in late March will provide a better understanding of the situation. Additionally, China's future textile and apparel exports to Europe, the US, and Japan will help confirm whether the export growth will sustain or not.

Walmart is selling its direct-to-consumer menswear brand, Bonobos, to brand management firm WHP Global and apparel retailer Express Inc. for a combined $75m, six years after acquiring it for $310m.

WHP Global is paying $50m for the Bonobos brand, while Express will acquire the operating assets and assume the related liabilities of its business for $25m.

Analysts suggest that Bonobos may have a better chance of thriving under its new owners, given Walmart's lack of development of the brand since acquiring it in 2017.

For Express, the acquisition provides a chance to diversify from its core, middle-market business, and for WHP Global, the deal enables the company to expand its portfolio.

The deal is expected to close in Express' second quarter, subject to customary closing conditions.

The latest fire broke out in the Bangladesh capital of Dhaka, when most of the complex's nearly 1,500 shops were shut. Firefighters and military personnel finally extinguished a blaze that swept through a three-story shopping complex over the weekend, causing injuries to 30 people.

The majority of stores were fully stocked ahead of the Muslim festival of Eid later this month, and shopkeepers were seen trying to salvage their stocks amidst the devastation.

This is the second such incident in just two weeks, following a massive fire that destroyed 5,000 stores on April 4.

Lax regulations and poor enforcement have been blamed for industrial fires that have plagued Bangladesh in recent years, with the country and international clothing brands that manufacture there coming under intense scrutiny after several disasters that killed over 1,200 workers.

While the garment industry has made strides to improve safety, fires continue to occur in other sectors.

Superdry, a UK-based fashion brand, is now anticipating lower profits and lower sales between $771-$796 million. The factors cited for the shortfall include the "cost-of-living issue" and poor weather impacting demand for spring and summer items. The company's wholesale division has not performed as well as the rest of the company.

To address the situation, the company is considering various funding options, including a potential stock raising of up to 20%, the company's stock price has fallen 37% over the past year, and it has retracted its profit forecast of "broadly breakeven" for the coming year.

Superdry has identified cost savings of over 35 million pounds. The clothing chain currently has 104 shops across the UK, including in major cities like London, Glasgow, Belfast and Cardiff and 198 abroad.

Last month, Superdry reached an agreement with South Korea's Cowell Fashion Company to sell its intellectual property holdings in most of the Asia Pacific area for $50 million, subject to shareholder approval.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is calling for the waiver of the 7.5% and 15% VAT imposed on locally recycled fiber to attract more foreign investment in the industry.

The tax applies to the collection of raw materials used by locally established recycled fiber production mills and their supply to local spinning mills. Additionally, the BGMEA is urging the establishment of an HS code and duty-free facilities for importing textile waste, clips, and mutilated garments from the textile industry.

Recycled fiber is an emerging 100% export-oriented backward industry that is growing in importance for achieving new laws and Sustainable Development Goals (SDGs) in the EU and the West. However, locally sourced 5,77,000 tons of textile waste are not enough to meet demand from buyers. To address this, the BGMEA is recommending the import of textile waste and mutilated garments to meet demand.

Producing recycled fiber adds value at the local level, is chemical-free, and emits no CO2, making it a unique solution for protecting the environment. Using recycled fiber as an alternative to virgin cotton saves Bangladesh at least 30% of foreign exchange on total imports of virgin cotton, which is worth an estimated $1 billion.

As international consumers shift towards circular fashion and recycled products, the BGMEA believes it is crucial to focus on reusing post-industrial waste or jute cloth as raw materials. The European Union's new law requires cotton fabrics to include at least 50% virgin cotton, organic cotton, or polyester with a comparable rate (recycled fiber) by 2025.

To encourage foreign investment, increase the use of recycled fiber in the industry, and ensure access to the European market for apparel items made from recycled fibers, the BGMEA has suggested the exemption of the 7.5% and 15% VAT charged on the gathering of raw materials used by locally established recycled fiber manufacturing mills and their supply to local spinning mills.

Fast Retailing Co Ltd, the parent company of Uniqlo, reported a 16 percent increase in first-half profit and raised its full-year outlook, citing signs of recovery in China and strong sales growth in Europe and North America.

The results reflect the growing evidence that Chinese consumer spending is rebounding after long Covid-19 lockdowns took their toll on the world’s second-largest economy.

In contrast, in Japan, where Uniqlo's has had a long success, profit slipped almost 2 percent even as revenue climbed, as a weakened yen currency raised the cost of sales.

Fast Retailing gave corporate Japan a jolt this year when it said it would raise wages by as much as 40 percent, sending a clear signal that rock-bottom salaries were starting to budge after decades of deflation and cost-cutting, as Japan ran the risk of not being able to secure human resources if it did not start paying younger people more.

Fast Retailing's overall wage costs rose 23 percent from the same period last year.

The company raised its forecast for full-year profit to 360 billion yen from 350 billion yen.

Indonesia's policy of banning the sale of imported used clothing or thrift products has been met with mixed reactions. While the government has been aggressive in implementing this policy, the reality is that it is difficult to enforce due to the high demand for used clothing. In addition, this policy does not address the real issue affecting the national textile industry, which is the large proportion of imports dominated by textiles and textile materials from China and other countries.

According to data from the Central Statistics Agency (BPS), Indonesia has been flooded with an average of 2.25 million tons of textile products each year in the last five years. The volume of Indonesian textile imports increased by 21.11 percent to 2.2 million tons in 2021 compared to the previous year, with China being the largest contributor at 990.20 thousand tonnes. Weakening competitiveness of Indonesia's textile industry compared to neighboring countries, is threatened by a wave of de-industrialization. This strategic industry needs serious support from the government and local authorities. To revive the industry, the government needs to encourage the entry of advanced technology in the TPT sector. This will improve the quality, productivity, and efficiency of the industry, as well as meet the growing needs of consumers. One way to achieve this is by providing credit programs with subsidized interest to help replace obsolete TPT machines with more modern and efficient ones. This should be a priority, particularly as many of these industries are still classified as old small-medium enterprises (SMEs). The government's support for modernizing technology is a crucial step in achieving this goal.

The Philippines has taken the final step towards implementing the Regional Comprehensive Economic Partnership (RCEP) agreement, which will be effective from June 2, 2023.

The RCEP agreement covers a vast range of goods and services, including textiles and clothing products. The implementation of RCEP is expected to significantly enhance economic ties between the Philippines and China, providing a much-needed boost to the country's economy, which has been impacted by the COVID-19 pandemic.

The textile and garment industry is expected to benefit significantly from the RCEP agreement between the Philippines and China. China is the Philippines' largest supplier of textiles and garments, with the Philippines importing over US$1 billion worth of textiles and garments from China in 2019.

Under the RCEP agreement, tariffs on textile and clothing products are expected to gradually decrease to zero from their present rate of 3% to 30%. This reduction in tariffs is anticipated to benefit the Philippine textile and garment industry, which contributed around 5.8% to the country's GDP in 2020.

The Philippine textile and garment industry is primarily export-oriented, with the majority of its exports going to the United States and Europe. However, China is also an important market for Philippine textiles and garments, accounting for around 5% of the country's total textile and garment exports. The reduction in tariffs under the RCEP agreement is expected to increase the competitiveness of Philippine textiles and garments in the Chinese market, potentially leading to increased exports to China.

In 2020, the Philippine Statistics Authority reported that the country's textile and garment exports declined by 18.4% due to the COVID-19 pandemic. However, with the implementation of the RCEP agreement and the gradual reduction of tariffs, the industry is expected to recover and see growth in the coming years.

The RCEP agreement is considered a significant step towards regional economic integration, with the 15 participating countries accounting for approximately 30% of the world's GDP and population.

Top 20 local Chinese brands made up 60 percent of total sales in the apparel market, while foreign brands' sales shrank from 46 percent to 40 percent from the year before in 2021. China's fashion, apparel, and luxury market is becoming even more competitive, and foreign brands are struggling to keep up with their local counterparts, according to McKinsey's latest report.

The report found, 52 percent of surveyed Chinese consumers prefer local fashion apparel brands, while 42 percent prefer local beauty brands compared to foreign skincare and cosmetics options.

The success of local brands is largely due to their strong localized strategies, including social media outreach to consumers via key opinion leaders (KOLs) and key opinion consumers (KOCs). To secure China's rising middle-class population as the key clientele demographic, foreign brands will need to adapt and find better ways to connect with consumers through China's multichannel e-commerce and social media platforms.

According to McKinsey's report, China's urbanization rate is expected to reach 70 percent by 2030, meaning a larger segment of consumers will have disposable income.

Foreign brands can look to better tailor their social media channels to connect with their target clientele authentically and efficiently. They can also localize product development and packaging to reflect local tastes and trends, and accelerate China-based product development and D2C capabilities.

As China's post-pandemic reopening continues, foreign brands need to pay closer attention to evolving consumer needs, tastes, and buying power if they want to succeed in this highly competitive market.